What is an out-of-pocket maximum?

An out-of-pocket maximum is a limit on the amount of money a person must pay for their health care expenses each year. This maximum is set by law in order to help protect consumers from large, unexpected medical bills. It is important to note that this maximum does not limit the total amount a person can be charged for health care services, just the amount they are responsible for. In North Carolina, the out-of-pocket maximum is set by the Insurance Commissioner. This maximum is divided into two categories; one for in-network services and one for out-of-network services. Generally speaking, in-network services have a lower out-of-pocket maximum than out-of-network services. For a PPO plan, which is a type of health insurance that allows people some flexibility in choosing where to receive care, the in-network out-of-pocket maximum for 2020 is $7,150 for an individual and $14,300 for a family. For out-of-network services, the out-of-pocket maximum is $10,600 for an individual and $21,200 for a family. These out-of-pocket maximums can help a person feel more secure in their health care decisions by providing a cap on how much they will have to pay out-of-pocket each year. They can also make it easier to budget for health care expenses.

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