By Mike Miligi | Michael M Insurance Services
Every Medicare Advantage plan advertises its monthly premium in big, bold letters. Far fewer people ask about
the number that matters more if they ever get seriously sick: the Maximum Out-of-Pocket limit, or MOOP. It’s the
single most important consumer protection built into Medicare Advantage, and it’s also one of the least
understood. Here’s exactly how it works for 2026, and why it deserves more attention than the premium does.
What Is the MOOP?
The Maximum Out-of-Pocket limit is the most you’ll pay in a calendar year for covered Medicare Part A and Part
B services under a Medicare Advantage plan. It’s made up of your deductibles, copays, and coinsurance
combined. Once your covered cost-sharing reaches that number, your plan pays 100% of covered Part A and Part
B costs for the rest of the year.
This is federally mandated. Every Medicare Advantage plan is legally required to have one, and CMS sets the
ceiling every year — plans can set their MOOP lower than the federal maximum, but never higher.
Why This Doesn’t Exist Under Original Medicare
Original Medicare (Part A and Part B) has no out-of-pocket cap at all. Part B coinsurance alone is generally 20%
of the Medicare-approved amount, with no ceiling on how much that 20% can add up to over a year of ongoing
treatment. This is precisely why most people on Original Medicare pair it with a Medicare Supplement (Medigap)
plan or employer coverage — without one, a serious illness has no built-in stopping point. Medicare Advantage
solves this differently: instead of covering the cost-sharing gap the way Medigap does, it caps your total
exposure directly.
The Three MOOP Tiers: Lower, Intermediate, and Mandatory
CMS doesn’t just set one number — it sets a range, broken into three tiers. Where a plan’s MOOP falls
determines how much flexibility that plan has in setting cost-sharing for individual services like hospital stays,
skilled nursing, or specialist visits.
Lower MOOP: The lowest in-network cap CMS allows. Plans that choose this tier get more flexibility with
certain service-category cost-sharing in exchange for offering members lower total risk.
Intermediate MOOP: A mid-point tier, with cost-sharing flexibility somewhere between Lower and
Mandatory.
Mandatory MOOP: The highest in-network cap CMS allows — the ceiling every plan must stay under. Plans
at this tier face the tightest restrictions on individual service cost-sharing amounts.
In plain terms: a plan with a Lower MOOP is generally a better deal if you end up needing significant care during
the year, because your total risk is capped much lower. A plan with a Mandatory (highest) MOOP might still be
attractive if it has a very low or $0 premium and you’re healthy, but it carries more downside risk if your health
changes.
In-Network vs. Combined MOOP — Why PPOs Have Two Numbers
HMO plans generally have a single in-network MOOP, since HMO coverage typically doesn’t extend to routine
out-of-network care. PPO plans are different — because PPOs let you see out-of-network providers without a
referral, CMS requires them to carry a second, higher Combined MOOP that covers in-network and out-ofnetwork cost-sharing together.
That means if you’re in a PPO and split time between two states, or simply want the freedom to see specialists
outside your plan’s network, you need to check both numbers — not just the in-network figure the plan
advertises most prominently.
2026 MOOP Limits (Current Plan Year)
| MOOP Tier | HMO / HMO-POS (In- Network) |
PPO In-Network | PPO Combined (In + Out- of-Network) |
|---|---|---|---|
| Mandatory (ceiling) | $9,250 | $9,250 | $13,900 |
| Average across enrollees | ~$5,400 | ~$5,400 | — |
About 9% of Medicare Advantage enrollees — roughly 1.8 million people — are in plans set right at the $9,250
maximum. The rest are in plans that voluntarily set their MOOP lower, which is exactly why the
Lower/Intermediate/Mandatory tiers above are worth checking for any specific plan you’re comparing, not just
the ceiling number.
What Counts Toward Your MOOP — and What Doesn’t
Counts toward MOOP: – Deductibles for Part A and Part B covered services – Copays for doctor visits, hospital
stays, and other covered medical care – Coinsurance for covered Part A and Part B services
Does NOT count toward MOOP: – Monthly plan premiums – Part B premium – Prescription drug costs under
Part D (that has its own separate out-of-pocket cap — a topic for its own discussion) – Costs for services not
covered by the plan – Out-of-network costs on an HMO plan without out-of-network coverage
That last point trips people up more than any other. If your HMO doesn’t cover out-of-network care at all except
emergencies, out-of-network spending isn’t capped by your MOOP — it can simply be entirely your responsibility.
What Actually Happens When You Hit Your MOOP
Once your covered cost-sharing reaches your plan’s MOOP amount for the year, your Medicare Advantage plan
covers 100% of your covered Part A and Part B services for the remainder of the calendar year. You still owe
your monthly plan premium and your Part B premium, but copays and coinsurance for covered medical care
stop. Many plans will actually notify you directly once you’ve reached the threshold.
