What Health Insurance Covers and Doesn’t Cover

Along with basic coverage, major medical coverage is necessary in case of a catastrophic accident, or illness. Pixelbliss/Shutterstock

Most people don’t like to discuss health insurance. It’s needed, but often not closely looked at. Comparing coverages when the enrollment window is open is important, but too often comparisons are vague.

Even when the window is closed, you should dig deep to find out everything your insurance offers and doesn’t offer you. Although individual policies and companies are different coverages, here are some basic coverages that will guide you when planning your health care needs.

Standard Health Insurance Plans Have 2 Types of Coverage

Basic coverage is one of the two coverages offered. It includes hospital, surgical, and physician expense coverage.

Along with basic coverage, major medical coverage is necessary in case of a catastrophic accident or illness. And although basic insurance and major medical insurance can be purchased separately, it’s less expensive if you buy them together.

Here are some of the coverages for basic and major medical:

• Preventative visits: annual check-up is typically covered 100 percent
• Vaccinations: covered 100 percent
• Non-preventative doctors’ visits
• Hospitalizations
• Emergency rooms
• Lab work
• Additional or supplemental coverage

All these coverages either have co-pays and coinsurance requirements or are subject to deductibles.

Basic coverage with major medical comes with a deductible. In 2024, employer-provided coverage’s average deductible for an individual was $1,787, according to the latest KFF annual survey.

This is the average and depends on the employer plan offered. An individual policy may also have a higher deductible.

Catastrophic Health Insurance Plans

Because of the premium price, not everyone purchases standard health insurance.

Catastrophic plans have the lowest premiums, but come with the highest cost-sharing with the insurance company. In other words, they have a high deductible.

In 2025, the average annual deductible is $9,200 for an individual. If you have a catastrophic policy, you will pay the entire cost of covered services up to that amount. After you hit $9,200, the plan pays 100 percent of covered in-network services for the rest of the year.

So, other than preventive care and three primary care visits per year, you are responsible for all your health care costs until the deductible is met.

The deductible amount resets each year.

Catastrophic health plans are not for everyone. They are for a specific demographic.

For example, some individuals, like those of Gen Z or younger millennials, may purchase catastrophic insurance. The theory is that they are healthier than their senior counterparts and don’t need the basic plan. It also saves them money.

There is an age limit on purchasing catastrophic insurance. These plans are only available for adults up to age 30. They are also available for older individuals who can’t find a Marketplace policy that costs less than 7.28 percent of their income. Adults who have experienced significant life events that impact their ability to purchase standard health insurance may also qualify for catastrophic health insurance.

Catastrophic health plans aren’t eligible for health savings accounts (HSAs).

What Doesn’t Health Insurance Cover

Excluded services on a health insurance plan may differ according to an individual company. States have regulations concerning coverage exclusions that are unique to them. However, overall, some coverages are excluded from a health insurance policy.

Some procedures are seldom covered.

For example, cosmetic procedures like vein removal or plastic surgery are nearly always considered elective and, therefore, not covered.

Fertility treatments are covered in specific states, but are not generally covered. New medical devices are typically not covered, and some prescription medications that are prescribed off-label may be excluded.

What Determines Excluded Services and Devices

Typically, health insurance companies use Medicare as a guide for what will and will not be covered. Unfortunately, Medicare tends to be conservative in adopting new drugs, procedures, and devices.

This means cutting-edge technology is often deemed too expensive or experimental for coverage.

Are Pre-Existing Conditions Covered?

According to the U.S. Department of Health and Human Services, and in accordance with the Affordable Care Act (ACA), health insurance companies cannot refuse coverage or charge you more because you have a pre-existing condition.

A pre-existing condition is a health problem you have prior to the date the new health insurance coverage begins.

Some pre-existing conditions may include diabetes, pregnancy, asthma, cancer, among others.

The insurance company also cannot limit benefits for these conditions.

Non-traditional health plans, however, may not be subject to ACA regulations. These companies may not cover pre-existing conditions. These include travel insurance, short-term health insurance, and fixed indemnity plans that have set payouts for specific conditions, such as cancer insurance.

Medigap plans aren’t standalone health insurance plans because they supplement Medicare and can’t exclude pre-existing conditions if you sign up during the Medigap open enrollment period. However, they can impose waiting periods.

But if you sign up after the six-month open enrollment period, Medigap can use your medical history as a basis for pricing and eligibility. The exception is if you meet certain conditions or live in a state with annual Medigap enrollment.

Summary of Benefits and Coverage

Request a summary of benefits and coverage (SBC) from your insurance company. It’s a standard document that all plans are required to provide. It will list all the services your plan covers.

You’ll also want to look at your plan’s drug list, so you know which medicines are covered.

The Epoch Times copyright © 2025. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.