DEFINITION of ‘Blanket Medical Expense’
An insurance policy which provides coverage for all medical expenses below an aggregate limit. Blanket medical insurance does not place limits on the type of medical services or procedures that the policyholder undertakes.
BREAKING DOWN ‘Blanket Medical Expense’
Insurance companies often create restrictions on the types of procedures, tests, and services that are covered by a policy. This helps put downward pressure on costs by removing the pay-for-service incentive for the medical professional. Insurance companies may, for example, link financial incentives for doctors to improve the long-term health of the patients covered by the policy.
Individuals have a number of options when it comes to the level of health insurance coverage that they choose. In some cases, limits are placed on the types of procedures that will be covered by the policy. Individuals looking for broad coverage of medical expenses can consider a blanket medical insurance policy
Determining whether a blanket medical insurance policy is a good fit requires the individual to have an understanding of the medical risks that he or she may face in the coming years. This type of policy centralizes all of the medical expense coverage, and may reduce the need for the purchase of more specialized policies to cover specific risks. However, the policy still has a limit on the aggregate coverage it will provide across all types of medical expenses, meaning that medical expenses in excess of the limit will be the responsibility of the insured party.
Blanket medical insurance is likely to be more expensive than standard health insurance policies because it allows the policyholder to pursue any number of expensive medical treatments, which opens up the insurer to the possibility of more claims than with a traditional health insurance policy. The amount of coverage offered by the blanket policy may exceed that offered by a single health insurance policy, meaning that it may be the equivalent of one or more standard policies.