How People Actually Reach Their MOOP
The MOOP can sound abstract until you look at what actually drives someone toward it in a real year. A few
common paths:
A hospitalization or major surgery. A single inpatient stay, especially with a complication or extended
recovery, can rack up cost-sharing quickly.
An ongoing course of specialist care — physical therapy after an injury, a cardiac rehab program, or
repeated imaging and office visits for a chronic condition.
Recurring Part B drug treatments — and this is the one that catches people off guard, because it isn’t a
single big event. It’s a steady drip of cost-sharing that adds up over the year.
The Part B Drug Example
A lot of ongoing medical treatment for seniors isn’t a pill picked up at the pharmacy — it’s a drug administered in
a doctor’s office or infusion center, billed under Part B rather than Part D. Chemotherapy and radiation drugs,
biologic infusions for autoimmune conditions, and injectable treatments for macular degeneration are all
common examples. Under Original Medicare, these are subject to standard 20% coinsurance.
For chemotherapy and radiation specifically, Medicare Advantage plans are not allowed to charge enrollees
more cost-sharing than Original Medicare would — but that also means they’re not required to cap it at a low flat
dollar amount. Because a single chemo infusion or radiation course can run into the thousands or tens of
thousands of dollars, most plans pass along the same 20% coinsurance rather than a flat copay, and there is no
per-visit ceiling on that percentage. Only the annual MOOP eventually stops it.
That plays out fast. A chemo regimen billed at $15,000 per session means a 20% coinsurance bill of $3,000 — for
that one visit. Two or three sessions into a treatment course, someone can already be at or near the full MOOP,
especially once office visits, imaging, and lab work from the same diagnosis are added in. This is exactly why
some clients reach their MOOP within just a month or two of starting chemo, not gradually over the year.
Other Part B drug categories, like routine injectable treatments for macular degeneration, tend to be lower-cost
per visit and are more often billed as smaller, capped copays rather than straight coinsurance. Even a modest
capped copay, charged monthly, can still add up to several thousand dollars a year on its own. But chemo and
radiation are the categories most likely to push someone toward their MOOP in a matter of weeks rather than
months, because the coinsurance scales directly with the cost of the treatment.
Now compare either scenario to Original Medicare paired with a Medicare Supplement plan like Plan G. Once
the annual Part B deductible ($283 for 2026) is met, Plan G covers 100% of the remaining Part A and Part B
coinsurance — including that same chemo coinsurance, every single time, for the rest of the year. In this
scenario, the person’s total out-of-pocket exposure for treatment is the one-time $283 deductible, not $3,000 per
session accumulating toward a MOOP that can still run close to $10,000.
This is exactly the kind of situation where the math can favor a Medicare Supplement even though its monthly
premium runs higher than a Medicare Advantage plan’s premium. If you already know you’re facing an
expensive, ongoing Part B drug treatment like chemotherapy — not a one-time event, but something recurring
over weeks or months — it’s worth running the full-year numbers on both paths rather than assuming a low or $0
Medicare Advantage premium is automatically the better deal.
Premium vs. MOOP: A Real Example
Two plans, same service area:
Plan A: $0 monthly premium, $9,250 in-network MOOP
Plan B: $55 monthly premium, $3,000 in-network MOOP
In a light year with just routine checkups, Plan A wins easily — no premium paid, and low utilization means the
high MOOP never comes into play. But picture a year that includes a hospitalization or an extended course of
specialist care. Plan B’s total annual premium cost is $660 (12 months at $55), and the family’s total exposure is
capped at $3,000. Plan A’s family could be exposed to as much as $9,250. There’s no universally right answer
here — it depends entirely on your current health, anticipated needs for the coming year, and how much risk
you’re comfortable carrying.
A Framework for Evaluating MOOP When Comparing Plans
Don’t stop at the premium. A $0 premium plan with a high MOOP can cost far more in a bad year than a
modest-premium plan with a low MOOP.
Check whether the plan is HMO or PPO. If it’s a PPO, look at both the in-network and combined figures —
not just the smaller number.
Ask where the plan’s MOOP falls in the Lower/Intermediate/Mandatory range. A plan sitting near the
mandatory ceiling generally means less protection if your health needs increase.
Factor in your actual health picture. Chronic conditions, upcoming procedures, or a recent diagnosis all
make a lower MOOP more valuable, even at a higher premium.
Remember what’s excluded. Your MOOP protects you on medical costs — not premiums, not Part D drug
spending, and not necessarily out-of-network care on an HMO.
