Out-of-Pocket Maximums: What You Need to Know

Out-of-pocket maximums (OOPMs) are a crucial component of health insurance plans. They set a limit on the amount you’ll have to pay for covered medical expenses in a given year. Understanding OOPMs is essential for making informed decisions about your health insurance coverage.

What is an Out-of-Pocket Maximum?

An OOPM is the total amount you’re responsible for paying for covered medical services before your insurance starts paying 100%. It includes deductibles, copayments, and coinsurance. Once you reach your OOPM, your insurance will cover all eligible expenses for the rest of the year, except for your monthly premium.

How OOPMs Work in ACA Health Plans

Under the Affordable Care Act (ACA), all qualified health plans must have an OOPM. The OOPM varies depending on the plan you choose. In 2023, the maximum OOPM for ACA health plans is $8,550 for an individual and $17,100 for a family.

Benefits of OOPMs

  • Protects you from catastrophic medical expenses.
  • Provides peace of mind knowing you have a limit on your financial responsibility.
  • Can help you budget for your health care costs.

Important Considerations

In-Network vs. Out-of-Network: OOPMs typically only apply to in-network providers. If you use an out-of-network provider, you may have to pay more.
Experimental Procedures: OOPMs may not cover experimental treatments or procedures.
Balance Billing: Some providers may try to bill you for the difference between their charges and your insurance’s allowed amount. It’s important to understand your rights and dispute any balance bills you receive.

Choosing a Plan with the Right OOPM

When choosing an ACA health plan, consider your health care needs and budget. If you have a high likelihood of needing expensive medical treatments, a plan with a lower OOPM may be more appropriate. However, if you’re generally healthy and don’t anticipate substantial medical expenses, a plan with a higher OOPM could save you money on premiums.


OOPMs are a crucial factor to consider when choosing health insurance coverage. By understanding how OOPMs work and the implications for your financial responsibility, you can make an informed decision that best meets your needs. Remember, you can always contact a licensed insurance agent for personalized guidance and assistance.

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