What is defined as a set amount that must be paid by the patient before insurance covers additional expenses?

The term that describes a set amount that must be paid by the patient before insurance covers additional expenses is known as a deductible. A deductible is essentially the initial amount the insured individual must pay out-of-pocket for healthcare services before the insurance plan starts to pay its share. This mechanism ensures that patients shoulder some of the costs upfront before benefiting from the financial support of their insurance provider.

In the context of insurance plans, once the deductible is met, the insurance kicks in to cover further expenses, either fully or partially. This is an important aspect of health insurance, as it can affect decisions regarding healthcare usage and costs.

Co-insurance represents the percentage of costs a patient must pay after meeting their deductible, while a co-pay is a fixed amount that patients pay for specific services or prescriptions at the time of care. Maximum allowable cost refers to the cap that insurance companies will pay for a particular service or medication, which does not directly relate to the patient's responsibility before coverage begins.