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Catastrophic health insurance

Catastrophic health insurance, also known as high deductible or major medical insurance, is a cost-saving healthcare strategy that is designed to protect you against possible medical costs associated with a critical illness.

Catastrophic health insurance usually covers medical procedures that help diagnose or eliminate a catastrophic illness, as well as X-rays, lab tests, surgery, hospital stays and intensive care. As it always is, there are certain exclusions from this type of insurance. These are some preexisting conditions, medications, doctor visits, prenatal and maternity care.

Catastrophic health insurance normally requires high deductibles and low monthly premiums. The average deductible can vary from $500 to $2,000 and higher. Depending on the fixed deductible this insurance will cover only medical expenses above this deductible. Routine expenses (prescription drugs, doctor visits) are paid entirely out-of-pocket.

Catastrophic health insurance is offered as an individual plan or as a group plan through the employer. It can be of interest to you if the employer does not offer health insurance or you do not want to pay for the coverage you do not need.