Which plan is right for you?
There are many plans out there to pick from, but time and time again, it is always best to have a comprehensive major medical plan. A comprehensive major medical plan is the Cadillac of health insurance plans as it will give you more coverage for insurable incidents than any other type of plan. While a major medical plan is not always affordable or attainable for various reasons, it is the plan that you want you and your family to have.

MAJOR MEDICAL PLANS
Major medical insurance is a form of health care coverage that provides benefits for most types of medical expenses that may be incurred. Offering more complete coverage with fewer gaps, major medical insurance covers a much broader range of medical expenses - including those incurred both in and out of the hospital - with generally higher individual benefits and policy maximum limits. These more extensive medical insurance policies are divided into two general groups: comprehensive major medical insurance, in which the traditional basic coverages and essentially any other type of medical expense are combined into a single comprehensive policy; and supplemental major medical insurance, in which coverage begins with a traditional basic policy that pays first, with the major medical coverage added to pick up expenses left uncovered by the initial basic policy. Let's look at each of these groups and examine how the generally operate.

Comprehensive Major Medical
Most major medical policies begin paying benefits after the deductible is satisfied. The policy's deductible is considered satisfied as long as the insured individual can show evidence of having incurred and paid the necessary covered expense. There are essentially two classes of comprehensive major medical plans: those that provide first dollar coverage, and those that do not. With first dollar coverage, as soon as covered medical expenses are incurred, the policy immediately begins to pay benefits. Consequently, policies with first dollar coverage effectively have a deductible amount of zero. Without first dollar coverage, the insured must first pay out-of-pocket a specified deductible amount, and when that amount of incurred covered expenses has been paid, the policy will then begin to pay benefits.
As an example, let's assume that before Mr. A's major medical policy will pay anything, he must pay the first $400 of medical expenses each year. Mr. A does not have first dollar coverage; in other words, he must pay a deductible. Conversely, as soon as Mr. B was hospitalized with an acute illness, his major medical policy began paying for his expenses. He, therefore, does have first dollar coverage, and incurs no deductible.
Another important feature of major medical coverage is the concept of coinsurance, which is the sharing between the insurance company and the insured of any covered expenses that exceed the deductible amount. (In some regions, this is also known as percentage participation.) The insurer always carries the bulk of these expenses, usually paying 80% while the insured is responsible for the remaining 20%. Other proportions (as stipulated in the particular policy) may also be used, such as 75/25. Coinsurance works in this manner: Ms. C's major medical policy has a $200 deductible and 80/20 coinsurance. She incurs covered medical expenses totaling $1,200. Ms. C must first pay the $200 deductible. This leaves $1,000 of expenses to be shared on an 80%/20% basis, she being responsible for the lower amount, or an additional $200. The insurance company must pay $800 of remaining $1,000 (the 80% share). Ms. C, therefore, has to pay $400 of the total $1,200.
It should be mentioned that, in some policies, certain types of medical expenses are not subject to the deductible, while others are. It's not unusual, for instance, that the deductible be waived for initial hospital or surgical expenses up to a specified amount; say, for example, the first $5,000 of such expenses. In this case, the insured would pay no deductible (in essence receiving first dollar coverage on the first $5,000 of hospital and surgical expenses), but would then be required to pay the deductible amount before his or her major medical policy covered any further expenses. After satisfaction of the deductible, the insurer and the insured would share in paying the remaining expenses on an 80/20 allotment (or whatever percentage the policy states).
Most major medical policies today also include a stop-loss limit (or out-of-pocket limit), which is a dollar amount beyond which the insured no longer has to participate in the payment of covered expenses. After the insured's total deductible and coinsurance payments reach that amount, the insurance company picks up the entirety of any further covered expenses, up to a stated maximum benefit amount. Lifetime maximum benefit limits on current health care policies may range from $100,000 to $2 million, with some policies even having unlimited benefits. And just as the maximum benefit amount can vary considerably, so can the stop-loss limit, depending upon the individual policy and insurer.

Supplemental Major Medical
When a supplemental major medical policy is used, it typically backs up and enhances a basic policy that usually includes hospital, surgical and medical coverage along with an additional policy covering the broader range of medical expenses. Generally, the basic plan will pay covered expenses with no deductible, up to the policy's limit. Above that limit, the supplemental policy kicks in, operating in exactly the same manner as a comprehensive policy that does not provide first dollar coverage. In simpler terms, after the basic policy's limits are reached, the insured must pay a deductible, after which the supplemental major medical coverage begins to pay. Since the deductible actually occurs between the basic and supplemental policies, it's often referred to as a corridor deductible. Like the comprehensive major medical plan, a supplemental policy is likely to include a stop-loss limit and a maximum lifetime benefit limit.

