Prior to 2014, some health plans had caps on the amount that they would pay in any given year. Even if the lifetime maximum benefit of the plan had not been reached, if the insured’s claims reached the annual limit, the insurance would stop paying claims for the rest of the year.
The ACA prohibits this practice for all essential benefits. There was a transition period between 2010 and 2013 when annual limits were being phased out, but as of 2014, all non-grandfathered plans had to eliminate annual caps on the amount that the insurer would pay for essential health benefits (grandfathered plans can still have annual limits on essential health benefits).
In the past, health plans designed for college students typically had very low annual limits. Student plans also had to do away with annual limits as of 2014, but during their transition period leading up to 2014, they were still allowed to impose a $500,000 annual limit, which was much lower than the annual limits that were permitted for regular individual market plans during the transition to 2014.