Breaking Down Full-Coverage Health Insurance

When it comes to attracting and retaining employees with various employee benefits, health insurance is at the top of their minds. A survey shows that “56% of U.S. adults with employer-sponsored health benefits said that whether or not they like their health coverage is a key factor in deciding to stay at their current job.” The same survey shows that “46% said health insurance was either the deciding factor or a positive influence in choosing their current job.”

With health insurance, the type of coverage is important. You may have heard the terms full-coverage health insurance or comprehensive coverage. Learn more about what this type of health insurance is, and why you should consider offering it to your employees.

What is full-coverage health insurance?  

Full-coverage health insurance, also known as major medical health insurance or comprehensive coverage, is a health insurance plan that provides overarching, broad coverage of a variety of healthcare services such as doctor visits, hospital visits, and emergency room visits.

In contrast to full coverage, limited-benefit plans (or supplemental policies) may cover only specific conditions (e.g., cancer) or specific types of services (e.g., hospitalization), or have a dollar cap on coverage. These plans are not considered comprehensive, nor are they considered minimum essential coverage, and are not regulated by the Affordable Care Act. However, they can be a good supplement to a full-coverage health insurance plan.

What should be included in a full-coverage health insurance plan?

At the minimum, a full-coverage health insurance policy, which includes all new individual/family and small-group major medical health insurance policies sold after January 1, 2014, must cover the ten essential health benefits outlined in the Affordable Care Act (ACA) with no annual or lifetime benefit caps:

  • Hospitalization
  • Ambulatory services (visits to doctors and other healthcare professionals and outpatient hospital care)
  • Emergency services
  • Maternity and newborn care
  • Mental health and substance abuse treatment
  • Prescription drugs
  • Lab tests
  • Chronic disease management, “well” services, and preventive services
  • Pediatric dental and vision care
  • Rehabilitative and “habilitative” services

What is considered a full-coverage health insurance plan?

  • Most group health insurance plans
  • ACA-compliant policies purchased in a state’s health insurance exchange/marketplace
  • ACA-compliant plans purchased off-exchange (purchased directly from an insurance company or through an agent or broker, outside of the ACA-created health insurance exchange)
  • Medicaid and Child’s Health Insurance Program (CHIP) plans (Medicaid has some exceptions. Some people qualify for limited-benefit Medicaid coverage; this is not considered comprehensive coverage.)
  • Medicare (either Original Medicare or Medicare Advantage, although Original Medicare is typically combined with a Medigap plan and Part D plan to provide comprehensive coverage)

Be aware that the term “comprehensive” regarding health insurance plans is like the term “natural” regarding groceries. It’s not an officially defined term and has no official marketing rules associated with its use.

A variety of full-coverage plans

Employers can offer different types of full-coverage plans to cover specific needs. Here are some examples, as given by the official government healthcare website:

  • Exclusive Provider Organization (EPO):  A managed care plan where services are covered only if you use doctors, specialists, or hospitals in the plan’s network.
  • Health Maintenance Organization (HMO): Usually limits coverage to care from doctors who work for or contract with the HMO, and it generally won’t cover out-of-network care except in an emergency. An HMO may require you to live or work in its service area to be eligible for coverage.
  • Point of Service (POS):  A health plan where you pay less if you use doctors, hospitals, and other health care providers that belong to the plan’s network. POS plans require you to get a referral from your primary care doctor to see a specialist.
  • Preferred Provider Organization (PPO):  A type of health plan where you pay less if you use providers in the plan’s network. You can use doctors, hospitals, and providers outside of the network without a referral for an additional cost.

Be well-informed and do your research

Buying health insurance means you should always do your research. It’s important to work with your advisor and legal counsel to help you understand the fine print and terminology (such as essential health benefits and minimum essential coverage) before offering plans to your employees. Full-coverage health insurance is what employees want from their employers, and implementing such a plan will lead to employee attraction, retention, and satisfaction.


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Photo by yavdat1