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The term for the fixed dollar amount that a subscriber must pay each year before their insurance provider begins to cover expenses is referred to as a deductible. A deductible is designed to allocate a portion of the financial responsibility to the insured, ensuring that they contribute to their healthcare costs before the insurance plan starts to cover services. This concept is pivotal in many insurance policies, as it emphasizes shared financial risk between the policyholder and the insurer.

When a subscriber meets their annual deductible, the insurance company is then obligated to cover expenses for the remainder of the policy period, often subject to additional cost-sharing methods like co-payments or coinsurance for specific services. Understanding deductibles is essential for policyholders to manage their healthcare costs effectively, including planning for when they will begin receiving financial assistance from their insurance provider.