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WHAT ARE THE MAXIMUM-OUT-OF-POCKET (MOOP) EXPENSES WITH MEDICARE?
- Michael Braden
- Jan 15
- 11 min read
Michael T. Braden December 11, 2025 MEDICARE 101
Many people are surprised to learn that Original Medicare does not include an annual cap on expenses, meaning deductibles, copays, and coinsurance can accumulate without limit. In contrast, Medicare Advantage plans are required to set an out-of-pocket maximum with limitations, and Medigap plans can significantly reduce your costs or provide a maximum limit on out-of-pocket expenses, depending on the plan you choose.
In this article, we explain what the Medicare out-of-pocket maximum really means, how it works across different types of Medicare coverage, and how you can better insulate yourself from unexpected medical bills.
FAST FACTS FROM 2025
Original Medicare (Parts A and B) has no annual medicare Out-Of-Pocket Maximum Amount, so beneficiaries can theoretically face unlimited costs for deductibles, copays, and coinsurance.
The two ways a Medicare beneficiary can limit the maximum annual out-of-pocket costs for Medicare bills are to add a Medicare supplement or replace their original Medicare with a Medicare Advantage plan.
Medicare Advantage plans, aka Medicare Part C, must include out-of-pocket costs that cap your yearly spending on covered, in-network services. In 2025, the highest allowed limit was $9,350 for in-network services and $13,300 for out-of-network services. Many plans offer lower limits, but these limits can change annually and will increase with inflation.
Medicare Supplement/Medigap plans may provide varying levels of coverage and out-of-pocket maximums; some plans, such as Plan G, offer very low maximums (limited to the Part B deductible, which is under $300), whereas others, such as Plans K and L, have higher limits due to partial coverage. All Medicare supplement plans provide greater coverage and lower out-of-pocket costs than Medicare Advantage plans.
Out-of-pocket limits do not include monthly insurance premiums or services not covered by Medicare or your Medicare replacement plan.
During initial conversations with clients, we are often asked if Medicare has a maximum out-of-pocket limit for covered health services. While the topic should be relatively simple, I am amazed by the level of confusion and misinformation spread by professional insurance agents who are supposed to be knowledgeable about it.
It’s important to note that monthly premiums for medical insurance, including drug coverage and Medicare Part B, are not included in maximum out-of-pocket cost limits. Monthly premiums are recurring costs that beneficiaries pay each month, regardless of their out-of-pocket spending.
In this article, I will be covering the subject of maximum out-of-pocket limits for Original Medicare (Medicare Part A and Medicare Part B), along with private medical insurance options, including Medicare supplement insurance, Medicare Part D prescription drug coverage, and Medicare Advantage Plans.
MOOP EXPENSES EXPLAINED
When a person first enrolls in Medicare, they typically start with Medicare Part A inpatient services and Medicare Part B, outpatient services. You can enroll in Medicare Part A months or years before Part B. However, these are the two parts of Medicare required before deciding on a Medicare supplement or Medicare Advantage plan.
Original Medicare does not have an annual maximum out-of-pocket limit. It was never intended to be a stand-alone, full-coverage option for seniors. There is no cap on Medicare out-of-pocket spending in Original Medicare, meaning your Medicare out-of-pocket costs can theoretically be unlimited. Out-of-pocket costs or expenses include deductibles, copayments, and coinsurance. These medical expenses can add up quickly without a maximum limit. The only way to place a maximum out-of-pocket on your financial risk for covered health services is to either purchase a Medicare supplement Plan or a Medicare Advantage Plan.
For those who qualify, Medicare beneficiaries can access savings programs through Medicare to help manage out-of-pocket costs, including premiums, deductibles, copayments, and prescription drug expenses.
MEDICARE SUPPLEMENT MOOP MEDICARE-OUT-OF-POCKET) EXPENSES.
Do Medicare Supplement Plans, which can be part of your medical insurance, have an annual out-of-pocket maximum?
Some Medicare supplement plans have a hard annual out-of-pocket maximum, whereas others have a “soft” maximum.
