What is Out-of-Pocket Maximum?

Out-of-pocket maximum is the combination of deductible plus coinsurance. If a plan had a $2000 deductible and coinsurance maximum of $2000, the out-of-pocket maximum would be $4000. Most carriers do not add these two together, instead they describe the deductible and coinsurance as separate totals.

What is a deductible?

Deductible is the amount of covered expenses that the insured must pay before a plan or insurance contract starts to pay. With most health insurance carriers the Office Visit copay does not reduce the deductible.

What is coinsurance?

Coinsurance is the limit on the amount an individual is required to pay for health care services covered by his or her benefits plan after the deductibles and any copays are paid. Refers to care received from the network of participating physicians, hospitals and health care professionals. It is often described as a percentage 90/10, 80/20, 70/30, followed by a dollar number. In the case of 80/20 it may say coinsurance maximum or out-of-pocket maximum $2000. This means that you pay 20% of medical costs until you've paid $2000 (20% of $10,000 is $2000).