If an out-of-pocket maximum is $3,500, and you get a hospital bill for $10,000, do you only have to pay the $3,500, or the full $10k?
After you meet the deductible and out-of-pocket max, is care essentially “free” the rest of the year since you don’t have to pay out of pocket?
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To be clear – you’re forgetting about the Co-insurance portion and that could skew your math.
After you meet your deductible you switch to co-insurance where both you and your insurer share the payments on your care. 80/20 is a common ratio.
So let’s say your deductible is $2,500 and your Out-of-pocket maximum is $3,500.
The first $2,500 in bills are on you.
At $2,500 co-insurance kicks in and let’s say your rate is that 80/20. That means you pay 20 cents of every dollar billing *up to your out of pocket max.*
So $3,500 – $2,500 = $1,000 left to hit your OOP. $1,000/0.20 = $5,000.
So you need to incur an additional $5,000 in medical bills, of which you pay 20%, to reach your $3,500 OOP max.
The point being, it’s not like, oh, I’ve hit $3,500 in medical bills, now everything is “free”. You need to hit $2,500 + $5,000 = $7,500 in medical bills (of which you pay $3,500, your insurer pays $4,000) before everything becomes “free”
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