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Maximum Out of Pocket Costs

Understanding Maximum Out-of-Pocket Costs in Medicare Part C and D

One of the most important factors to consider when choosing a Medicare Advantage or Prescription Drug Plan is the Maximum Out-of-Pocket (MOOP) cost. This limit protects you by capping how much you’ll spend out of pocket for covered services during a calendar year.

If you’re exploring Medicare Part C (Medicare Advantage) or Part D (Prescription Drug Plans), there are three types of MOOP to be aware of:

Three Different types of MooP
Three Types of MooP

1. Medical In-Network MOOP (HMO & PPO Plans)

Most Medicare Advantage plans—especially HMOs and PPOs—include an in-network MOOP.

  • What it includes: Medical services you receive from providers that participate in your plan’s network.
  • Covered costs: Doctor visits, hospital stays, outpatient care, emergency services, and other medically necessary treatments—as long as they’re in-network.
  • Once you reach the in-network MOOP, your plan pays 100% of in-network medical costs for the rest of the year.

✅ Keep in mind: Medicare sets a maximum allowed MOOP, but plans often offer a lower cap. It’s a key number to compare when evaluating plans.

2. Combined In-Network and Out-of-Network MOOP (PPO Plans Only)

Some PPO Medicare Advantage plans offer out-of-network coverage, allowing you to see doctors outside of the plan’s network—typically at a higher cost.

  • What it includes: All covered medical expenses—both in-network and out-of-network.
  • PPO plans have two MOOP figures:
    • In-network MOOP: Lower, applies only to care within the plan’s network.
    • Combined MOOP: Higher, includes both in-network and out-of-network costs.
  • Once you hit the combined MOOP, the plan pays 100% of covered services, no matter where you receive care.

⚠️ Note: If you regularly go out of network, the combined MOOP becomes especially important—higher out-of-network copays and coinsurance can add up fast.

3. Prescription Drug MOOP (Part D and MAPD Plans)

Prescription drug coverage—whether through a standalone Part D plan or a Medicare Advantage plan with drug coverage (MAPD)—also has cost protections, though it’s structured a bit differently.

  • Starting in 2025, the coverage gap (also known as the “donut hole”) no longer exists. Instead, once your out-of-pocket drug costs reach a set maximum threshold, you’ll pay $0 for all covered medications for the rest of the year.
  • This out-of-pocket threshold is sometimes referred to as a MOOP for prescriptions, although it’s officially called the True Out-of-Pocket (TrOOP) limit.
  • TrOOP includes:
    • Your deductible
    • Copays and coinsurance

💡 Important: The prescription MOOP (TrOOP) is completely separate from your medical MOOP. You could hit one but not the other, depending on your health needs and medication usage.

Final Thoughts

Understanding how MOOP works—both for medical and prescription costs—can help you choose a Medicare plan that protects you from unexpected expenses. Whether you’re on an HMO, PPO, or HMO-POS, knowing your limits gives you peace of mind and control over your healthcare budget.

If you need help comparing plans or understanding your options, contact me, Benjamin, at Thompson Medicare Brokerage. I’ll guide you through the process and make sure you get the coverage that best fits your needs.

Next Steps: Making Sense of MOOP in the Bigger Picture

Understanding Maximum Out-of-Pocket costs is a key part of choosing the right Medicare plan—but it’s just one piece of the puzzle. Whether a Medicare Advantage plan (MAPD) or a Medicare Supplement is the better fit for you depends on your health needs, lifestyle, and financial goals.

There’s no one-size-fits-all answer, and that’s where I can help.

If you’re comparing plan types or still sorting through the details, I encourage you to explore more articles using the search box above or visit my Broker Services page to see how I support clients throughout their Medicare journey.

Once you’ve had a chance to do some research, I invite you to reach out and schedule a call with me. I’m Benjamin with Thompson Medicare Brokerage, and I’ll help you go beyond the basics. We’ll discuss your individual situation and ensure you understand all your options—so you can move forward with confidence and clarity.

Together, we’ll make sure you’re in the plan that truly works best for you, whether that’s Medicare Advantage or a Medicare Supplement.

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¹HealthAlliance & BlueCross BlueShield of Illinois plan options are listed separately.