Cost sharing is a phrase describing an insurance arrangement where a health plan participant pays a portion of the cost of a covered medical service, and the health plan pays the remaining expense. Cost sharing is sometimes referred to as an “out-of-pocket” charge because it is paid by money from the plan participant’s pocket and not the resources of the insurance company. Deductibles, copayments, and coinsurance fees are different forms of cost sharing.
A health plan may have an annual limit on cost-sharing obligations known as a MOOP, or maximum out-of-pocket.
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