Deductible

Deductible may have one of the following meanings, depending the context of the term:

1. (adj.) in a tax return, denoting an expense that may be subtracted from income.

2. (n.) the initial amount of a medical expense that a worker is required to pay before insurance companies or Medicare begin to make payments. For example, for 1990 Medicare hospital insurance, there was a $592 deductible, so the worker was responsible for the first $592 of hospital costs.