Out-of-Pocket Maximums: How Generic Copays Count Toward Deductibles in Health Insurance

Ever paid $10 for your blood pressure med and thought, "At least this is getting me closer to my deductible"? You’re not alone. Millions of people assume that every copay they make-whether for a doctor visit or a generic pill-counts toward their deductible. But here’s the truth: generic copays usually don’t count toward your deductible. They do count toward your out-of-pocket maximum. And that difference can cost you thousands if you don’t understand it.

What’s the difference between a deductible and an out-of-pocket maximum?

Your deductible is the amount you pay for covered services before your insurance starts sharing the cost. For example, if your plan has a $2,000 deductible, you pay the first $2,000 of medical bills yourself. After that, you might pay 20% coinsurance while your insurer pays 80%.

Your out-of-pocket maximum is the most you’ll pay in a year for covered care. Once you hit that limit-no matter what kind of costs you’ve paid-your insurance covers 100% of everything else for the rest of the year. In 2025, the max for an individual is $9,200. For families, it’s $18,400.

Here’s the key: all your in-network costs-deductibles, coinsurance, and copays-add up to your out-of-pocket maximum. But only some of them count toward your deductible. And generic prescription copays? They almost never do.

Why don’t generic copays count toward your deductible?

This setup wasn’t always the case. Before the Affordable Care Act (ACA) took full effect in 2014, many plans didn’t count any copays toward anything. People with chronic conditions-like diabetes or high blood pressure-could pay $15 or $20 every month for their meds and still be nowhere near their deductible. They were stuck paying full price for everything else, even after spending hundreds or thousands on prescriptions.

The ACA fixed one big problem: it made sure all cost-sharing counts toward your out-of-pocket maximum. That means your $10 insulin copay? It adds up. If you’ve paid $8,500 in copays and coinsurance, you’re done paying for the year-even if you haven’t met your $2,000 deductible.

But the ACA didn’t merge deductibles and copays. Why? Because insurers and policymakers wanted to keep a financial "gatekeeper"-the deductible-to discourage unnecessary care. So now you’ve got two separate tracks:

• Deductible track: You pay full cost for services until you hit your deductible. Copays usually don’t move the needle here.
• Out-of-pocket maximum track: Every copay, coinsurance, and deductible payment adds up. Once you hit the max, you’re covered.

That’s why someone can pay $3,000 in generic copays over a year and still have a $0 deductible. They’re not "in the clear" for other care-they’re just done paying for everything else because they hit their out-of-pocket max.

How do different plan types handle prescription costs?

Not all plans work the same. There are three common structures:

1. Single deductible: One amount covers both medical and prescription costs. If you have this, your generic copays do count toward your deductible. But only 27% of employer plans use this model.
2. Separate medical and prescription deductibles: You have two deductibles-one for doctor visits, one for meds. You pay full price for prescriptions until you hit the prescription deductible. After that, you pay copays that count toward your out-of-pocket max but not your medical deductible. This is the most common model, used in 37% of plans.
3. Copay-only (no prescription deductible): You pay a flat copay for prescriptions right away, no deductible to meet. But again, those copays don’t count toward your medical deductible. This applies to 36% of plans.

So if you’re on a plan with separate deductibles and you’ve been paying $10 for your asthma inhaler every month, you’re probably not getting any closer to your $1,500 medical deductible. But you are getting closer to your $8,500 out-of-pocket max.

Real stories: What happens when people get confused?

People are getting burned by this confusion every day.

One user on HealthCare.gov wrote: "I paid $10 copays for my blood pressure meds all year. I thought I’d met my $2,000 deductible. Turns out I hadn’t. I still had to pay full price for my MRI." She paid over $2,500 in copays and still owed thousands more.

On Reddit, another person said: "I thought my $15 copay for my cholesterol med was helping me get to my deductible. I didn’t realize my plan had a separate prescription deductible I hadn’t met. I ended up paying $400 for a single prescription because I didn’t know I was still in the deductible phase."

A 2023 survey found that 68% of consumers believe prescription copays count toward their deductible. Only 22% know the truth. That’s a massive gap-and it leads to people skipping meds, avoiding tests, or getting hit with surprise bills.

On the flip side, people with chronic conditions are grateful for the out-of-pocket max. One user on PatientsLikeMe shared: "Before 2014, my insulin copays didn’t count toward anything. Now, I hit my $8,500 max last year. My meds were free for the rest of the year. That saved me over $3,000."

How to find out how your plan works

You can’t guess. You have to check.

Every plan must give you a Summary of Benefits and Coverage (SBC) before you enroll. Look for this section:

• "Does this payment count toward my deductible?"
• "Does this payment count toward my out-of-pocket maximum?"

It’s usually in a table. If it says "No" next to "Deductible" but "Yes" next to "Out-of-Pocket Maximum" for prescriptions-you’ve got the common split structure.

Also look for the Explanation of Coverage document. It’s longer, but it spells out exactly how each cost works.

Don’t rely on your pharmacy’s app or your insurer’s website. They often simplify things. The SBC is the only document legally required to be clear and standardized.

What’s changing in 2025 and beyond?

The government is trying to fix the confusion. In April 2024, the Department of Health and Human Services announced new rules for 2025 plans: insurers must clearly label how prescription costs count toward deductibles and out-of-pocket maximums.

Some insurers are testing "integrated deductible" plans-where prescription costs, including copays, count toward one combined deductible. Early results show patients stick to their meds 28% more often.

McKinsey predicts that by 2027, 60% of major insurers will offer at least one plan where generic copays count toward the deductible. But the American Hospital Association warns: simplifying this could raise premiums by 3-5%. So it’s a trade-off: simpler rules might mean higher monthly payments.

For now, the system stays complicated. But knowing how it works? That’s power.

What you should do right now

Here’s your action plan:

1. Find your plan’s Summary of Benefits and Coverage (SBC). If you can’t find it, call your insurer and ask for it.
2. Look at the table for "Prescription Drugs." Check the "Deductible" and "Out-of-Pocket Maximum" columns.
3. If copays say "No" for deductible but "Yes" for out-of-pocket max-you’re in the standard model. Don’t expect your meds to help you meet your deductible.
4. Track your yearly spending. Add up all your copays, coinsurance, and deductible payments. When you hit your out-of-pocket max, call your insurer to confirm your benefits reset to 100% coverage.
5. If you take multiple prescriptions, ask if your plan has a preferred pharmacy or mail-order option. Some plans offer lower copays for 90-day supplies.

Knowing this isn’t just about saving money. It’s about making sure you don’t skip a needed med because you think you’ve "paid enough." You might have paid a lot-but you’re still in the deductible phase. And that’s when you’re most vulnerable to surprise bills.

Out-of-pocket maximums were designed to protect you. But only if you understand how they work.