Beware Which Expenses Do Not Count Toward the Out-of-Pocket Maximum
By William G. Stuart | Originally posted on Health Savings Academy
This column is an excerpt (Question 5) from a book to be published later this year to help guide account owners, employers, benefits managers, and administrators understand Health Savings Account compliance issues. The format consists of a common question, an explanation in easy-to-understand English (often with an appropriate example), and a citation from government documents to support the answer. The book is designed to inform. It is not a legal document, and the contents should not be construed as legal advice.
Question: Which expenses are included in the out-of-pocket maximum on an HSA-qualified plan?
Answer: The out-of-pocket maximum on an HSA-qualified plan includes cost-sharing (deductibles, coinsurance, and copays) for all covered in-network services. It does not include non-covered services (many plans do not cover acupuncture treatment, hearing aids, GLP-1 drugs for weight loss only, or bariatric surgery, for example) and services above the stated benefit limits (such as physical therapy visits beyond the visit limit set by the insurer).
If your plan pays a level of benefits when you receive care for non-contracted medical providers (such as a PPO or POS plan), the statutory out-of-pocket ceiling does not apply to services received outside the network. An insurer can design a plan that caps out-of-network out-of-pocket expenses at a figure much higher than the $8,500 (self-only) and $17,000 (family) ceiling for plans that start or renew in 2026.
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Tips
When you receive care outside your plan’s network of contracted providers, be careful. The out-of-pocket maximum is almost always higher than the in-network figure, and usually (but not always – check your plan documents) any in-network out-of-pocket expenses applied to the in-network out-of-pocket maximum are not also applied to the out-of-network out-of-pocket maximum.
Some other expenses do not apply to that ceiling and therefore remain your financial responsibility, including:
Charges greater than your plan’s reimbursement schedule. The difference, known as balance billing, is your financial responsibility and is not applied to your out-of-pocket maximum (or your deductible) (see Question 6).
Penalties for failure to follow plan rules. These rules include securing prospective authorization from your insurer for certain services. If you do not follow plan rules, you may be responsible for the first portion of covered expenses or pay a higher level of coinsurance as a penalty. These penalty amounts do not count toward satisfying your out-of-pocket maximum (or your deductible).
Other consequences of not following plan rules. If you schedule surgery or other treatment with a non-network surgeon at a non-network facility and do not call your plan for authorization, you may be responsible for substantially more than the penalty. Your insurer may deny some of or all the claims for the procedure or treatment for a variety of reasons. Common examples include services that are not medically necessary or appropriate, insurer requirements that patients try a less expensive treatment first, and a treatment that is covered only as day surgery and not as inpatient care. In these cases, you may be responsible for the entire portion of your expenses that your insurer denies.
Receiving care outside the network exposes you to greater financial risk, including a higher deductible and higher out-of-pocket maximum (neither of which typically accumulates toward its in-network counterpart), and balance billing and penalties (see Question 6). Health Savings Account rules do not cap your deductible or out-of-pocket responsibility (although applicable state law may provide some relief).
It is common to see out-of-network deductible and out-of-pocket ceilings that are twice as high as their in-network counterparts. In that case, if you receive care both within and outside the provider network, you face total out-of-pocket expenses three times your in-network deductible and out-of-pocket maximum.
Be sure that you understand how your plan reimburses in-network and out-of-network services. If the deductibles and out-of-pocket maximums are separate and do not accumulate, you must be aware of the financial consequences of your treatment decisions. You may have good medical reasons to consult with a specialist or have a test or procedure at a facility outside your plan’s network. Be sure to weigh the benefit of receiving that care outside the network against the cost of incurring claims that may be applied to a separate, higher deductible and out-of-pocket maximum.