, the out-of-pocket maximum is maximum amount that a policy holder
will have to pay before the insurance company
covers 100% of the remaining costs
(usually for the rest of the calendar year
For a typical policy, the out-of-pocket maximum is the deductible
+ the coinsurance
For example, a policy with a deductible
of $500 and coinsurance
of 80%/20%/$5000 would have an out-of-pocket maximum of $5500 (again, per calendar year).
Policies may have a list of certain services such as doctors visits, routine physicals, prescription drugs, etc. that require co-payments
even after the out-of-pocket maximum has been reached.
Most policies also have maximum amounts that they will cover
per calendar year or per life of the policy
. These can be in the million dollar range, for example $1 million maximum per calendar year/$6 million maximum per life of the policy. After these maximums are reached
, the policy holder is liable
for the remaining costs.