Group Major Medical

What Does Major Medical Cover?

Major Medical Insurance is considered health insurance by most Americans. But what exactly does major medical insurance cover?

Major Medical Health Insurance has 3 important terms to understand:

1) Deductible

2) Co-Insurance

3) Annual Maximum Out of Pocket.


The deductible is the portion a policyholder must pay before their health insurance plan will kick in and begin to start paying for any of the bills. The deductible is billed at 100%.

So for example, if you have a policy with a $3,000 deductible and you have some sort of health emergency and get billed $6,000 by the hospital.. (Assuming it’s in your network), you will be billed $3,000 and insurance will help pay for the next $3,000.

Next, Coinsurance kicks in.

Coinsurance Levels

Bronze: 60/40

Silver: 70/30

Gold: 80/20

Platinum: 90/10

Let’s assume your plan is a gold plan with a coinsurance of 80/20, meaning, your health insurance pays 80% and you pay 20% of the bills.

In this scenario, you would pay an additional $600 of the remaining $3,000 and insurance will cover $2,400. This leads to the last important term, that is, the Annual Maximum Out of Pocket.

Annual Maximum Out of Pocket

This is the maximum amount of money you will be billed for in a given year. In this scenario you have paid $3,600 for the year and let’s assume your maximum out of pocket is $5,000. You could potentially be billed an additional $1,400 in that given year should you need to use your health insurance again.

As we can clearly see, there are holes in the coverage, and paying $5,000 in a year for expenses, not including monthly premiums or dental and vision expenses can be very stressful on employees and individual policy holders.

This is where we turn to voluntary programs that can cover the gaps in our coverage.

If you have questions about the coverage you are currently offering your employees and/or would like a consultation with someone from our staff, please fill out the form on this page or any of the pages for employee benefits.