Major Medical Health Insurance Plans: Definition, Costs & More (2024)

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How much does major medical health insurance cost? What factors influence how much major medical insurance costs? How do you enroll in a major medical health insurance plan? Finding major medical insurance plans Finding major medical insurance plans for small businesses Related Articles FAQs References

A major medical health insurance plan is a type of plan thatmeets all of the minimum essential benefit standards of the Affordable Care Act(ACA or “Obamacare”). It also provides benefits for a broad range of inpatientand outpatient health-care services.

It’s important for you to understand that not all major medical health insurance plans can be purchased with a premium tax credit. However, enrollment in a major medical plan does protect you from tax penalties for being uninsured under Obamacare. Please note that as of the 2019 plan year, you’ll no longer pay a penalty in your federal taxes for going uninsured. However, state law varies, and you may owe a state tax penalty if you can afford the cost of major medical insurance but choose to go without it. Check out this article to see if your state requires health insurance.

How much does major medical health insurance cost?

Many factors will affect the cost of your health coverage,including the type of plan you enroll in, the services you need and how often,and whether you take prescription drugs.

What factors influence how much major medical insurance costs?

While major medical health insurance premiums rates can vary, fortunately the Affordable Care Act curbed some of the volatility of premium costs by eliminating factors such as gender and pre-existing health conditions (i.e., your current health status or medical history. Still, several factors will affect the actual cost of your major medical health coverage.

Age. In most states age is a major contributing factor in determining the premium rate for health insurance. (New York and Vermont are notable state exceptions where age is not a permissible determinant for premium rates.) Generally. the older you are, the higher your premium.
Location. Where you live affects the price of the premiums. Generally, premiums are lower in densely populated areas where numerous insurance companies are competing for business. Rural areas may be served by only one or two insurers and pay more for major medical health insurance.
Tobacco use. Tobacco use will affect how much health insurance costs you per month. In fact, health insurance companies can charge smokers as much as 50% more than non-tobacco users in most states.
Choice of plan. The insurance company and type of plan you choose will also affect your health insurance monthly premium. ACA major medical plans are classified by metal tiers: Bronze, Silver, Gold, Platinum and Catastrophic. Each metal tier carries different premiums based on the percentage of overall healthcare costs they cover.

When you’re calculating the cost of major medical insurance, it’s important to look beyond just plan premiums, or the monthly amount you’ll pay for coverage. Oftentimes, major medical plans with low premiums may be offset by other costs, such as high deductibles or a high maximum out-of-pocket limit. The maximum out-of-pocket limit serves as a safety-net, capping your annual out-of-pocket costs for covered services. If you reach this limit, your major medical health insurance plan typically pays 100% of the costs for covered services for the balance of the year.

How do you enroll in a major medical health insurance plan?

The Open Enrollment Period for major medical health insurance occurs each year, starting November 1^st for coverage that begins January 1^st the following year. Depending on your situation, you may be eligible for a Special Enrollment Period if you have lost your current health insurance, moved, married, had a baby, or similar life changes. You can enroll online via Healthcare.gov or your state’s marketplace if your state has its own health insurance exchange, through a private health insurance exchange, such as eHealth, or by directly contacting a health insurance company or health insurance broker.

Finding major medical insurance plans

At eHealth, it’s our goal to make finding health coverage as simple and painless as possible. Our plan finder tool makes it easy to browse major medical plans from top insurance companies and compare benefits and costs side by side. Remember, health insurance prices are fixed, so you’ll never pay more at eHealth than you would elsewhere.

To get started finding health coverage that fits your needs, enter your zip code in the tool on this page. If you need assistance, call us during business hours to reach an expert licensed insurance agent, who will be happy to help you.

Finding major medical insurance plans for small businesses

For business owners looking for major medical plans, eHealth is here to partner with you, as well. You’ll need at least one employee to be eligible for small business health coverage, and you must contribute to workers’ premiums.

The good news is that you can shop for small business plans at any time of the year and eHealth’s licensed brokers can help you find the right plan for you and your employees. Check out all the available small business health insurance plans, or contact us today to get guidance on finding the right coverage for your business.

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Major Medical Health Insurance Plans: Definition, Costs & More (2024)

FAQs

What is the definition of major medical insurance coverage? ›

Major medical insurance is the type of coverage typically offered through a workplace and the Affordable Care Act (ACA) marketplace. This type of insurance covers the majority of health care services and procedures you might encounter in a given year, including: Preventive care. Emergency room care. Urgent care.

