A benefit payment practice used by some health insurers, and for some Medicare benefits, in which the beneficiary is billed for the contractual copayment percentage of the retail price of a given service, while the insurance company or Medicare pays only on a discounted price for the service. This practice passes a higher percentage of the real, out-of-pocket, cost on to the beneficiary than the amount stated in the contract. For example, in the case of a service which has a retail price of $1,000, the insurance contract may require the beneficiary to pay 20%, $200. The insurance company may, in fact, be obtaining the service at a discounted price of $600, so the beneficiary is actually paying 33% of the $600. In some cases the percentage paid by the beneficiary has actually been as high as 60% to 70%. The practice has been overturned in a number of lawsuits and refunds are being issued to policyholders. Reportedly requiring Medicare to charge beneficiaries only the true percentage rather than the inflated percentage could increase Medicare costs by about $134 billion over the next ten years.