Frequently Asked Questions
What is the Medicare Advantage MOOP for 2026?
For 2026, the mandatory in-network MOOP ceiling is $9,250. PPO plans that also cover out-of-network care have
a combined in-network-plus-out-of-network ceiling of $13,900. Individual plans can — and many do — set their
MOOP lower than these maximums.
Does Original Medicare have a MOOP?
No. Original Medicare (Part A and Part B) has no annual cap on out-of-pocket costs, which is why most people
pair it with a Medicare Supplement plan or other coverage.
Does the MOOP include my prescription drug costs?
No. Part D prescription drug costs are tracked and capped separately from the Medicare Advantage MOOP.
Does the MOOP include my monthly premium?
For 2026, the mandatory in-network MOOP ceiling is $9,250. PPO plans that also cover out-of-network care have
a combined in-network-plus-out-of-network ceiling of $13,900. Individual plans can — and many do — set their
MOOP lower than these maximums.
What’s the difference between a plan’s in-network MOOP and combined MOOP?
The in-network MOOP caps what you pay using the plan’s network providers. The combined MOOP, which
applies mainly to PPOs, caps your total spending across both in-network and out-of-network care combined, and
is set higher to reflect the added flexibility.
If I choose an HMO, do I have any out-of-network protection?
It depends entirely on the specific plan. Many HMOs cover out-of-network care only for emergencies or urgent
care, meaning routine out-of-network costs aren’t subject to any MOOP protection at all. Always confirm this
directly with the carrier before assuming you’re covered
Is a lower MOOP always better?
Not necessarily — it depends on your health and how much you’re willing to pay upfront. A lower MOOP plan
often comes with a higher monthly premium, so it protects you more in a high-cost year but may cost more
overall in a low-utilization year. The right choice depends on your specific health outlook.
I need regular Part B drug treatments, like chemo, infusions, or injections — is Medicare Advantage or a Medicare Supplement the better choice?
It depends heavily on the type and cost of the treatment. Chemotherapy and radiation coinsurance under
Medicare Advantage isn’t capped at a low flat dollar amount — plans generally pass along the same 20%
coinsurance Original Medicare charges, and since chemo can cost thousands of dollars per session, that 20% can
add up to the full MOOP within just a few treatments. Lower-cost Part B drug categories, like routine injections,
are more often billed as smaller capped copays, but even those can add up to several thousand dollars a year on
their own. Under a Medicare Supplement like Plan G, once you meet the annual Part B deductible, that same
coinsurance is covered at 100% for the rest of the year, every time — regardless of how expensive the treatment
is. For someone facing an expensive, ongoing Part B drug treatment, the total annual cost can end up
dramatically lower with a Medicare Supplement, even though its monthly premium is higher than a Medicare
Advantage plan’s. It’s worth running the actual numbers for your specific treatment and diagnosis rather than
assuming the lower monthly premium wins.
When should I check my plan’s new MOOP for next year?
Every fall. Carriers mail an Annual Notice of Change (ANOC) each September, which spells out any changes to
your plan’s premium, MOOP, copays, deductible, and covered drugs for the following year. It’s worth reading
closely each year rather than filing it away, since these numbers can shift even when your premium doesn’t
I’m Here to Help
Understanding your MOOP is one of the most overlooked parts of comparing Medicare Advantage plans, and it’s
exactly the kind of detail I go over with every client — not just what a plan costs today, but what your actual
financial exposure looks like if your health changes during the year. If you’d like help understanding your
current plan’s MOOP, or comparing it against other options ahead of this year’s Annual Enrollment Period, give
me a call. That conversation is always free.
Mike Miligi — Owner, Michael M Insurance Services
For over 10 years, Mike has helped seniors and other Medicare-eligible individuals understand their options,
including Medicare Advantage Plans (Part C), Medicare Supplement Plans (Medigap), Prescription Drug Plans
(Part D), and dental and vision programs. Mike is licensed in seven states and certified with 11 insurance
carriers. As an independent Medicare health insurance broker, he works for the client, not the insurance
carriers, providing accurate, unbiased options. Mike recertifies with CMS annually and completes continuing
education to stay current on industry standards
RELATED TOPICS-
Guide to Your Medicare Card | What It Covers – Michael M
Medicare Supplement (Medigap) Plans NY | Quote – Michael M
Medicare Advantages Plans – Michael M Insurance Services
Medicare Part D – My medicare mike
INFO SOURCES-
https://www.ncoa.org/article/what-you-will-pay-in-out-of-pocket-medicare-costs-in-2026/
What Does MOOP Mean? Guide to Medicare Advantage Limits – Medicare.org
https://ritterconsumer.com/blog/understanding-your-medicare-advantage-moop-limit
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