Mini-Meds –A tough choice to have to make

The Wall St. Journal describes ‘mini-medical’ plans that pay for routine care but offer little or no coverage for expensive treatments. It’s the opposite of what we normally think of (in the regular, non-medical world) as insurance, which covers catastrophic losses after the insured party pays a deductible. Most health insurance policies today combine coverage of routine expenses with coverage of catastrophic events. Consumer directed plans are almost the opposite of mini-meds; they generally hold consumers responsible for managing routine expenses –although there are exclusions for preventive care.

Mini-medical plans are an unpleasant concept. They reflect the fact that many companies and employees can’t afford traditional plans or consumer directed plans. I wouldn’t want to have this kind of plan, and I do think that some of their purveyors are misleading policy holders into thinking they’re getting more than they are. But the plans do serve a purpose for some people. For example:

Some consumers, such as Donald Lee, of Carson, Calif., say they have few alternatives. “My main concern was just getting into some kind of plan for now,” says Mr. Lee, 57. In the fall, the premium on the Lee family’s major-medical plan shot up to $2,500, and because of his and his wife’s diabetes, few other insurers would accept them. So Mr. Lee found a truck-driving job that gave him the option to buy a limited-benefit plan from OptiMed Health Plans, of Boca Raton, Fla. For a $240 monthly premium, the plan reimburses the Lees $60 for each doctor visit and $500 for each day in the hospital. Eventually, he says, he wants to buy a supplementary catastrophic plan, but this one “helps me keep my diabetes under control.”

January 17, 2006

3 thoughts on “Mini-Meds –A tough choice to have to make”

  1. I share your concern over the mini-meds, but at the same time they DO serve a purpose.

    Many of the plans pay a benefit directly to the insured. A good number of insureds lack disability coverage, so any “excess” over the actual cost of services helps to keep the lights on at home.

    Also without this kind of policy, many will either avoid going to the doc altogether, or postpone going until there is a real medical crisis.

    I have employer clients who want to offer something that will be appreciated, and will help retain/attract good employees. They can’t afford the traditional major med, so this is a start in the right direction. Many times the employer pays for the mini-med and gives the employee the option to “buy up” with a wrap around major med on a payroll deduction basis.

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