For example, the out-of-pocket maximum for Plan G is equal to the Medicare Part B deductible ($283 for 2026), a “hard” fixed maximum out of pocket. The out-of-pocket maximum for high-deductible Medigap plans equals their annual deductible ($2,950 in 2026), again a hard limit.
However, your out-of-pocket maximum for Plan N is the Part B deductible plus office/ emergency room copays. We have no way of knowing how many office visits you may have in any given year, but we can assume a reasonable number. That is a soft annual out-of-pocket maximum.
For 2026, the out-of-pocket maximum for Plan K is $8,000; for Plan L, it is $4,000. The out-of-pocket maximum applies only to medical services approved or accepted by Medicare and does not include any services or procedures not covered by these supplemental plans.
Do Medicare supplement plans have a maximum out-of-pocket? Yes, most Medicare supplement plans (aka Medigap Plans, also known as Medicare supplement insurance) have a defined annual maximum out-of-pocket that limits the financial risk for the consumer. In fact, among your Medicare choices, nothing comes close to the financial risk protection you can achieve with a Medicare supplement. Unfortunately, we've heard from people and read that Medicare supplements do not have a maximum out-of-pocket limit. Where does the confusion come from? Believe it or not, it’s Medicare. It’s from very poorly communicated benefits, directly from Medicare publications.
2026 MEDIGAP PLAN COMPARISON CHART
The Braden Medicare 2026 Medicare Supplement Comparison Chart is the same table we used to find on the Medicare.gov website and in their publications, provided by private insurance companies.
The benefit table lists 12 Medicare supplement plans. Ten across, then asterisks on the F and G to indicate that those plans have a high-deductible option. Private insurance companies offer these Medicare supplement plans, and each may offer different plan options and coverage details.
COMPARING MEDICARE SUPPLEMENT PLANS
In studying this Comparison Chart, you will quickly notice that both Plans K & L have this extra box titled “out-of-pocket limit”. However, none of the other supplement plans show a row with the same title, and none include lifetime reserve days.
Because of this communication failure, it’s easy to assume that those Medigap plans lack an annual out-of-pocket maximum. Right? That is undoubtedly what most people think, including many insurance agents who should know better.
You know what they say about assumptions. Of course.
But the blame here lies directly with Medicare for a poorly designed presentation, and it’s the government's fault. The government doesn’t typically have ears for consumer feedback. I can also tell you from years of experience that many of the government publications are not written by industry experts. The federal government sets the rules and benefit tables for Medicare plans offered by private insurers. , including maximum out-of-pocket costs and other standardized protections.
Let’s look at why these two Medigap plans, K and L, show a maximum out-of-pocket designation, where the other plans don’t need one.
Who Needs A Maximum Limit When the Plan Pays 100%
You might notice that, when you look closely at the table, most Medicare supplement Plans show 100% coverage for the significant benefits.
For example, Medicare Part B coinsurance or copayment. That is the 20% that Medicare Part B does not cover. You have 100% coverage. Everything is paid for until you reach Plans K and L. Medigap Plan K has only 50% coverage. Medigap Plan L has only 75% coverage. These coinsurance and copayment amounts apply to a wide range of medical expenses and medical services, including doctor visits, outpatient care, durable medical equipment, and covered drugs.
Look at Part A hospital coinsurance. Without a supplement, you have 60 days of coverage before you begin paying a daily copay. That copay is covered 100% by a Medicare supplement plan, except for Plans K & L. Plan K covers 50%. Plan L covers 75%. Hospital costs, such as room and board, medications administered during your stay, and other inpatient services, are included in these expenses.
Skilled Nursing. Medicare Part A covers 100% of the first 20 days, with the consumer paying a daily copayment for days 21 through 100, with a total of no more than $17,360. That’s the maximum for 2026. Skilled nursing facility costs, including daily care and rehabilitation services, are subject to these copays depending on your coverage.
If you have Medicare Supplement Plan A or Plan B, you will pay any amount not covered by Medicare, including skilled nursing facility costs. This means that if you spend 100 days in a skilled nursing facility, you will pay up to $17,360. If you have any other supplements except supplement plans K and L, you have 100% coverage. 100 days of skilled nursing care cost you nothing out-of-pocket. Zero. ($0).
