How does "Coinsurance" function in medical insurance?

Coinsurance is a cost-sharing arrangement in medical insurance where both the insured individual and the insurance company share the expenses incurred from medical services after the deductible has been met. Typically expressed as a percentage, coinsurance requires the insured to pay a certain percentage of the costs while the insurer pays the remaining percentage. For example, if a policy includes a 20% coinsurance requirement, then after the deductible has been paid, the insured would be responsible for 20% of the medical expenses, while the insurer would cover the remaining 80%. This mechanism encourages insured individuals to be more conscious of their healthcare spending, as they are responsible for a portion of the costs.

The other options do not accurately describe how coinsurance functions. For instance, paying the full amount upfront does not involve cost sharing; the insurer paying all costs does not embody the essence of coinsurance, and the insured being entirely responsible after the deductible contradicts the fundamental principle of cost-sharing present in coinsurance agreements.