Types of deductibles
There are a number of ways that deductibles can be administered in major medical policies. Some plans have a per-cause (injury or illness) deductible, while others may use an all-cause deductible. With a per-cause deductible, the insured pays one deductible for all expenses incurred from the same illness or injury. The benefit period for each "cause" (or occurrence) begins when the deductible for that particular injury or illness has been satisfied, and may run for one- to two years. Here's how it works: suppose that Ms. D suffered a major illness early in the year from which she continued to incur medical expenses through July. Then, in September, she was injured in an automobile accident that hospitalized her for two weeks. In addition to being quite unfortunate, Ms. D had to pay a separate deductible for each of these incidents because her policy has a per-cause deductible.
On the other hand, had Ms. D's policy contained instead an all-cause deductible (which is also known as a "cumulative" or "calendar year" deductible), her incurred covered expenses for any number of occurrences (whether differing or incidences of the same type) would have been accumulated to meet the deductible during a single calendar year. Once enough covered expenses were been paid by the insured to meet the stated deductible, all other covered charges during the remainder of the calendar year would have been paid according to the coinsurance schedule.
Policies that cover entire families usually have a family deductible rather than deductibles that apply to each individual. For example, although a policy's individual-person deductible is, say, $200, the family deductible amount might be $400. Thus, even a family with six members would pay no more than a total of $400 in deductible expenses, as opposed to the $1,200 that would be required if every member had to meet the $200 individual deductible.
The time during which benefits are paid, known as the benefit periods, are generally dependent upon the deductible and any internal limits that may be included in the major medical policy. For instance, when a deductible amount has to be paid, the policy's benefit period could begin either on the first day of the illness (or accident) or on the date that the insured satisfies the full deductible (if this is later than the date of the occurrence), and may extend for up to two years. In other cases, the benefit period ceases at the end of the calendar year and begins anew with a new deductible.
Internal limits are benefit limitations placed on specific coverages within the major medical policy. For example, the policy might limit both the hospital room and board benefit and the number of days that benefits will be paid. In such a case, the benefit period for room and board would be the number of days that have been specified as the limit. Other examples of internal limits might be restrictions placed on convalescent care days, mental health care, the number of X-rays per claim, etc.

Covered expenses
All major medical policies, whether comprehensive or supplemental, provide a wide range of benefits. The precise services covered may vary somewhat from policy to policy, but most major medical plans include coverage for many of the following services and procedures:

• Hospital inpatient room and board including intensive and cardiac care
• Hospital medical and surgical services and supplies
• Physicians' diagnostic, medical, and surgical services
• Other medical practitioners' services
• Nursing services including private duty service outside the hospital
• Anesthesia and anesthesiologist services
• Outpatient services
• Ambulance service to and from a hospital
• X-rays and other diagnostic and laboratory tests
• Radiological and other types of therapy
• Prescription drugs
• Blood and blood plasma
• Oxygen and its administration
• Dental services resulting from injury to natural teeth
• Convalescent nursing home care
• Home health care services
• Initial purchase of prosthetic devices
• Casts, splints, trusses, braces, and crutches
• Rental of durable medical equipment (DME) such as hospital-type beds and wheelchairs.

Types of Major Medical plans

HMO

An HMO, Health Maintenance Organization, is a type of insurance plan that focuses on the long term care of its insured and is normally less expensive than a Major Medical Plan. Each patient has a Primary Care Physician, who is responsible for providing preventive care and coordinating care for the patient if additional specialists or hospitalization is necessary. This keeps costs down. In addition, limiting choices, such as choosing physicians only within a network and not covering services that are deemed unnecessary, controls costs. HMOs are considered “managed health care.”

PPO

A PPO, Preferred Provider Organization, is similar to an HMO as there is a network of physicians, but unlike an HMO in that an insured is not limited to network physicians and can see any doctor they choose. However, co-payments and deductibles will be less for in-network services. In addition, network physicians determine reasonable charges therefore, if an out-of-network physician charges more for services, the insurance company will still pay only 80% of the in-network charges. The insured will often pay higher fees for out-of-network services. Some people prefer the freedom to choose their own doctors and not be limited to a network.

POS

A POS, Point of Service, is considered to be a combination of a PPO and an HMO. The insured chooses a Primary Physician and all health care should start with the patient consulting this physician. This doctor authorizes a referral to a specialist, in or out of the network. (In HMOs, specialists must be within the network for the insured to be covered.) If a patient sees a specialist without a referral, the insurance company may choose not to pay for the services. A POS plan is also considered a managed health care plan, but the insured has more options than in a HMO.

