Escalating medical costs these days mean that we are progressively moving away from traditional types of medical insurance and the original fee-for-service medical insurance plan is rapidly being replaced by a number of other plans including HMO (health maintenance organization) plans, PPO (preferred provider organization) plans and POS (point of service) plans.

Basically fee-for-service medical insurance plans are designed to cover unforeseen medical expenses due to illness or injury and give plan holders significant freedom in picking where treatment is taken and by whom such treatment is given. Fee-for-service plan holders are also usually responsible for paying for treatment and for then reclaiming the cost from their insurer.

Newer plans by contrast focus much more on routine medical care with the intention of avoiding unnecessary costs by keeping plan holders well and identifying problems at a very early stage when they are hopefully simple to treat. These newer plans simplify administration for plan holders but also take away much of the freedom to decide where and from whom treatment is to be received.

Most people today are covered by the newer types of medical insurance instead of by traditional fee-for-service plans primarily not only because of their reduced cost but also because there is a lot less administration when it comes to making claims against your plan. In addition, a rising number of employers who offer group health insurance plans for their employees are also opting for these newer types of plan. All the same, there is still a large number of people who want the freedom of choice which a fee-for-service plan gives them and it is here that you may want to look at major medical insurance coverage.

Fee-for-service plans provide three forms of coverage; basic health insurance, major medical insurance and comprehensive insurance.

Basic health insurance plans vary from one insurer to the next but will usually cover hospital treatment (plus the cost of room and board), some hospital services (like x-rays and medicine), surgery (whether done in hospital or another recognized surgery center) and some doctors visits.

By contrast major medical insurance plans are designed to cover the treatment of long-term and high cost illnesses and injuries and both in and out-patient expenses associated with such illnesses and injuries.

Finally, comprehensive insurance cover is merely a plan which encompasses both basic and major medical coverage.

Perhaps not surprisingly major medical insurance is a popular choice as many people are only too happy to pay the day to day cost of medical care but are worried about how they would cope in the event of a major illness or accident which might involve large medical expense which could drag on for weeks, months or even years.

Sadly, the security and choice that is provided by major medical insurance is reflected in the cost of fee-for-service plans generally and thus it is increasingly becoming an option which a lot of people would like to select but one which is simple becoming too expensive.

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COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that allows workers who have lost their jobs to continue their employer’s group health coverage for 18 months as long as they pay the full amount of the premiums plus a small administrative fee. Dependents such as your spouse (even if you are divorced) and your children are also eligible under COBRA even if you personally elect not to avail of these benefits; they can be covered for as long as 36 months. However, COBRA is not cheap; premiums alone can eat up over 80% of average nationwide monthly unemployment benefits. Employers, however, may give you the option of dropping certain benefits under COBRA to reduce premiums. And you can cancel COBRA coverage at any time; you don’t have to use up your full eligibility period.

A second alternative is catastrophic health insurance, which is also called a major medical health plan. While major medical health plans have low monthly premiums, they also have high deductibles (the share of the health bill the insured is required to pay). The policy usually pays only for major medical and hospitalization expenses (such as surgery, lab tests and diagnostic X-rays) above the deductible, while you pay out-of-pocket for preventive health care (such as routine check-ups) and prescription medicines; however, this type of plan may be sold in combination with a comprehensive plan that includes coverage for preventive care. This type of short-term insurance also has a lifetime-benefits cap; once your medical expenses reach that cap, the insurance company will not cover any further expenses and will terminate your policy.

The most affordable type of short-term medical insurance is limited-term health insurance. This type of insurance offers coverage for as short as 30 days and as long as a year, although it is renewable for as long as three years. Premiums are low and the application process is easy; you can get coverage the day after your application is approved. Depending on the type of policy you take out, you can enjoy as much as $5 million in individual coverage benefits. You can also see any health provider that you want.

However, limited-term insurance does not cover pre-existing conditions or health problems that you were already diagnosed with prior to your applying for the policy. Also, it usually does not cover the cost of preventive health care, only major health care expenses such as emergency room services, surgery, and hospitalization. You can also get coverage for your spouse and dependent children under a limited-term plan. This type of health care policy is probably the most affordable alternative for you to get coverage until you can find employment that will provide you with health insurance.

Why do people travel abroad for medical tourism? Cost is the big reason. Today, forty-seven million Americans are uninsured.  The cost of treatment for medical or surgical procedures in the U.S. is often prohibitive and far beyond the average person’s ability to pay for it.  Many people who need help put off seeking it because they simply cannot afford it.  Many surgical procedures (i.e. heart bypass, joint replacement, spinal disc repair, Lasik eye surgery, Lapband weight reduction surgery) cost 50% to 90% less abroad. Those huge savings can make the cost of even major medical care affordable for anyone forced to pay out of pocket for treatment.  Medical tourism companies like Medbirds (www.medbirds.com) are helping patients find affordable, high quality surgeons and facilities abroad. Medbirds is a U.S.-based medical tourism facilitator founded by a seasoned group of U.S. health care professionals and has expanded rapidly to become a major player in the global health care market.  The company connects patients to 5-star medical facilities in Thailand and India.  These two countries are clearly the strongest choices in terms of price, capability and quality.   

Even when a medical tourist factors in the cost of airfare for himself and his companion (accommodations, meals, other travel-related expenses, and the cost of the procedure itself), the cost savings are striking.  In most cases, even when patients fly halfway around the world and stay at top hotels, they are still saving huge sums of money as compared to having received care in North America.  For more information on Medical Tourism, see:  WSOC-TV July 2009,  9 Investigates: Patients Going Outside U.S. for Cheaper Medical Treatments.