An out-of-pocket limit (or max) is the most you have to pay for covered services in a plan year. After you spend this amount on deductibles, co-payments, and co-insurance for in-network care and services, your health plan pays 100% of the costs of covered benefits.
Here’s how co-insurance and out-of-pocket max works: Imagine you have an unexpected trip to the emergency room that turns into a hospital stay. Between the ER visit, surgery, and inpatient care, your bill comes to $75,000. In the weeks ahead, when the hospital bills get processed and come back, you’ll pay your full deductible of $1,000, then you’ll pay co-insurance (for example, 20% of costs) until you meet your out-of-pocket maximum at $7,500. $7,500 is the maximum you’ll pay out-of-pocket for the whole year. So any doctor visits that happen after this will be fully covered by the insurance company.