Common major medical insurance terms
Deductibles — allowed charges paid out-of-pocket before carriers pay benefits, ranging from $250 to $5000 per person.

Copayments — a dollar amount paid per visit or service. All plans may use copayments for in-network services when offered as a PPO or POS plan.

Coinsurance — the percentage of allowed charges the carrier pays after the deductible is met, ranging from 60% (Plan B) to 90% (Plan E), until the MOOP is met.

MOOP (maximum out of pocket) — the total amount of allowed charges, ranging from $2000 to $10,000 per person, that must be satisfied before the carrier pays 100% of the allowed charges.
CATASTROPHIC COVERAGE
Catastrophic health insurance carries a high deductible and a low premium. It is designed for patients who are generally healthy and don’t necessarily need to visit their physician regularly.  The plan usually does not cover regular doctor visits (check ups, etc.) but it does provide major hospital and medical expenses coverage.  If you are in good health and simply want to be covered in case of a major illness or accident, then a catastrophic health plan might be the best option for you.
Catastrophic health plans usually cover hospital stays, x-rays, and surgical expenses, but do not normally cover mental health care or maternity care.

Do I Need a Catastrophic Health Insurance Policy?

Most people who purchase catastrophic health insurance are either in their twenties or between the ages of 50 and 65.6
If you are a self-employed young adult, or employed without sufficient benefits, you may want to consider catastrophic health coverage in order to protect yourself against the financial difficulties that can ensue following a major health crisis.
If you are between the ages of 50 and 65, purchasing catastrophic health insurance can be a smart form of financial protection should you develop an illness such as cancer or heart disease. However, if you are beginning to develop health problems and need to see a physician on a regular basis, then catastrophic health coverage may not be for you.

What Will a Catastrophic Health Insurance Policy Cost?

Catastrophic health insurance often offers lower premiums than other, more comprehensive plans.  Should you need hospitalization, your high deductible may end up costing you more than you saved by having lower premiums. If you choose a catastrophic health insurance plan, you should make sure that you have savings set aside to cover your deductible amount in case of emergency.

Are There Other Options Besides Catastrophic Health Insurance?

If you are not sure if a catastrophic health plan is exactly what you are looking for, you may want to consider other high deductible, low premium plans.

LIMITED MEDICAL PLANS

What is a limited medical plan?
A limited medical plan or "Mini-Med" plan is a lower cost alternative to major medical insurance. These plans usually include capped benefits meaning there are specific maximums attached to the benefits. For example, a plan might pay $60 for a doctor's visit and $1000 for a night in the hospital. In capping specific benefits, carriers are able to offer a lower cost plan and little to no rate increase.

Major medical plans vs. Limited medical plans
When comparing a limited medical plan and a major medical plan, there should be no confusion as to which plan you should ideally have; a major medical plan. A limited medical plan is a health plan that provides limited medical benefits up to a fixed dollar amount with a designated number of occurrences allowed.  For example, on doctor’s office consultations, benefit caps the reimbursement to the policyholder amount up to a set dollar figure; let’s say $100.00 per occurrence with a maximum of 4 visits permitted during a policy year.
On the other hand, a major medical includes comprehensive coverage with higher benefits limits. Thus, the carrier and the policyholder cost-share in the expense of the medical bill at a split percentage rate, let’s say, 80/20 or as a copayment amount up to a lifetime maximum. Hence, by limiting the benefit payout in a limited medical the carrier is able to offer lower premiums and utilize lenient underwriting criteria or none at all. In contrast, a comprehensive major medical plan is much more selective in their underwriting evaluation while offering coverage at higher premium amounts. 
As mentioned before, a major medical plan is more selective; therefore, the possibility exists for a carrier to decline your request for coverage during their full underwriting process. The criteria selection varies from one insurance carrier to another and so does the cost of health insurance.
Normally, insurance companies, such as, Aetna, Assurant Goldenrule, Humana, take into consideration certain  levels of risk based on your height to weight proportion, gender, age, credit worthiness, medical history, occupation, hobbies, lifestyle habits, as  determinants for offering or declining coverage.
If you happen to be overweight, some may accept you at a standard premium cost while others will impose a surcharge for what is considered a substandard risk. On the other hand, limited medical health plans reduce or eliminate their underwriting requirements, may or may not use premium surcharges for substandard risk, and are able to accept more members into their health plans.
Limited medical health insurance policies are available as a stand-alone plan with insurance benefits only or with additional value-added features such as savings on prescriptions, dental, vision or chiropractic services, legal consultation, hearing professionals and more.
There are a number of possible choices and finding what you need requires research, luck or locating a licensed insurance professional knowledgeable with limited medical plans benefits.
How do you make a choice?
You may choose to do research on the available limited medical health programs   in the marketplace or seek the guidance from a licensed insurance professional. An insurance agent/broker has the ability to sift through the number of choices available and recommend the appropriate one that best fits your specific needs and budget.
In choosing an insurance professional make sure you are working with someone who has an active license to sell in your state.
Contact your state’s Department of Insurance to assure you are working with an actively licensed agent, or you may do an online search through the division’s portal to check on the agents standing with the department prior to solidifying a business relationship.  

