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Major Medical Health Insurance

Major medical health insurance provides minimum essential coverage for preventative care, illness, and hospitalization. Families and individuals who don’t have access to employer-provided coverage can obtain quality major medical plans via the Federal Marketplace or with the help of an insurance broker or company. Availability for plans may vary based on your geographical location, and keep in mind that where you purchase a plan can impact the cost of your premium. 

What Is Major Medical Health Insurance?

Major medical health insurance is designed to provide preventative care, hospitalization, and illness coverage. Major medical or catastrophic policies for individuals and families must comply with ACA (Affordable Care Act) regulations and provide minimum essential coverage and will basically cover you for any major claims no matter the cost.

Major medical plans can come from your employer, the Marketplace, or through insurance companies directly. These plans are essential because they provide enrollees with full coverage at lower out-of-pocket costs, but be careful choosing because some are Catastrophic and require high deductibles. 

It’s also worth noting that major medical doesn’t include programs such as fixed indemnity, critical illness, limited benefit, or supplemental accident plans, as none of these are ACA regulated. 

What Is Covered By Major Medical Health Insurance?

As we mentioned, major medical covers everything from preventative care to severe illness and injury. The ACA requires that every major medical plan cover a wide array of preventative services within three categories that include women, children, and adults. Such preventative measures include health screenings, immunizations, and these essential benefits: 

  • Hospitalization
  • Emergency services
  • Ambulatory patient services
  • Prescription drugs
  • Laboratory services
  • Maternity and newborn care
  • Habilitative and rehabilitative devices and services
  • Substance use and mental health services
  • Pediatric services, including vision and oral care
  • Disease management, wellness, and preventative services

These health insurance policies can last up to 12 months and even longer. They are also renewable and cover emergency services such as ambulance rides following sudden injury or illness and costs related to hospitalization such as anesthesia and surgery. 

Does Major Medical cover preexisting Conditions?

All major medical health insurance that’s ACA-compliant covers preexisting conditions because companies cannot refuse coverage or charge more in these situations under the current health law. Hence, when you shop in the Marketplace, each of these plans covers any preexisting condition you already have before beginning a new policy. And the best part is that once you’re enrolled, the plan cannot raise your rates or deny coverage based on your health alone. 

The Exception to this Rule

Grandfathered plans are the only exception to the rule concerning preexisting conditions. So, if you purchased a policy before March of 2010 through an agent, broker, or insurance company, and it’s still active – you may not have the same protections and rights as with newer ACA-backed policies.

How Much Does Major Medical Health Insurance Cost?

As you may already know, there are many factors that contribute to the cost of healthcare coverage, including the type of plan you choose, the services you require, and whether or not you take prescriptions regularly.

When calculating the cost of major medical health insurance, be sure to look beyond what you’re paying each month for the premium. Most times, major medical policies with low premiums are offset by other costs such as cost-sharing or higher deductibles, or even higher limits on your out-of-pocket limits. 

Based on a recent study by eHealth, these are the average costs for major medical health insurance from 2020: 

Average Monthly Premiums

  • $456 monthly for individuals
  • $1,152 monthly for families

Average Deductibles

  • $4,369 yearly for individuals
  • $8,439 annually for families

Types of Major Medical Health Insurance Plans

There are numerous options for major medical health insurance plans for families and individuals, with each being designed for various needs. It helps to understand the differences with each policy, so you know what you’re getting. Here are the four most common major medical plans you’ll find in the Marketplace: 

EPO – Exclusive Provider Organization

These are managed care plans where the only services eligible for coverage are those completed in-network or via the plan’s network of medical providers. The only out-of-network services covered are emergencies. 

POS – Point of Service

A point of service plan allows you to pay less for services performed by hospitals, clinics, and doctors that belong to the policy’s network. These plans are different from others because they require enrollees to obtain referrals from primary care doctors before they can see a specialist. 

HMO – Health Maintenance Organization

An HMO puts a great deal of focus on wellness and preventative care, but for them to maintain their costs, these insurance plans usually require you to get coverage from doctors who are contracted by or work for the HMO. The only exception with out-of-network care is in the case of emergencies. You should also know that HMOs may be location-based, where you have to live or work in a specific area to be eligible for coverage. 

PPO – Preferred Provider Organization

PPO health plans allow you to pay less when using providers within the plan’s network. Yet, if you want, you can also opt to use providers that are not in the network with no referral for an extra cost. 

Is Medicare Major Medical Health Insurance?

Yes, Medicare is major medical health insurance. This type of healthcare offers several plans, including ones that you can purchase privately, obtain through the ACA Marketplace, or are provided with from an employer. Much like private plans, government-backed plans such as Medicaid and Medicare are also considered major medical and offer the same benefits discussed above. Yet, since the states partly manage these programs, it’s essential to check the local rules for eligibility in your area. 

The Bottom Line

At the end of the day, any healthcare plan that covers all aspects of care from preventative to illness and injury is considered major medical health insurance. It’s the best form of insurance to have because it covers most problems that can arise and is affordable for most people. If you’re not currently covered, there’s no better time to start looking!