Alyssa Lane
Medical insurance is a broad term for insurance coverage that pays for medical expenses incurred as a result of sickness or injury. Comprehensive medical insurance typically includes doctor visits, hospital care, tests, therapies, prescription drugs, and more. However, it's important to note that not all medical expenses are covered, and out-of-pocket costs may apply. The specific coverage varies depending on the insurance provider and the type of plan chosen. Some common types of plans include Health Maintenance Organization (HMO) plans, High-Deductible Health Plans (HDHP), and Health Savings Accounts (HSA). Additionally, public programs like Medicaid and Medicare provide coverage for certain individuals, and private insurance companies may offer supplemental policies to fill gaps in coverage. Understanding what is covered by your insurance plan is crucial to ensuring you receive the necessary care without unexpected financial burdens.
| Characteristics | Values |
|---|---|
| Doctor's visits | Covered by most comprehensive plans, but may require being part of an insurance network |
| Prescription drugs | Covered by most comprehensive plans, but may require being on a drug list (formulary) |
| Medical equipment | Covered by most comprehensive plans |
| Hospital stays | Covered by most comprehensive plans |
| Surgical services | Covered by most comprehensive plans |
| Emergency care | Covered by most comprehensive plans |
| Preventative care | Covered by some plans |
| Pre-existing conditions | Typically not covered |
| Chronic conditions | Typically not covered |
| Out-of-pocket expenses | Deductibles, co-insurance, and co-payments are typically required |
| Self-insured employers | May not cover essential health benefits |
| Public programs | Medicaid and Medicare are examples of public programs that provide health coverage |
| Limited-duration health plans | Prohibited in Illinois as of January 1, 2025 |
| Mental health | Coverage varies, but some providers offer specialized plans |
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What You'll Learn
Doctor's visits
Medical insurance can cover doctor's visits, but the specifics depend on the type of insurance plan and the network of doctors that have contracted with the insurance company. In the US, Medicare is a federally funded insurance plan that covers doctor's visits under certain conditions. Original Medicare is split into Part A, which covers hospital care, and Part B, which covers medically necessary and preventive doctor's visits. Medicare Part B covers 80% of the Medicare-approved cost of these visits, and individuals must pay the remaining 20% as coinsurance. This is after meeting the Part B deductible, which is $257 in 2025, after which Medicare begins to share in the cost of medical bills.
Medicare Part C, also known as Medicare Advantage, is an alternative to Original Medicare that is administered by private insurance companies. These plans must provide the same coverage level as Original Medicare, including doctor's visits, but there may be extra costs such as coinsurance and deductibles.
Medicare Supplement insurance plans can also help to pay for some out-of-pocket costs associated with Medicare Parts A and B, including doctor's visits. These plans come with a monthly premium.
It is important to note that not all types of doctors are covered by Medicare, and individuals should check their specific plan details to understand their coverage. To receive coverage, doctors must be Medicare-approved providers and accept assignment, meaning they have agreed to accept the Medicare-approved amount as payment in full.
In general, individuals with health insurance should consult their plan's network to understand which doctors and hospitals are included and what their out-of-pocket costs will be. Costs can vary depending on whether a doctor is in-network or out-of-network, and some plans will not pay anything if an individual sees an out-of-network provider.
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Prescription drugs
Before the Affordable Care Act (ACA), almost 20% of individual/family health insurance plans did not cover prescription medications. However, the ACA now considers prescription drugs an essential health benefit, and they are included in all individual and small-group health plans with effective dates of 2014 or later. Large-group employer health plans often include prescription drug coverage, too, with a 2013 Kaiser survey finding that at least 90% include some form of prescription drug coverage.
If you have Medicare, it's important to note that Original Medicare (Parts A and B) generally does not cover prescription drugs. However, there are some exceptions. For example, Part A covers drugs that are part of inpatient treatment in a hospital, and Part B covers injected and infused drugs, such as vaccines, given by a licensed medical provider. Medicare Part D was established to provide prescription coverage for Medicare enrollees, requiring the purchase of a private prescription plan.
When it comes to prescription drug coverage, each insurance company typically maintains a prescription drug list (also called a formulary) of brand-name and generic drugs it covers, including approved dosages. The cost of medications is usually divided into tiers, with the least expensive drugs in Tier 1 and the most expensive in higher tiers. Your health plan may also require you to try a less expensive medication before approving coverage for a more expensive drug. Additionally, prior authorization may be needed for certain prescriptions, meaning your healthcare provider must submit the prescription to your insurance before coverage is approved.
If your insurance company does not cover a specific prescription, you may be able to appeal the decision and have it reviewed by an independent third party. Alternatively, your doctor can confirm to your health plan that the requested drug is appropriate for your medical condition, outlining the ineffectiveness or harmful side effects of alternative drugs covered by the plan.
