Coinsurance Explained: What It Is, How It Works, and How It Affects Your Prescription Costs

When you hear coinsurance, the portion of your prescription cost you pay after meeting your deductible, typically as a percentage. It's not the same as a copay, and it can swing your monthly drug bill by hundreds of dollars. If your plan says you pay 20% coinsurance on Tier 3 drugs, that means for a $100 pill, you shell out $20—unless your plan has a cap. But here’s the catch: coinsurance isn’t fixed. It changes based on what tier your drug is on, whether it’s generic or brand-name, and even which pharmacy you use.

Deductible, the amount you pay for healthcare before your insurance starts sharing costs comes first. Once you hit that number, coinsurance kicks in. But if your deductible is $5,000 and you’re on a chronic medication, you might pay $1,200 out of pocket before coinsurance even starts. That’s why people on multiple prescriptions often feel blindsided—they thought insurance meant "low cost," not "pay until you break the bank." And out-of-pocket maximum, the most you’ll ever pay in a year for covered services is your safety net. Once you hit that limit, your insurer covers 100%. But many don’t know their number, or how coinsurance pushes them toward it faster than they expect.

Coinsurance hits hardest with specialty drugs. A cancer med costing $8,000 with 30% coinsurance means $2,400 per prescription. No wonder people skip doses or split pills. Some plans have tiered coinsurance: 10% for generics, 25% for brand-name, 50% for specialty. That’s why switching to a generic—like going from brand-name Lipitor to atorvastatin—can slash your bill by $200 a month. And it’s not just about the drug. Your pharmacy network matters. A drug that costs $50 with coinsurance at CVS might be $15 at Walmart’s $4 list. But if your plan doesn’t cover Walmart, you’re stuck paying full price, coinsurance and all.

Insurance companies use coinsurance to make you think you’re saving money. "Only 20%?" sounds great—until you realize your deductible was $1,500, and your monthly med is $400. You paid $1,500 just to get to the point where you pay $80 a month. That’s $1,580 for one drug. Meanwhile, someone with a $500 deductible and $10 copay paid $550 total. Coinsurance isn’t a discount—it’s a delay. And it’s designed to make you pause before filling that prescription.

What you’ll find in the posts below are real stories and data on how coinsurance plays out in the wild. You’ll see how people on diabetes meds like repaglinide get crushed by high coinsurance after deductible hits. You’ll learn why international drug pricing differences make the same pill $10 in Canada but $200 in the U.S.—and how that affects what your insurer forces you to pay. You’ll read about how generic drug price spikes turn a $10 coinsurance into $100 overnight. And you’ll find out how to fight back: using medication lists, tracking side effects, and knowing when to ask for a switch. This isn’t theory. It’s what happens when you’re stuck between a high deductible and a high price tag.