Explain the term "deductible" in health insurance.

The term "deductible" in health insurance refers to the specific amount that an insured individual must pay out-of-pocket for covered healthcare services before their insurance begins to pay. This means that if an individual incurs medical expenses, they are responsible for paying up to the predetermined deductible amount themselves. For example, if a health insurance policy has a deductible of $1,000, the insured will pay the first $1,000 of medical costs. Only after this initial payment is made will the health insurance provider start to contribute to the costs, according to the terms of the policy.

Understanding the concept of a deductible is essential as it impacts how insurance payments are processed and can affect the insured's overall out-of-pocket medical costs during the coverage period. It is an important factor to consider when evaluating insurance options, as different policies may have varying deductible amounts, influencing accessibility to treatment and total healthcare costs.