Final answer:
A co-payment, or copay, is a fixed amount paid by the insured for each service received, which is part of a cost-sharing strategy in many health insurance plans to prevent moral hazard.
Step-by-step explanation:
The fixed amount of money paid by the insured each time a service is rendered is commonly referred to as a co-payment or copay. This is a characteristic of many health insurance plans, where the policyholder is responsible for a specific, predetermined charge each time they receive medical care, while the insurance company covers the remaining costs. This system is part of a cost-sharing strategy designed to prevent overutilization of healthcare services, a concept known as moral hazard.
Co-pays are distinct from deductibles, which are the amount a policyholder must pay out-of-pocket before the insurer begins to cover costs. Once the deductible is met, co-pays often apply to subsequent services. Insurance plans may vary in terms of the amount charged for a copay, with common examples including a set fee for a doctor's visit or a higher fee for emergency room services.