Plan K & L, The Only Partial Coverage Plans
Medicare Supplement Plans K & L have a maximum out-of-pocket cost because they provide only partial coverage for primary services. Consumers have substantial financial exposure to medical bills because they do not have 100% coverage for primary services, where catastrophic coverage could help mitigate that risk. Without a set maximum out-of-pocket limit for those two plans, consumers would face unlimited financial exposure, which could result in a financial catastrophe for some people.
Think of the annual maximum out-of-pocket costs as only referencing the benefits that are covered at either 50% or 75% by these two plans.
Medicare Is Not Long-Term Care
First, Medicare is not Long-term Care. Long-term care needs are not even considered on this benefit table.
For example, your Skilled Nursing Care benefits end at 100 days. At 101 days of Skilled Nursing, you have no Medicare benefits and no Medicare supplement benefits. It doesn’t matter whether these supplemental plans offer zero coverage for Skilled nursing (Plans A and B), 100% coverage (Plans C, G, and N), or 50%-75% coverage (Plans K and L). On day 101, your Medicare coverage is depleted. In addition, after you use your initial 90 days of inpatient hospital care, Medicare provides up to 60 additional ‘lifetime reserve days’ that can be used over your lifetime for extra hospital coverage. Once these are used, you must pay all costs out of pocket. Medicare coverage is structured around ‘benefit periods’: a benefit period begins the day you are admitted as an inpatient to a hospital or skilled nursing facility and ends after you have been out for 60 consecutive days. Each benefit period resets the deductible and coinsurance requirements, and multiple benefit periods can occur within a year, which may increase your out-of-pocket costs for inpatient care.
A new benefit period begins after you have been out of the hospital or a skilled nursing facility for 60 days, and each new benefit period resets certain costs and coverage terms. You are on your own unless you have Long-Term Care Insurance. That is where your Long-Term Care insurance policy will begin.
Does 100% Mean Everything?
Second, and this is key, the maximum out-of-pocket cost limit applies only to what the Medicare supplement covers. Only costs for covered services count toward the out-of-pocket maximum; expenses for any covered service under the supplement plan, including those that Medicare covers, are included, whereas non-covered services are not.
For example, the maximum out-of-pocket cost for Plan K in 2026 is $8,000. However, that $8,000 applies only to the portion of the claim the supplement plan covers, excluding the annual deductible. It does not cover the Part B deductible. That’s an additional expense not included in the maximum out-of-pocket. It doesn’t cover Excess Charges. If you have Excess Charges, they are in addition to the maximum out-of-pocket amount.
Now let’s apply that information to Medicare Supplement Plans A and B. For Medicare services covered by Plan A or Plan B, the plan covers 100% of the Medicare bill not paidby Original Medicare. The maximum out-of-pocket cost only references the portion of Medicare services covered by the supplement. There is no maximum annual out-of-pocket cost listed because the benefits they cover are 100%. There is simply no supplemental insurance for Skilled Nursing.
That means you have a maximum out-of-pocket of zero for the benefits it covers. It just doesn’t cover as much as the other plans. There are inconvenient holes in the coverage.
Does that make sense?
Is There a Maximum Out-of-Pocket for Medicare Plan G?
The maximum out-of-pocket for Plan G is the Medicare Part B deductible($283 for 2026). Medicare Supplement Plan G covers all inpatient and outpatient Medicare expenses not paid for by Medicare. Coverage is based on the Medicare-approved amount for each service, meaning Plan G pays costs that are Medicare-approved after you meet your deductible. Medicare covers hospital stays, doctor visits, and other health services, while Plan G fills in the gaps for expenses not fully covered by Medicare. Your only expense is the annual Part B deductible. There is also no annual or lifetime cap on the benefits you receive.
Does Plan G Have a Deductible?
No, regular Plan G does not have a deductible. However, you must pay the 2026 Medicare Part B deductible of $283, unless you have a plan through a preferred provider organization that includes prescription drug coverage. In addition, the b monthly premium is a separate, recurring cost for outpatient coverage and is not included in the out-of-pocket maximum. The high-deductible version of Plan G has a $2,950 deductible for 2026. That is also its maximum out-of-pocket.
