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What Is an Out-of-Pocket Maximum?

An out-of-pocket maximum is the most you have to pay for covered healthcare services in a plan year before your insurance covers 100% of additional costs. This includes deductibles, copays, and coinsurance but does not count premiums or services not covered by your plan.

How does it work?

• Original Medicare: There is no annual out-of-pocket maximum, meaning costs for Part B services (like doctor visits and outpatient care) continue throughout the year. However, some beneficiaries purchase a Medigap plan to help with expenses.
• Medicare Advantage (Part C): These plans include a set out-of-pocket maximum, which can vary but is capped by federal regulations. In 2024, the maximum is $8,850, though many plans have lower limits.
• Private insurance plans: ACA-compliant marketplace plans and employer-sponsored insurance must include an out-of-pocket maximum, with limits set annually by federal guidelines.

How Solace can help

A Solace advocate can help you understand your out-of-pocket costs, explore supplemental coverage options, and determine if you're eligible for financial assistance programs to lower expenses.