Covered California Certified Enroller Practice Exam

What type of expenses must members pay in full until they meet the out-of-pocket maximum with a Catastrophic plan?

1. Day-to-day medical expenses

2. Emergency room visits

3. Prescriptions

4. All health-related expenses

The correct answer is: Day-to-day medical expenses

In a Catastrophic plan, members are responsible for paying the full cost of day-to-day medical expenses until they reach the out-of-pocket maximum. This is because Catastrophic plans are designed primarily for young adults and individuals who want to protect themselves against very high costs while maintaining lower premiums. Such plans typically have high deductibles, and routine medical expenses—like doctor visits, preventive care, and possibly other day-to-day needs—must be paid entirely by the member. Until the out-of-pocket maximum is met, these members bear the financial responsibility for everyday health services. Emergency room visits and prescriptions may have different cost-sharing arrangements, which can include lower copayments after a deductible has been met, or they may be covered differently. Therefore, the responsibility for day-to-day medical expenses stands out as a key characteristic of how Catastrophic plans function in relation to out-of-pocket maximums.