What does a "copay" refer to in a billing context?

A "copay" specifically refers to a flat fee that a patient is required to pay at the time services are rendered. This is part of their health insurance plan and is intended to share the cost of medical services between the patient and the insurance provider. Copays are typically predetermined amounts outlined in an insurance policy and can vary depending on the type of service, such as a doctor's visit or a prescription medication.

Understanding this concept is important because copays directly impact the patient's out-of-pocket costs during a healthcare visit, ensuring that patients have a financial responsibility that encourages them to utilize healthcare services appropriately while sharing the costs with their insurance provider.