For most people gone are the days in which they go to the doctor using their insurance—and that’s the end of that. Today, despite having paid a health insurance premium, patients find themselves with additional expenses. Some patients think that these are additional fees charged by the doctor outside of the customary medical charges. This is usually not the case. For the same amount of money, doctors now have to collect payment multiple times. One such charge in the copayment (copay).
Many patients don’t realize that all health insurance is a contract regarding who is going to pay for what, how much is to be paid and what is to be paid for. Insurance companies make more money if you pay for insurance and don’t use it. This is much like the subscription to the local gym. In their defense, some patients will abuse a resource if there is no cost to them at the point-of-service. Charging patients a copay can help control for this.
Copays also help catch doctors who abuse the system. A patient is more likely to call foul if a doctor submits a bill to an insurance company for a service not provided if that patient is responsible for part of the bill. So, we have co-pays. A copay fee, however, is not an extra fee the doctor collects. Doctors typically contract with insurance companies to provide service for a preset rate.
Whether you pay a co-pay or not, we are entitled to this amount. What the co-pay does is pass on a portion of the responsibility for paying what is owed to the patient, instead of the insurance company, when the patient uses the service.
For example, if our contracted amount is $100 for the service provided to you, and you have no copay then the insurance company should pay us $100. If you have a $25 copay, however, you pay the doctor $25 and the insurance company should pay $75. We just get $100 — either way. How we get it is between you and them. We are just legally obliged to collect a copay from you if we want to get paid from the insurance company at all. So, your copay — no, it’s not a tip.
Author Dr. Dina Strachan is an internationally-recognized, Harvard and Yale educated black dermatologist in nyc.
