What is Out-of-pocket Maximum?

The most you have to pay for covered services in a plan year. After you spend this amount on deductibles, copayments, and coinsurance, your health plan pays 100% of the costs of covered benefits.

The out-of-pocket limit doesn’t include your monthly premiums. It also doesn’t include anything you may spend for services your plan doesn’t cover.

For the 2021 plan year: The out-of-pocket limit for a Marketplace plan can’t be more than $8,550 for an individual and $17,100 for a family.

Example of out-of-pocket maximum with high medical costs

Let’s say you need surgery with allowable costs of $20,000, and the following figures apply to your health insurance plan.

• Deductible: $1,300
• Coinsurance: 20%
• Out-of-pocket maximum: $4,400

You pay the first $1,300 of covered medical expenses (your deductible).

Your 20% coinsurance on the rest of the costs ($18,700) comes to $3,740.

So your total costs would be $5,040. That’s $1,300 (your deductible) plus $3,740 (coinsurance).

But your out-of-pocket maximum is $4,400. Your insurance company pays all covered costs above $4,400 — for this surgery and any covered care you get for the rest of the plan year.

Generally, plans with lower monthly premiums have higher out-of-pocket limits. Plans with higher premiums usually have lower out-of-pocket maximums.