What are the 4 most common health insurance plans? ›

Preferred provider organization (PPO) plan. Health maintenance organization (HMO) plan. Point of service (POS) plan. Exclusive provider organization (EPO)

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What does a major medical policy typically contains? ›

Major medical plans typically cover a broad list of medical expenditures, including hospital expense, surgical expense, physician (non-surgical) expense, private duty nursing, diagnostic X-ray and laboratory services, prescription drug expense, artificial limbs and organs, ambulance services, and many other types of ...

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What are the different types of costs in health insurance? ›

Deductibles, copayments, and coinsurance can add a lot to your total yearly costs - sometimes more than a plan's premium. When you compare plans, you can get a more accurate estimate of your total yearly costs for each plan, based on the level of care you think your household will use for the year.

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How many types of major insurance are there? ›

The most important types of insurance are auto, home, renters, umbrella, health, long-term care, disability and life. Assessing your personal insurance needs and budget constraints with an insurance agent can help you determine which policies to buy and how much coverage you need.

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What is the difference between indemnity and major medical insurance? ›

Major Differences

Traditional major medical insurers and short-term insurance plans pay doctors, hospitals, pharmacies and other healthcare infrastructure for covered expenses such as treatments, procedures, prescriptions, etc. whereas fixed indemnity coverages typically pay policyholders directly.

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What is better, HMO pos or PPO? ›

PPO health insurance allows you more freedom to get care anywhere, while a POS plan may allow out-of-network care but demand a primary care referral. A PPO health insurance plan doesn't typically require that you name a primary care provider to oversee your care.

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Which is the most restrictive type of healthcare plan? ›

HMOs are known for their provider networks and lower costs. They are also restrictive and don't cover out-of-network care unless it's an emergency. PPOs offer more flexibility and allow out-of-network care, but that type of care typically comes with a higher cost.

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What are the three types of insurance everyone should have? ›

Types of Insurance Coverage You Need

Life insurance. Homeowners or renters insurance. Long-term disability insurance.

What is not covered under major medical policies? ›

Health insurance typically covers most doctor and hospital visits, prescription drugs, wellness care, and medical devices. Most health insurance will not cover elective or cosmetic procedures, beauty treatments, off-label drug use, or brand-new technologies.

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Who would major medical insurance be the best option for? ›

Major medical coverage is a good choice for nearly anyone who wants to minimize expenses for preventative care, emergency services, and management of chronic conditions.

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Which of the following is generally covered in a major medical plan? ›

Major medical insurance provides coverage for illnesses and injuries, along with preventive care. Basic hospital and surgical policy benefits are usually included also. The ACA requires all major medical plans to cover an extensive list of preventive services that includes services for vaccines and screenings.

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What is the most expensive health insurance? ›

Platinum health insurance is the most expensive type of health care coverage you can purchase. You pay low out-of-pocket expenses for appointments and services, but high monthly premiums. Plans typically feature a small deductible or no deductible and cheap copays or coinsurance.

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Which is the least expensive type of health insurance? ›

Medicaid is the cheapest health insurance if you have a low income. Eligibility varies by state. In most states, you have to make less than about $20,782 per year as a single person to qualify. A family of four has to make less than $43,056 per year.

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What is a good annual deductible for health insurance? ›

A plan that has a deductible of at least $1,400 (for individuals) or $2,800 (for a family) is considered a high-deductible plan. If your insurance plan has a low deductible, this means you may reach the threshold earlier and get cost-sharing benefits sooner.

What is the difference between short term health insurance and major medical? ›

A short-term health insurance plan provides limited, but affordable benefits when compared to a major medical plan that meets all of the benefit requirements of the Affordable Care Act (ACA). When it comes to health insurance, people have more options than ever.

Which of the following is not characteristic of a major medical plan? ›

The characteristic that is NOT associated with a Major Medical Expense policy is first dollar coverage. These policies usually include deductibles, co-insurance, and high coverage limits, whereas first dollar coverage does not require an initial out-of-pocket payment by the policyholder.

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What is the major medical policy coinsurance? ›

The percentage of costs of a covered health care service you pay (20%, for example) after you've paid your deductible. The maximum amount a plan will pay for a covered health care service. May also be called “eligible expense,” “payment allowance,” or “negotiated rate.”

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What does it mean when a major medical policy provides first dollar coverage? ›

First dollar coverage is a type of insurance policy with no deductible where the insurer assumes payment once an insurable event occurs. While there is no deductible, the amount the insurer will pay out is often lower than on similar plans that have a deductible, or premiums for the first dollar plan will be higher.

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