Out-of-Pocket Maximum is a term commonly used in health insurance policies to describe the maximum amount of money that an insured individual is required to pay for their covered healthcare expenses within a specific period, typically one year. This limit includes deductibles, copayments, and coinsurance, but it does not include premiums, balance billing amounts for non-network providers, or services that are not covered by the plan. Once an insured person reaches this maximum limit, the insurance company will pay 100% of the allowed amount for covered services for the rest of the plan year. The purpose of an out-of-pocket maximum is to protect the insured from excessive medical costs, ensuring that there is a cap on their financial liability for healthcare expenses. Different insurance plans have varying levels of out-of-pocket maximums, and these can significantly impact the overall cost and coverage of the plan.
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