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The Centers for Medicare and Medicaid Services released the cost sharing limits for 2025 plan years. The new limits will be $9,200 for self only coverage and $18,400 for family coverage.
Most health plans must comply with the Affordable Care Act’s (ACA) annual limits on total enrollee cost sharing for essential health benefits (EHBs). The cost sharing limits are commonly called the out-of-pocket maximum. Once the out-of-pocket maximum is reached for the year, the enrollee cannot be responsible for additional cost sharing for EHBs for the remainder of the year.
The scope of benefits covered by a typical employer plan must include items and services in ten general categories including hospitalization, emergency services, prescription drugs, outpatient care, maternity, newborn care, and pediatric services.
The cost sharing limits apply to all non-grandfathered health plans including self-insured plans, level funded plans, and fully insured health plans of any size. Any out-of-pocket expenses on behalf of enrollee with the respect to EHBs must count towards the cost sharing limit. This includes deductibles, coinsurance, copayments, and similar charges. But it does exclude premiums and non-covered services. For those health plans that use provider networks, they are not required to count and enrollees’ expenses for out-of-network benefits towards the cost sharing limit. The ACA also requires health plans to apply an embedded out-of-pocket limit for everyone enrolled in the coverage. Each enrollee must have an individual out-of-pocket limit on EHBs that is not higher than the ACA's out-of-pocket maximum for self-only coverage.
In 2024, employers need to be aware of the out-of-pocket maximums for their group health plans. For self-only coverage, the maximum limit is set at $9,450, while for family coverage it is $18,900. Looking ahead to 2025, these limits will be slightly reduced to $9,200 and $18,400, respectively. It is crucial for employers to carefully review their plan designs each year to ensure compliance with the cost-sharing limits established by the ACA. Download the bulletin for more details.