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More Info on Medical Claims, Benefits, Insurers & Much More

Part 1: The Basic Tools, Chapter 2: Understanding the Language of Health Insurance Page 14

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For example, let's assume that you go to the doctor be cause you've injured your ankle, and the doctor takes an X-ray. If your policy has a deductible, as most policies do, and if this is your first visit to a doctor for the calendar year, the policy may not provide reimbursement for the doctor's visit since the yearly deductible has not yet been met. However, the policy may nevertheless provide reimbursement for the X-ray under the basic benefits provision.

Major medical benefits refer to coverage for treatment by a doctor and for medical tests that are not covered under the basic benefits portion of the policy. Treatment in a hospital emergency room, same-day surgery at a hospital center, or medical tests conducted in a hospital setting on an outpatient basis are often included under the major medical provision, as well. Such hospital-based treatments and tests are not generally considered part of inpatient care cven though they may take place within a hospital -- because the patient is not sched uled to stay overnight.

Depending on the policy, major medical claims may be reimbursed by the insurer at the 50%, 60%, 70%, or 80% rate, with the 50%, 40%, 30%, or 20% balance paid by the individual. Such policies are sometimes described as 50/50, 60/40, 70/30, or 80/20 plans. The first number refers to the percentage of the bill for which the insurance policy will generally provide reimbursement; the second number refers to the percentage of the bill that is generally paid for by the consumer. For example, if a doctor's bill is $100 and the insurance policy provides for payment of major medical claims at the 80% rate (an 80/20 plan), the insurer will generally provide reimbursement of $80. You will be expected to pay the $20 balance (the co-payment or co-insurance amount).

Major medical benefits don't generally begin until you have met the yearly deductible. However, that deductible is usually separate from the deductible established for hospital or surgical benefits. Thus, although you may have been in the hospital earlier in the year, you may still need to meet the yearly major medical deductible separately. In the same way, although you may have already met the major medical deductible for the year, you may still need to meet a separate hospital-surgical deductible -- if your policy includes such a deductible -- if you are hospitalized.

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