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Understand Your Out-of-Pocket Maximum (Out-of-Pocket Limit)

An African-American health plan customer trying to understand out-of-pocket maximum for health insurance
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Welcome to our comprehensive guide where we make health insurance terminology approachable, particularly the out-of-pocket maximum or as we like to say maximum out-of-pocket, also known as MOOP.

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Key Health Insurance Terms:

  1. Premium – The amount you pay for your health insurance every month.
  2. Co-payments – A fixed amount you pay for a covered health care service.
  3. Deductible – The amount you owe for covered health care services before your insurance plan starts to pay.
  4. Co-insurance – Your share of the costs of a covered healthcare service, calculated as a percentage.
  5. Maximum Out-of-Pocket or MOOP – The most you have to pay for covered services in a plan year.
  6. Network – The facilities, providers, and suppliers your health insurer has contracted with to provide health care services.

What is Maximum Out-of-Pocket (MOOP)?

The maximum out-of-pocket (MOOP) is a yearly cap set on what an enrollee pays in cost-sharing charges. It ensures that you aren’t caught off guard by massive medical bills. It’s a crucial term when you are evaluating health insurance plans.

Key Takeaways & Out-of-Pocket Limits:

  1. MOOP is a Safeguard: It sets a yearly out-of-pocket limit on the amount you’re required to pay out-of-pocket for medical expenses.
  2. It Applies to In-Network Care: MOOP doesn’t usually cover out-of-network care.
  3. 2023 Maximum Out-of Pocket Limits: For an individual, it’s $9,100, and for families, it’s $18,200.
  4. What Counts Towards MOOP? Charges like co-pays for doctors, prescriptions, ER visits, and co-insurance amounts.
  5. Premiums Don’t Count Towards MOOP: The amount you pay for your monthly health insurance premium doesn’t contribute to the MOOP.

How MOOP Benefits You

Using a simple example, let’s say Jane has a plan with a $5,000 out-of-pocket limit. Once Jane has paid up to that limit in her deductible and other cost-sharing charges within a year, her plan covers all additional in-network services for the remainder of the year.

Diagram for health insurance explaining what is out of pocket maximum


Once the out-of-pocket limit is reached:

  • The health insurance policyholder (like Jane) pays 0% for health care expenses.
  • The health plan pays 100% of health care costs.

Why Choose Marketplaceamerica.org?

Marketplaceamerica.org aims to simplify health insurance. What differentiates them?

  1. Full Integration with healthcare.gov: Offering the same plans at the same prices.
  2. One-minute quotes and 10-minute enrollments: Quick and easy.
  3. Personalized Assistance: Licensed agents help at no extra cost.
  4. Hassle-free Experience: Prioritizing your privacy.
  5. Affordable Options: Some plans starting from $0/month.


Health insurance doesn’t have to be confusing. With terms like out-of-pocket maximum (MOOP) demystified, you’re better equipped to find a plan that fits your needs. At Marketplace America, we’re dedicated to not just providing health insurance but peace of mind.

Remember: At Marketplace America, the aim is to provide more than just health insurance. They aim to give you peace of mind.

Click here to explore plans and prices on marketplaceamerica.org

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FAQ: Understanding Out-of-Pocket Maximum

What is an Out-of-pocket Maximum Vs Deductible?

The out-of-pocket maximum refers to the total amount you will have to pay in a year for covered health expenses before your health insurance pays 100%. On the other hand, a deductible is the amount you pay for covered healthcare services before your insurance plan starts to pay. Think of the out-of-pocket maximum as a safety cap on your total yearly costs.

What Happens When I Reach My Out-of-pocket Maximum?

Once you reach your out-of-pocket limit, your insurance will cover 100% of the costs of covered benefits. It essentially means that you won’t have to pay for additional covered medical services for the remainder of the year.

What Does Out-of-pocket Mean in Insurance?

In insurance terms, “out-of-pocket” refers to the direct costs the insured has to pay, like deductibles, co-payments, and coinsurance, before health insurance coverage kicks in fully.

What Happens When You Hit Your Deductible?

After hitting your deductible, you only pay a portion of the cost (like co-insurance) for covered healthcare costs. Once you’ve reached your out-of-pocket maximum, the insurance pays the rest.

Do You Pay Copays After Out-of-pocket Max?

Once you’ve reached your out-of-pocket maximum, you generally won’t have to pay copays for covered services for the rest of the year.

Do You Pay Copays After Out-of-pocket Maximum?

Similar to the above, after hitting your out-of-pocket maximum, you typically don’t have to pay additional copays for covered health services that year.

What Happens After Out-of-pocket Maximum is Met?

After meeting your out-of-pocket maximum, your health insurance company covers 100% of the allowed amount for covered services for the rest of that year.

Does Out-of-pocket Maximum Include Hospital Stays?

Yes, the out-of-pocket maximum typically includes expenses incurred during hospital stays, as long as those medical expenses are covered under your plan.

What Counts Towards Out-of-pocket Maximum?

Expenses that usually count towards your out-of-pocket maximum include deductibles, co-payments, and coinsurance. However, premiums often do not count towards this limit.

Out-of-pocket Maximum Example?

If your plan has a $5,000 out-of-pocket maximum, once you pay $5,000 in deductible, co-payments, and coinsurance, the insurance will cover the remaining costs of covered services for the rest of the year.

What is a Good Out-of-pocket Maximum?

A “good” out-of-pocket maximum largely depends on your health needs and financial situation. Lower out-of-pocket maximums can be beneficial for those expecting high medical expenses, though they might come with higher premiums.

Take Advantage of Out-of-pocket Maximum

Once you’ve reached your out-of-pocket maximum, it’s financially strategic to schedule and undergo any pending or anticipated medical procedures within that same coverage year. By doing so, you capitalize on your health insurance plan benefits, as the insurer will typically cover the cost of these procedures in full, allowing you to receive necessary care without incurring additional personal expenses.

Individual Vs Family Out-of-pocket Maximum?

An individual out-of-pocket maximum applies to single coverage, while a family out-of-pocket maximum applies when covering more than one person. Family limits are generally higher, reflecting the collective health expenses of the entire family.

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