What is an out-of-pocket maximum?

An out-of-pocket maximum is a limit set by health insurance companies in Alabama on how much money a person must pay out-of-pocket - such as deductibles, co-pays, and co-insurance - during the given year before the health insurance company will start making full payments for medical services. This amount varies depending on the health insurance plan and can range from a few hundred to a few thousand dollars. This out-of-pocket maximum helps to protect individuals from large medical bills that could be financially unsustainable. Additionally, the amount is typically lower than the yearly premium, meaning that people can save money throughout the year if they do not need to make extensive use of their health insurance. Overall, understanding the out-of-pocket maximum is important when comparing different health insurance plans in Alabama and when determining how much money an individual will have to pay throughout the year.

Related FAQs

What is a preferred provider organization (PPO)?
What is a fee-for-service plan?
Who is eligible for health insurance?
What is an out-of-pocket expense?
What is an enrollee cost sharing?
What is the difference between a PPO and an HMO?
What is a premium?
What is the Affordable Care Act?
What is a penalty for not having health insurance?
What is an independent review organization?

What is an out-of-pocket maximum?

Related FAQs

Related Blog Posts