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How do limited benefit plans lead to extreme medical bills?

Limited Benefit Plans offer significantly lower levels of coverage than comprehensive health benefit plans. Depending on the state you live in, common medical services may not be covered by your plan, leaving you with a denied insurance claim and high hospital bills.

Understand how limited benefit plans work.

Limited benefit plans offer consumers lower premiums than comprehensive health benefit plans. To do so, they typically involve the following restrictions to your health coverage:

  • Annual dollar caps on total coverage
  • Care-specific coverage caps
  • Excluded types of care

The best way to understand these restrictions is by requesting an Explanation of Benefits from your insurance provider, as every organization and policy is different.

Some limited benefit plans are associated with faith-based organizations and communities. These faith-based limited benefit plans may restrict coverage based on a faith-based moral judgment of specific types of healthcare or causes of care. Healthcare services that may not be covered by a faith-based health insurance plan include but are not limited to:

  • Weight loss treatment
  • Fertility treatment
  • Abortion
  • Addiction treatment
  • Treatment due to accidents or conditions caused by behavior judged to be immoral

How to handle bills due to limited benefit plans.

Depending on the state, you may have little to no legal recourse if you are left with high medical bills due to a limited benefit plan claim denial. Faith-based health plans in particular are frequently exempt from regulation. The Commonwealth Fund made a great report on ministries providing these benefits.

If you have a limited benefit health plan, the most realistic path to resolving your high medical bills is likely a direct negotiation with the hospital.

  • Understand and gather the required documents
  • Determine your strategy
  • Negotiate
  • Get help

Learn more