A copay or copayment is a fixed amount that a patient pays to the provider of a covered service before receiving the service. It is a standard part of many health insurance plans and may be defined in an insurance policy. Copays are used by insurance companies to share healthcare costs and prevent moral hazard. They may be a small portion of the actual cost of the medical service but are meant to deter people from seeking medical care that may not be necessary, such as an infection by the common cold. However, a copay may also discourage people from seeking necessary medical care, and higher copays may result in non-use of essential medical services and prescriptions, rendering someone who is insured effectively uninsured because they are unable to pay higher copays. Copays can vary for different services within the same plan, like drugs, lab tests, and visits to specialists. Generally, plans with lower monthly premiums have higher copays, while plans with higher monthly premiums usually have lower copays. Copays are different from coinsurance, which is a percentage of the bill. Copays typically count toward meeting the out-of-pocket maximum.