What is an Out-of-Pocket Maximum
The out-of-pocket maximum is the most you'll ever have to pay for covered medical services in a plan year — after which your insurance covers 100% of in-network costs.
The out-of-pocket maximum (also called the out-of-pocket limit) is a cap set by your health insurance plan on how much you'll spend on covered medical services in a single plan year. Once you've paid that amount — through a combination of your deductible, copays, and coinsurance — your insurance covers 100% of in-network costs for the rest of the year.
The out-of-pocket maximum is arguably the most important number in your health plan. It defines your catastrophic risk — the maximum financial damage a health crisis can cause in a given year.
2025 ACA Limits
Under the Affordable Care Act, there are annual caps on out-of-pocket maximums for plans sold on the marketplace:
| Coverage | 2025 Out-of-Pocket Limit |
|---|---|
| Individual | $9,200 |
| Family | $18,400 |
Many employer-sponsored plans set lower limits. The ACA numbers are ceilings, not averages.
What Counts Toward the Out-of-Pocket Maximum
Generally, the following count toward your limit:
- Deductible payments
- Copays (on most plans)
- Coinsurance payments
What typically does NOT count:
- Monthly premiums
- Out-of-network costs (usually tracked separately)
- Non-covered services
- Costs above the plan's "allowed amount" for a service
Individual vs. Family Out-of-Pocket Maximums
Family plans have two layers of protection:
- Individual embedded limit: Once one family member hits their individual cap (usually half the family max), the plan covers that person 100% even if the family maximum hasn't been reached.
- Family aggregate limit: Once the family's combined spending reaches the family maximum, everyone is covered at 100%.
On plans without an embedded individual limit (aggregate-only plans), one family member could theoretically reach the full family deductible alone — something to watch out for when comparing plans.
The Out-of-Pocket Maximum vs. Deductible
| Feature | Deductible | Out-of-Pocket Max |
|---|---|---|
| When it applies | Before insurance shares costs | After deductible + coinsurance |
| What it controls | When the plan starts paying | When the plan pays everything |
| Typical range (individual) | $500–$7,000 | $2,000–$9,200 |
Once you hit your deductible, you still share costs (through coinsurance or copays) until you reach the out-of-pocket max. At that point, you're done paying for covered in-network services for the year.
When the Out-of-Pocket Maximum Matters Most
For most people in most years, this number is theoretical — you never come close to hitting it. But if you're dealing with cancer, a serious surgery, a major accident, or a chronic condition requiring regular hospitalization, the out-of-pocket maximum can be the difference between financial hardship and survivable costs. When choosing between plans during open enrollment, always ask: can I afford the out-of-pocket maximum if I have a catastrophic health event this year?