Health Insurance changes for 2011
This year's open enrollment period, when employees choose their health insurance for the following year, will follow a familiar pattern. Higher premiums. More co-payments. Expanded deductibles. But along with the usual cost increases will come some significant changes mandated by the health care reform law. These changes could affect everything from the dependents you cover to the size of your deductible. Here's how the legislation could affect employer-provided health insurance in 2011:

Preventive care
All new insurance plans are required to offer free preventive care. That means they must cover cancer screenings, blood pressure, diabetes and cholesterol tests, flu shots and other preventive services without charging you a co-payment, co-insurance or deductible. (To find a complete list of preventive services that are covered, go to www.healthcare.gov.)
Plan sponsors hope this change will encourage employees to get routine screenings and checkups that could ultimately lower health care costs, says Dean Hatfield, senior vice president for Sibson Consulting. "It eliminates any excuse, financially, to partner with your doctor" on preventive care, he says.
With 100% of preventive care covered, you may decide you can afford to increase your deductible, which usually results in lower premiums. But first, make sure your plan is required to comply with the rule. Insurance plans that were in existence before March 23, when the health care reform bill was signed into law, may be eligible for "grandfather" status, which means they're not required to comply with the requirement, says Randall Abbott, senior consultant for Towers Watson. Employees "can't just automatically assume they're going to have 100% preventive benefits," he says.
Plans that are grandfathered are required to make the information clear in their enrollment materials, Abbott says.
Insurance plans that make significant changes — such as reducing benefits or raising premiums — will lose their grandfather status, Abbott says. An August survey by Towers Watson found that more than half of large plans expected to lose their grandfather status because they increased employee contributions or made other changes in plan terms.

Restrictions on flexible spending accounts
Health care flexible spending accounts let you contribute pretax dollars to pay for unreimbursed medical and dental expenses. These accounts are funded by contributions from your paycheck, and when you enroll in your insurance plan, you must decide how much you want to contribute during the year. The downside to these plans is that most employers require you to forfeit any money that hasn't been used by year's end.
In the past, workers who have funds left over near the end of the year have been able to stock up on aspirin and cough syrup. But starting in 2011, over-the-counter medications won't be covered by flex accounts unless you have a doctor's prescription, according to Hewitt Associates.
If you buy a lot of ibuprofen, this could affect the amount you put aside in your account. But even with the new restrictions, flex accounts can save you a lot of money, says Helen Darling, president of the National Business Group on Health. In addition to prescription drugs, you can use the money for co-payments, deductibles, and dental and eye doctor appointments. Your plan administrator should provide a list of products and services that are covered by your flex plan.
For 2011, there's no federal limit on how much you can save in a flexible spending account, although many employers have their own cutoffs. Starting in 2013, though, accounts will be limited to $2,500.

Expanded coverage for adult children
Health insurers must allow adult children to remain on their parents' employer-provided group plans until age 26. This is the most significant change taking effect this year, Darling says. In the past, many employer-provided plans wouldn't cover a child unless the child was claimed as a dependent on the parent's tax return, and some required that the child live at home, Darling says.
However, that doesn't mean your child will be eligible for coverage immediately. While the provision takes effect Sept. 23, plans aren't required to extend coverage until they start a new plan year, which for most is Jan. 1.
Earlier this year, several large insurers announced that they would extend coverage to adult children ahead of the deadline. However, most large employer-provided plans are waiting until the start of their new plan year, Abbott says.
Coverage isn't automatic: To obtain the extended coverage, you'll need to add your child when you enroll in your plan for next year. If your child becomes eligible after the enrollment period ends, your employer will be required to give you 30 days to enroll.
Married children and financially independent children are eligible for this coverage, but their spouses are not. Also, if your plan has grandfather status, adult children aren't eligible for coverage if they have access to their own employer-provided insurance.