Out-of-Pocket Maximum
The out-of-pocket maximum is the most you have to pay for covered healthcare services in a plan year, after which your insurance pays 100% of covered costs.
Exam Tip
OOPM = most you pay per year. Premiums DON'T count. After max, insurance pays 100%.
What is an Out-of-Pocket Maximum?
The out-of-pocket maximum (or out-of-pocket limit) is the most you'll pay during a policy period (usually a year) for covered healthcare services. Once you reach this amount, your insurance pays 100%.
What Counts Toward Out-of-Pocket Max
| Counts | Doesn't Count |
|---|---|
| Deductibles | Premiums |
| Copays | Out-of-network costs (sometimes) |
| Coinsurance | Non-covered services |
| Balance billing |
How It Works
Example:
- Out-of-pocket maximum: $8,000
- You've paid: $5,000 in deductibles, copays, coinsurance
- You have major surgery costing $50,000
- You pay: $3,000 more (reaching your $8,000 max)
- Insurance pays: 100% of remaining $47,000
ACA Limits (2025)
The Affordable Care Act sets maximum limits:
- Individual: $9,450
- Family: $18,900
Individual vs. Family Out-of-Pocket Max
| Type | How It Works |
|---|---|
| Individual | Each person has own limit |
| Family | Combined limit for all family members |
| Embedded | Individual limits within family plan |
In-Network vs. Out-of-Network
Most plans have separate out-of-pocket maximums:
- In-network: $6,000
- Out-of-network: $12,000 (or unlimited)
Strategies
- Combine family members' care at end of year if close to max
- Understand what counts toward your maximum
- Consider HSA-compatible high-deductible plans
Study This Term In
Related Terms
Deductible (Health Insurance)
InsuranceA deductible is the amount a policyholder must pay out-of-pocket before the insurance company begins to pay for covered expenses.
Coinsurance (Health Insurance)
InsuranceCoinsurance is a cost-sharing arrangement where the insured pays a percentage of covered medical expenses after the deductible is met, typically 20% with insurance paying 80%.
Copay (Copayment)
InsuranceA copay is a fixed dollar amount that an insured person pays for a covered healthcare service, typically due at the time of service, regardless of the total cost.