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Life and Health Insurance Agency

The purpose of a medical insurance policy is to reimburse the insured, fully or in part, for the medical cost of treating an illness or disability. Medical expense insurance policies are offered in various forms of coverage including hospital expense, surgical expense, miscellaneous medical expenses, major medical expense, comprehensive medical expense, dental expense, as well as other limited medical expenses.

• Basic Hospital Expense - This type of policy provides benefits for room and board expenses, miscellaneous medical expenses including the cost of x-rays, diagnostic test, ambulance services, lab fees, drugs, medicines, operating room charges, nursing services, and doctor visits in the hospital. If the policy is written on an indemnity basis then the insurer will pay a specified amount per day with maximum number of days paid. If a reimbursement or expense-incurred basis coverage is written then the insurer pays for all or a percentage of the expenses incurred.
• Surgical Expense - Providing compensation for the cost of surgery, this policy is usually covered along with hospital and miscellaneous medical expenses and the benefits pay for surgery charges as assessed by the surgeon. A schedule of reimbursement amounts are specified in the policy with the most common method of establishing a maximum limit for coverage. Other surgical procedures are listed as well, with a fix amount or percentage of the maximum shown.
• Miscellaneous - Benefits provided with basic medical expense insurance may include maternity, mental illness, private nursing, nursing home care, and physician expenses other than surgical expenses.
• Basic Medical Expense Exclusions - As with most health insurance policies, there are exclusions such as; preexisting conditions, injuries suffered while committing a felony, intentional self-inflicted injuries, injury or illness caused by acts of war, elective surgery for cosmetic purposes, conditions covered by workers’ compensation or by government plans such as Medicare.
• Limitations - Many basic medical expense policies will limit coverage for certain conditions and require a benefit waiting period for maternity, mental illness, alcohol or substance addictions, and preexisting conditions.
• Major Medical Policies - The high cost associated with advanced medical procedures requires insurance protection with the benefits of high maximum limits, blanket coverage, coinsurance, and a deductible. These are features of a major medical insurance policy.
• High Maximum Limits - of up to a million dollars are provided by a major medical policy.
• Blanket Coverage - in or out of the hospital, for all types of medical expenses.
• Coinsurance - is a provision, as specified in the policy, that after a deductible has been paid by the insured then a percentage of incurred cost will be paid by the insurer and the rest by the insured. The insurer is typically responsible for the largest percent and the most common coinsurance ratio is 80/20.
• Deductibles - are generally a set dollar amount, on a per individual or per family basis, to be paid before benefits go into effect. The provision of a policy deductible is an advantageous measure by which the insured is responsible for small claims to reduce cost.
• Internal limitations - as specified in the policy, restricted amounts payable for specific types of expenses.
• Common Accident Provision - allowed in some major medical policies, when more than one person of the same family suffers injury in the same accident then only one deductible is required.
• Exclusions - a typical major medical provision which excludes certain injuries or conditions from coverage as specified in the insurance policy.
• Stop-Loss - is a provision offered by some medical insurance providers to pay 100% of covered expenses when the insured’s out-of-pocket amount for eligible expenses reaches a specified amount.
• Comprehensive Major Medical Policies - Benefits provided by the comprehensive major medical policy are broader than those in a major medical. All of the basic medical expenses are included into this single policy ranging from hospital and surgical through major medical type coverages.

Major medical coverage is provided by two types of plans; a supplemental plan and a comprehensive plan.

• A Supplemental major medical policy covers expenses which are not included in a basic medical insurance plan. Supplemental policies pick up a specific coverage where the basic coverage ends.
• A Comprehensive major medical policy is a single major medical plan covering all expenses.