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Merritt Personal Lines Manual: Comprehensive Medical Expense Policies

As we've already seen, major medical coverage is considered hospitalization insurance. It doesn't cover all medical expenses -- the way that traditional indemnity coverage does. What does the insured do about these other expenses? Paying for them out-of-pocket is the simplest option. But the insured needs to be cash-rich to do this. So, most people will look for some kind of insurance to add on to their major medical.

In some cases, the answer may be to buy a comprehensive medical expense plan. This kind of insurance adds coverage for basic -- and not necessarily hospital-related -- medical expenses to the major medical coverage.

The comprehensive plan consists of a block of first dollar benefits followed by a deductible and a typical major medical plan. This plan might specify that 100 percent of the first $5,000 or $10,000 of reasonable and customary expenses will be covered. Once this bundle of first dollar benefits is exhausted, the insured must satisfy a deductible, usually referred to as a corridor deductible and then the major medical benefits are activated.

All of the provisions common to a basic hospitalization plan as well as the provisions and concepts related to major medical plans, i.e., deductibles, coinsurance, stop loss, etc., are found in this type of plan.

A regular major medical plan will do essentially the same job as the higher-priced comprehensive plan, unless the claim is relatively small ($10,000 or less). The first dollar benefits will cover the relatively small claim without any deductible or coinsurance.

In small claim situations, the extra premium for the comprehensive plan has to be weighed against the likelihood of a small claim of a few thousand dollars. By today's health care costs, it is difficult to spend a few days in a hospital, have surgery and not incur expenses exceeding $10,000.

Comprehensive plans vary, but generally cover the same kinds of services. Some of these include:

  • professional services of doctors of medicine and osteopathy and other recognized medical practitioners;
  • hospital charges for semiprivate room and board and other necessary services and supplies;
  • surgical charges;
  • services of registered nurses and, in some cases, licensed practical nurses;
  • home health care;
  • physical therapy;
  • anesthetics and their administration;
  • x-rays and other diagnostic laboratory procedures;
  • x-ray or radium treatment;
  • oxygen and other gases and their administration;
  • blood transfusions, including the cost of blood when charged;
  • medicine requiring a prescription;
  • specified ambulance services;
  • rental of durable mechanical equipment required for therapeutic use;
  • artificial limbs and other prosthetic appliances, except replacement of such appliances;
  • casts, splints, braces and crutches;
  • rental of a wheelchair or hospital bed.
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