How is this possible? The main drivers of health insurance premiums are the benefits but even more specifically, the deductible. The lower the deductible, the higher those health insurance premiums rise. If designed correctly, utilizing the combination of a major medical plan with the correct gap plan, can lower your deductible to essentially $0! Think, platinum benefits at bronze prices
So how does Gap work?
Most Gap plans offer an inpatient benefit and an outpatient benefit. For example, you could have a Gap plan that covers $5,000 for inpatient hospital stay and $2,500 for outpatient benefits per calendar year. With this Gap plan if you had a $5,000 out of pocket maximum, you essentially just lowered your deductible to $0! The Gap plan will only cover whatever the major medical covers. They will follow your major medical’s benefit summary. Gap plans offer riders that can be added onto the basic plan, such as coverage for lab work and coverage for durable medical equipment.
Less money out of pocket
Spreading the risk between two carriers.
GAP covers a portion or all of these costs.
Major medical deductible:
Inpatient Benefits: $3,000
Outpatient Benefits: $1,500
John isn’t feeling well and
has to go to urgent care.
Major medical co-pay: $150
Gap outpatient benefits: $1,500
Remaining GAP Outpatient Benefits:$1,350
John pays: $0
John still isn’t feeling well and
is hospitalized overnight.
Major medical hospitalization benefits: $3,000 deductible GAP Outpatient benefits: $3,000 John pays: $0
Jane’s insurance says her Out of Pocket Maximum is $5,000.
So Jane would pay $3,000 in deductible and $2,000 in co-insurance and now for the rest of the year, Jane’s medical coverage is 100% covered.
Insurance company pays: $65,000
It’s like having…
Two different gift cards