What To Know About A Health Insurance Policy Maximum LimitMonday, November 1st, 2010 by admin
Shopping for a health insurance policy can be overwhelming. Policies vary widely in both cost and coverage options. When you are looking for the best policy at the best price to meet your needs, it can be hard to know where to begin. A good place to start is with an element common to almost all health insurance policies, the maximum dollar limit.
A maximum dollar limit can come in the form of an annual limit or a lifetime limit. Specifically, it refers to the total dollar amount that an insurance policy will pay for treatment during either a year or across the policy's life.
Annual maximum dollar limits are the most common type of benefit limit. With a policy that has an annual limit, every cost paid by the insurance company, for example, drug costs, hospitalization, surgery and doctor visits, add up until the annual limit is reached. Once the cost of care paid by the insurance company reaches the predefined limit, the insurer will not pay any more until the next fiscal year begins. What if the annual maximum dollar limit is not reached during a fiscal year? Most health insurance policies allow at least a fraction of a year's unused limit to be rolled over into the next year.
Similar to a health insurance policy with an annual limit, some policies include lifetime maximum dollar limits. This type of limit can be instead of, or in addition to, annual limits. This type of maximum dollar limit can be especially troublesome for individuals who become ill with chronic or terminal illnesses that can require expensive care over the course of years. If a person becomes ill and hits the maximum lifetime dollar limit, they may not be able to obtain alternative health coverage.
Some insurance companies offer policies that do not count preventative care, doctor visits or prescription medications toward the maximum dollar limit. There are even no-limit policies available on the market. However, these policies are rare, and the premiums for them can be cost prohibitive to most consumers. For most consumers, the right policy will have some form of maximum dollar limits. The best approach then becomes to choose a policy with a high enough limit to cover expected care and manage costs across the year. This can be done by choosing a policy with a higher deductible or abstain from submitting certain costs to the insurer to pay.
When shopping for the right insurance policy, it is important to understand the maximum dollar limits of each policy you are considering. You should be sure to research all health insurance policy provisions and talk to an agent before committing to any policy.