DEFINITIONA cap, or limit, on the benefits your insurance company would pay in a year while you were enrolled in a particular health insurance plan. These caps were sometimes placed on particular services such as prescriptions or hospitalizations. Annual limits were placed on the dollar amount of covered services or on the number of visits that were be covered for a particular service. After an annual limit was reached, you had to pay all associated health care costs for the rest of the year. Under the new health care low, insurance companies cannot set yearly limits, so you do not have to worry about this happening.