What Is Major Medical Insurance Coverage?

Major medical insurance is the term used to refer to one particular type of what is generally referred to these days as fee-for-service or indemnity health insurance.

Increasing health costs these days mean that we are increasingly moving away from traditional types of medical insurance and the original fee-for-service medical insurance plan is rapidly being replaced by a number of other plans including HMO (health maintenance organization) plans, PPO (preferred provider organization) plans and POS (point of service) plans.

In effect fee-for-service medical insurance plans are intended to provide cover for unforeseen medical expenses resulting from injury or illness and give policy holders extensive freedom in picking where treatment is sought and by whom such treatment is provided. Fee-for-service policy holders are also generally responsible for making payment for treatment and for subsequently claiming back the cost from their health insurer.

The newer plans by contrast focus far more on routine health care with the goal of avoiding unnecessary costs by keeping policy holders in good health and spotting problems at a very early stage when they are hopefully easy to deal with. These newer plans ease administration for policy holders but at the same time take away a lot of the freedom to decide where and from whom treatment may be received.

The majority of people these days will be covered by the newer types of medical insurance rather than by traditional fee-for-service plans chiefly not only because of their reduced cost but also because there is far less administration when it comes times to make a claim on your policy. In addition, a rising number of employers who provide group health insurance plans for their employees are also picking these newer plans. Nevertheless, there is still a substantial number of people who prefer the freedom of choice which a fee-for-service policy gives them and it is here where you might want to think about major medical insurance coverage.

Fee-for-service policies provide three forms of coverage; basic health insurance, major medical insurance and comprehensive insurance.

Basic health insurance policies vary from one insurance company to the next but will generally cover hospital care (including the cost of room and board), some hospital services (such as x-rays and medication), surgery (whether carried out in hospital or at another suitable surgical center) and some doctors visits.

By contrast major medical insurance policies are intended to cover the treatment of high cost and long-term illnesses and injuries as well as in and out-patient expenses associated with these illnesses and injuries.

Comprehensive cover is simply a policy which includes both basic and major medical coverage.

Perhaps not surprisingly major medical insurance plans are a popular choice as most people are quite happy to bear the day to day expense of health care but are worried about how they would cope in the event of a major illness or accident which could involve large medical expense which could drag on for months or years.

Regrettably, the security and choice provided by major medical insurance is reflected in the cost of fee-for-service policies generally and thus it is becoming more and more of an option which a lot of people would like to choose but which is simply too expensive.

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