We must exclude Foreign Travel because Medicare does not cover emergency healthcare abroad, as stipulated in the Inflation Reduction Act. That is simply an extra benefit provided by the supplement.
Medicare Supplement Plan G covers 100% of all Medicare services. The only inpatient or outpatient Medicare service it does not cover is the annual Medicare Part B deductible. That is $283 for 2026. That’s it. If you have a Medicare Supplement Plan G, your maximum out-of-pocket financial risk for 2026 is $283, which does not include prescription drug coverage.
If you were to list a maximum out-of-pocket, the way this table is designed, it would be zero. However, in real life, your maximum out-of-pocket will be the Medicare Part B deductible. This is substantially lower than your financial exposure under Medicare Supplement Plans K and L. In fact, it is the lowest maximum out-of-pocket financial risk a consumer can choose with Medicare.
Considering real-life conditions rather than the limits of this table, let us examine the maximum out-of-pocket for other popular Medicare supplements, including potential drug costs.
Medigap Plan N Out-of-Pocket Maximum
When a Medicare supplement does not cover the Part B Excess Charges, like Medigap Plan N and Medigap Plan D, for example, we presume the consumer will avoid excess charges. It’s very easy to do. However, beneficiaries should be aware that they will still need to pay out of pocket for copays and deductibles.
Does Medicare Supplement Plan N Have a Deductible?
No, Plan N does not have a deductible. However, you will have to pay the annual Medicare Part B deductible, which is $283 for 2026. The monthly premium is a separate, recurring cost that is not included in your out-of-pocket maximum.
ARE THERE CO-PAYS WITH PLAN N?
Yes. There is a $20 copay for office visits that involve diagnosis or evaluation. There is a $50 copay for emergency room visits that do not result in a hospital admission. These copays are part of the plan’s cost-sharing structure, which determines how much you pay out-of-pocket for covered services. Urgent Care and Telehealth visits can be billed as an office visit. There is no copay for physical therapy or chemotherapy office visits.
HOW DO PART B EXCESS CHARGES WORK IF YOU CHOOSE PLAN N?
No. Only Plan G and Plan F will pay Part B excess charges. However, excess charges can be avoided by using Medicare’s online physician lookup tool.
When you receive medical services, Medicare pays its approved portion of the costs first, and you are responsible for the remaining expenses, such as the Part B deductible and any applicable copays. With the presumption that excess charges will be avoided, the Medicare Supplement Plan N maximum out-of-pocket will be the amount of the Medicare Part B deductible plus any of the copays you pay for office visits. There is a maximum of $20 for an office visit and $50 for a hospital emergency room visit. For a detailed comparison of these costs and coverage options, see Medicare Supplement Plan N vs Plan G.
You may not have foreknowledge of the exact number of office visits you will have in a year, but for all practical purposes, that cost, including Part D cost sharing, will likely be less than the cost of the Part B deductible.
In case you were not aware, not all office visits qualify for the $20 copay. For details, please see my video on Best Medicare Supplement Plans linked below and above my left shoulder.
The maximum out-of-pocket limit for a Medicare supplement Plan N is among the lowest available in Medicare. For all practical purposes, it will be a number less than twice the Medicare Part B deductible and certainly much, much lower than Medicare supplement Plans K and L.
HIGH DEDUCTIBLE MEDICARE SUPPLEMENT PLANS
What about the high-deductible Medicare supplements? That’s easy. The maximum out-of-pocket amount equals the deductible. The deductible is $2,950 for 2026. It increases each year with the Consumer Price Index (U), rounded to the nearest $10.
That $2,870 deductible is much lower than the maximum out-of-pocket for Medicare supplement Plans K and L, which are $8,000 and $4,000, respectively (2026). High-deductible plans have lower out-of-pocket spending limits than some other plans, including those involving out-of-network providers, and they may offer catastrophic coverage, making them an attractive option for those seeking to minimize annual costs.
With this understanding of the benefit table design, often dictated by the federal government, you should find it easy to define the maximum out-of-pocket limits for each supplemental plan.
