Major medical insurance is a type of health insurance that caters to the cost of large medical costs.
It’s offered through your workplace, the Affordable Care Act (ACA), or could be purchased by you through an insurer or website to help cover your medical expenses and hospitalization.
What most of us have come to expect from health, such as offering comprehensive coverage, is that major medical insurance offers coverage to cover your costs, from doctor visits to your hospital stay to your surgeries and prescription drugs.
Other types of health care coverage aren’t as comprehensive as major medical. For instance, in most states, short-term health insurance provides coverage for a year and the grace to extend to more years.
And it offers a low premium, requires you to pay out of pocket when you need care, and comes with fewer benefits and consumer protections.
What Does Major Medical Insurance Cover?
The ACA marketplace requires that it cover all 10 major essential health benefits as stated by the federal government.
The essential health benefits include:
- Pediatric services
- Laboratory services
- Preventive and wellness services and chronic disease management
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Pregnancy, maternity, and newborn care
- Mental health and substance use disorder services
- Emergency services
- Hospital stays
- Ambulatory patient services
Birth control and breastfeeding coverage may not be listed as essential health benefits, but health plans in the ACA marketplace must provide them.
Types of Major Medical Insurance
- ACA Marketplace health insurance: ACA Marketplace health insurance is affordable coverage made available to individuals and families who cannot get coverage through an employer. Health insurance companies, such as private insurance companies, offer this type of comprehensive coverage. To purchase these insurance plans, visit the federal and state insurance marketplaces, and if you happen to qualify for advanced premium tax credits and subsidies, then you’ll pay less for an ACA plan. Only ACA plans give household income-related discounts.
- Employer-sponsored health insurance: This type of insurance is provided to groups of employees through health insurance coverage from an employer, and it typically offers an affordable and comprehensive health insurance option. It’s cheaper for employees, as they pay more than half of the premium costs.
Through an employer, employees get an average of $1,327 per year, which makes it $111 per month for health insurance. Each year, businesses pay an average of $6,584.
- Cobra: Cobra insurance allows you to extend your coverage for 18 to 36 months. For those who have coverage in a major medical plan at their place of work and then something leads to their being dismissed or leaving the job, Cobra Insurance can help extend their coverage for some time.
Cobra coverage is quite expensive as it provides you with the plan you had at work, but keep in mind that you are responsible for the full premium costs instead of having to split them with your provider.
- Medicaid: Medicaid is based on the income of people, as it is primarily for low-income Americans, eligible children, pregnant women, the elderly, and people with disabilities.
- Medicare: Medical care is primarily for adults 65 and older, but it also offers coverage for people with end-stage renal disease and younger people with specific disabilities.
- Students’ health plans: This type of health insurance is usually meant for college students, but it won’t be needed as federal law states that they should remain on their parents’ health insurance until they’re 26.
How to Get Major Medical Insurance
There are many ways to get major medical insurance, which include:
- Employer
- ACA marketplace
- Insurer or website
- Medicaid
- Medicare
- College or other institution of higher
These are the ways you can get major medical insurance.
Frequently Asked Questions
Do I need major medical insurance if I have regular health insurance?
Having both can provide more comprehensive coverage and protect you from high medical costs, but it depends on your needs and budget.
Are there different types of major medical insurance plans?
Yes, there are various plans with different levels of coverage and costs, such as high-deductible plans, PPOs, and HMOs.
How much does major medical insurance cost?
Costs vary based on factors like your age, location, and the level of coverage you choose, but premiums can range from a few hundred to several thousand dollars per year.
Can I buy major medical insurance on my own?
Yes, you can purchase individual plans through the healthcare marketplace, a broker, or directly from an insurance company.
What if I have pre-existing conditions?
Under the Affordable Care Act, insurance companies cannot deny coverage or charge you more due to pre-existing conditions.
How do deductibles work in major medical insurance?
A deductible is the amount you pay out-of-pocket before the insurance coverage kicks in. Higher deductibles usually mean lower premiums but more financial risk.
What does major medical insurance typically cover?
It usually covers hospital stays, surgeries, specialist consultations, medical equipment, and sometimes prescription drugs.
