In a typical co-insurance arrangement, what is a common split?

In a typical co-insurance arrangement, a common split is indeed 80/20, where the insurer covers 80% of the covered expenses and the insured is responsible for the remaining 20%. This structure is designed to encourage insured individuals to share in the costs of their healthcare, which can help to prevent overutilization of services while also promoting a sense of financial responsibility among policyholders.

The 80/20 split generally means that after any deductibles are met, the insurer pays the majority of the costs for covered services, allowing the insured to manage some financial responsibility without bearing the full burden. This arrangement facilitates access to necessary medical treatments while also ensuring that both parties contribute to the overall costs.

Other splits, such as a 50/50 arrangement, may not be commonly used in health insurance, as they can disproportionately impact the insured with higher out-of-pocket expenses. Similarly, a 70/30 split is less typical, as it implies a different level of risk-sharing between the insured and insurer. Finally, a 100/0 arrangement would mean that the insurer covers all costs, which is not a co-insurance model, as it does not align with the foundational principle of shared costs inherent in co-insurance.