What does "Out-of-Pocket Maximum" mean in the context of Medicare?

The concept of "Out-of-Pocket Maximum" in the context of Medicare refers to the total annual limit on expenses that a beneficiary is required to pay for covered healthcare services. Once this maximum is reached, Medicare pays 100% of the costs for covered services for the remainder of the year, protecting beneficiaries from excessive medical expenses. This limit helps provide financial security, ensuring that individuals are not subject to unlimited costs for necessary medical care.

The other options do not accurately reflect the meaning of "Out-of-Pocket Maximum." The maximum monthly premium for a health plan pertains to the premium costs rather than direct medical expenses. The limit on copayments for doctor visits addresses specific payment requirements for those visits but does not encompass all out-of-pocket costs. The highest amount covered by a supplemental plan relates to coverage limits on additional insurance rather than the total out-of-pocket expenses incurred by a beneficiary under Medicare.