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Hospital stays
Health insurance typically covers a portion of a hospital stay, but the patient is often left to cover any costs that their insurance plan does not. These costs can be significant, especially for extended stays or specialised treatment. It is important to understand your insurance coverage and what you may be expected to pay out-of-pocket. Knowing your plan's deductibles, copays, and out-of-network costs can help you prepare for any financial burden.
Hospital indemnity insurance, or supplemental insurance, can help cover these out-of-pocket costs. This type of insurance provides a cash benefit if you are hospitalised due to illness or injury, and it can be used to cover expenses such as copays, deductibles, and even non-medical costs like childcare or transportation. It is important to note that hospital indemnity insurance does not pay medical bills directly but provides financial support to reduce the overall financial impact of a hospital stay.
During open enrollment, it is a good idea to review your health insurance options and understand the benefits and limitations of your plan. This can help you make informed decisions about your healthcare and ensure you have the necessary coverage in the event of a hospital stay.
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$72.77 $111.95
Pre-existing conditions
A pre-existing condition is a medical condition that one has before starting a new healthcare plan. Examples of pre-existing conditions include diabetes, chronic obstructive pulmonary disease (COPD), cancer, sleep apnea, lupus, epilepsy, and depression. Before 2010, insurance companies could deny coverage or offer coverage at inflated rates if one had a pre-existing condition. However, the Affordable Care Act (ACA), passed in 2010, made it illegal for insurers to deny coverage or charge higher rates based on pre-existing conditions.
If you have a plan that started before 2010, known as a "grandfathered plan", it may not cover pre-existing conditions. In this case, you have two options: switch to a Marketplace plan that covers pre-existing conditions during Open Enrollment, or buy a Marketplace plan outside of Open Enrollment and qualify for a Special Enrollment Period. It is important to note that health maintenance organization (HMO) plans may not cover out-of-network services outside of emergencies.
When choosing a health plan, consider your medical needs. If you have a pre-existing condition that requires frequent care, surgeries, or treatments, a plan with a higher monthly premium and lower deductible may provide better coverage and help manage costs. Additionally, some plans offer prescription drug coverage, so review the drug list to ensure any necessary medications are included.
Pregnancy is also considered a pre-existing condition, but insurers cannot deny coverage or charge higher rates due to pregnancy. Coverage for pregnancy and delivery begins from the day you enroll in a plan. Overall, while pre-existing conditions used to be a barrier to obtaining health insurance, the ACA has ensured that individuals with pre-existing conditions have access to affordable coverage.
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Surgical services
Medically necessary surgeries are generally covered by health insurance, but the extent of coverage depends on the specific policy's terms and conditions. It is crucial to understand the inclusions and exclusions of your policy before finalising a plan. The policy document outlines all the covered surgical procedures, and it is recommended to check this list to ensure you know what is covered and what is not. Some common medically necessary surgeries covered by insurance include appendectomies, hip replacements, and heart bypasses.
The cost of surgery can vary depending on factors such as the specific procedure, the hospital, the length of stay, and the level of treatment. It is important to note that insurance may not cover all associated costs, and there might be out-of-pocket expenses for the patient. These can include charges for durable medical equipment (e.g., crutches or braces), skilled nursing facility fees, and part-time nursing care or therapy during recovery at home.
To estimate the potential costs, it is advisable to ask the doctor, hospital, or facility about the expected expenses for the surgery and any necessary aftercare. Understanding your insurance coverage is essential, as some procedures might not be deemed medically necessary by your insurance provider, resulting in denied claims. Knowing the appeal process of your insurance plan is crucial in such cases.
Additionally, the choice of hospital and whether it is in-network or out-of-network can impact your out-of-pocket expenses. In-network providers are contracted with your insurance plan, and using their services can help avoid unexpected charges. Out-of-network providers might have different billing practices, and it is essential to understand how they handle the No Surprises Act, which aims to protect patients from surprise medical bills.
Overall, surgical services covered by medical insurance can provide financial protection and peace of mind for individuals facing medically necessary procedures. By understanding their insurance plans and selecting appropriate coverage, individuals can minimise out-of-pocket expenses and focus on their health and recovery.
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Frequently asked questions
Medical insurance covers medical expenses incurred as a result of sickness or injury. This includes doctor visits, hospital care, tests, certain therapies, and prescription drugs.
Comprehensive/major medical health insurance includes doctor visits, hospital care, tests, certain therapies, and prescription drugs. Most comprehensive policies require policyholders to meet annual out-of-pocket expenses such as deductibles and co-insurance.
Medical insurance typically does not cover pre-existing or chronic conditions. For example, ongoing health issues with no known cure, such as diabetes and asthma, are usually not covered.
A deductible is the amount you need to pay before your insurance company covers the cost of your care. Co-insurance is a fixed percentage of the claim that you must pay after meeting your deductible.
You can contact your insurance company's member services team to find out what is covered by your plan. You can also review your plan's formulary, or drug list, to see what prescription drugs are covered.
