Major medical coverage has another feature, coinsurance. This means that the insurer and the insured share in any expensive above the deductible amount. The insurer will always carry the bulk of expenses and normally pays 80% and the insured pays 20%. Other proportions may be used so it is important that you read your policy thoroughly.
Some policies dictate that certain types of medical expenses are not subjected to the deductible while other types are. For example it is non uncommon for no deductible to apply to initial hospital and/or surgical expenses up to a specified amount. In a case like this, the insured would pay no deductible in expenses but would first pay the deductible before major medical covered any additional expenses. The insurer and insured would then share in the remaining expenses at 80% and 20% or whatever the percentage is in their applied policy.
It is becoming more common for major medical polices to include a “stop-loss limit.” This limit would be a dollar amount that, when reached, the insured no longer participates in any further payment.
This is generally referred to as a stated maximum benefit. The lifetime maximum limits on health insurance might range from $100,000 to $1,000,000. Some policies can even have unlimited benefits. Just as the maximum benefit can vary, so can the amount of the stop-loss limit depending upon the insurer.
Supplemental major medical benefits supplement a basic policy that includes hospital, surgical and medical with an additional policy that covers the broader range of medical expenses.
Usually the basic plan will pay covered expenses with no deductible up to the policy limit. Beyond that limit, the supplemental policy operates the same as a comprehensive policy that provides no other first dollar coverage. This means that after the basic policy limits are exhausted, a deductible kicks in followed by the major medical coverage.
Just as the comprehensive major medical policy, a supplemental plan will more than likely include stop-loss limit as well as a maximum benefit limit.
