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The deductible is the amount a patient pays before the plan pays anything. Deductibles generally apply per person per calendar year. Under PPOs with co-insurance, deductibles usually apply to all services, including laboratory tests, hospital stays, and doctor’s office visits. Some popular plans, however, waive the deductible for office visits. Then for most other covered medical expenses for the rest of the year, the plan pays its share, and patients pay their share. Most HMOs don’t have general deductibles, but may have a service-specific deductible for inpatient hospitalization or for brand-name prescription drugs.

Generally speaking, the higher the deductible, the lower the premium. Some plans with particularly high deductibles—say, $2,000 and up—are known as “high-deductible” plans. While these plans may have significantly lower premiums, participants are exposed to high out-of-pocket costs.