Medical insurance coverage protects you in the event of a serious illness or accident. Because several types of coverage exist, you should thoroughly review the plans available to determine which one provides the best coverage. The right coverage for you will depend on your family size, financial situation and medical history.
Major Medical
Major medical insurance plans cover outpatient care and hospital stays. This type of plan also may cover medications, nursing home costs, ambulance services and home health care services. Types of major medical plans include health maintenance organizations, preferred provider organizations and fee-for-service organizations. Some of these plans require you to pay a deductible, which is the out-of-pocket money you pay for medical care before the insurance plan covers any services. You may also have to pay co-pays for each service or select a primary care physician to coordinate your medical care.
Hospital and Surgical
Hospital and surgical plans cover only inpatient hospital care or outpatient surgery. They do not cover prescription drugs, preventive services or other medical expenses. This type of policy pays for your care based on the cost of the services you receive. You may have to pay a co-payment for medical services before the plan provides 100 percent coverage.
Short-Term Major Medical
Short-term major medical plans cover the same services as a major medical plan, but the coverage lasts for a short period of time. The State of Tennessee Department of Commerce and Insurance explains that these policies usually only cover a period of six months to one year. This type of policy does not cover pre-existing conditions, conditions that you have before applying for a new insurance policy. Examples of pre-existing conditions include Alzheimer's disease, diabetes, and HIV/AIDS.
Limited Benefit
Limited benefit policies cover specific illnesses, such as stroke and cancer, and will not cover any other medical expenses. The Alaska Department of Commerce, Community and Economic Development reports that these policies require you to wait a specific amount of time before your insurance company will pay any expenses. Many of these policies also require that you survive a specific period of time after your diagnosis. Because these plans do not provide major medical coverage, you should purchase another type of plan to cover preventive care, emergency medical expenses and other health-care costs.
Supplemental
Supplemental insurance plans cover medical expenses not covered by other insurance plans. For example, Medicare users may purchase supplemental insurance coverage for the expenses not covered by Medicare plans. This reduces the amount of money you pay out of pocket for your medical expenses.
Accident
Accident policies do not cover illnesses or preventive care. Instead, they only cover injuries sustained in accidents. You may have to pay a deductible for your medical care before an accident policy pays for any services. You may also have to pay for a percentage of your care once the policy starts covering your medical services.
Hospital Indemnity
Hospital indemnity policies cover inpatient hospital stays only. Because this type of plan only plays a flat daily amount for your care, it does not provide comprehensive coverage. Hospital indemnity plans work best when used as a supplement to a major medical plan.
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