The Five Types of Health Insurance

If you’re admitted to the hospital, this policy pays for room and board, laboratory expenses, nursing services, drugs and supplies. It covers inpatient care – meaning care you receive while admitted, not outpatient visits or doctor’s office calls.

This type of coverage pays for the services of surgeons and anesthesiologists. It picks up the professional fees associated with surgical procedures, which hospital insurance alone may not fully address.

This policy pays for visits to doctors’ offices and related outpatient fees. Think of it as coverage for the everyday medical care that happens outside of a hospital setting.

This type of policy is designed for the large, unexpected medical bills – often up to $1 million. The catch is that you first pay a deductible before the insurer steps in. Even after the deductible is met, these policies typically require you to cover 20% to 30% of the remaining bill, up to a certain amount.

For example, a major medical policy might carry a $2,000 deductible and an 80/20 co-insurance clause up to $10,000. That means you pay the first $2,000 of any bill, plus 20% of the next $8,000. After that, the insurance company covers all remaining eligible charges.

These policies combine the features of all four types above into a single plan. They typically carry much lower deductibles – $200 instead of $2,000, for example – which makes them more convenient to use. That convenience comes at a cost: comprehensive policies are generally more expensive than the others.