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Limited Medical Insurance

Healthcare cost is on the rise in US economy and it requires special effort from Government and concerning authority to curb it down without affecting the well being of citizens. The number of people deprived of health insurance is also increasing with every passing day. Around 50.7 million people are uninsured as of 2010 which are roughly around 16.7 percent of the total U.S. population. People are on the lookout for guaranteed affordable coverage. In fact, the major source of Insurance Coverage for Americans comes from Employer sponsored insurance. Some of the other sources of coverage are as follows:

Recent analysis shows two major reasons for rising uninsured population. They are:

  • Majority of US population works in small companies who cannot afford to provide quality health insurance policies to its employees. Thus, lack of access to employer sponsored health benefits leads to rise in uninsured population.
  • The other factor is high premium rate for insurance policies which majorities cannot afford because of over dependence on employer sponsored insurance program.

We cannot deny the importance health Insurance for development of any country and US is no exception because, at the end of the day, it’s the work force which takes a country towards growth and development. Some of the importance of Health insurance in terms of Health and Financial consequences is as follows:

  • Women without proper health insurance are more likely to suffer in times of pregnancy and delivery situation.
  • Poor health and premature deaths is also common among uninsured adults.
  • Children suffer from lack medical care.

In the wake of this rising Healthcare cost and huge uninsured population, Government administration and companies are looking at new ways to reduce the burden of people. Limited Medical Insurance (LMI) is perceived as one such way of helping the population. This new market segment has a potential of around 15% annual growth rate.

LMI have been in existence for over 2 decades but it has gained popularity significantly in the last few years. It is considered as the fastest growing sub-sector in insurance market today. Every year, we see new companies and LMI plans entering the market. As of today, more than 30 US LMI carriers offer different Limited Medical plans.With LMI offering companies rated from A+ to C, the market has become quite competitive.The companies offering most distinct products along with other facilities stand a better chance of survival. LMI is mostly accepted by employer who employs part-time and hourly employees.

What is LMI?

LMI are type of health insurance policies which targets uninsured workers working in small/mid level organization on an hourly or part-time basis. It gives an employer the opportunity to choose the benefits they want to offer at a price they can afford to itsemployees. It is an alternative to those people who cannot afford the cost of a general health insurance and can provide specific preventative health care coverage to individuals and groups. Some of the benefits which LMI can cover are asfollows:

Government’s take on LMI:

USA is in serious Healthcare crisis that is been continuing for quite some time now. The challenge of providing proper medical assistance to its citizen is a top priority for Obama’s administration. With ever increasing Healthcare cost, it will not be surprising if a point is reached where people cannot afford medical expenses. These factors lead to the emergence of LMI. It appeared to be a good way to offer previously uninsured people with some financial protection for a portion of their health care cost.

In recent times, it has been observed that there has been some kind of protest from various angles for allowing the operationof LMI without strict regulatory framework. Obama’s Administration is highly criticized as some think LMI is good for nothing. It is misleading people with false promises and end up not covering medical expenses. But the reality lies in understanding the terms of plan. Proper caution is the ultimate requirement in generating the benefits out of LMI. Furthermore, workers compensation loss ratio shows significant improvement after implementation of LMI because uninsured employers have started using workers compensation as an alternative medical plan.

Recently, the Obama Government promised that more comprehensive plans would be available through state exchanges by 2014, when all plans will have to comply with the law and regulatory framework.

LMI Enrollments:

Enrolling and enrollment is the most important aspect of any insurance policyand LMI is no different. The significance of enrollment is immense and it either makes or breaks the group case i.e. it determines successful LMI program or not. Enrollment helps in knowing the exact details about LMI program. It guides the enrollee with the plan benefits, positives, negatives, plan exclusions, limitations, insurance limits, medical networks and how to maximize the benefits of the LMI.

LMI Enrollments:

Enrolling and enrollment is the most important aspect of any insurance policyand LMI is no different. The significance of enrollment is immense and it either makes or breaks the group case i.e. it determines successful LMI program or not. Enrollment helps in knowing the exact details about LMI program. It guides the enrollee with the plan benefits, positives, negatives, plan exclusions, limitations, insurance limits, medical networks and how to maximize the benefits of the LMI.

Outsourcing of LMI:

Outsourcing of LMI has not gained so much popularity as compared to other sub sectors of Insurance industry. The market still appears untapped and there seems to be enough opportunity for outsourcing services in LMI business. A number of big players have already started with LMI in their portfolio of services but opportunity prevails for smaller players as well. A www.healthtechnogy.comnumber of Fortune 1000 companies face a typical problem of providing health insurance for its employees which is solved by outsourcing thus providing some medical benefits without adding a big expense to the company. Outsourcing LMI helps the company to focus on its core competency and all outsourced work like customer service, enrollment, etc is taken care by the vendor company.

Thus, outsourcing LMI can be a tremendous asset for companies by giving the HR team, an extra competitive advantage especially in recruiting. Some of the big names like McDonalds, Marathon Oil and Brunswick have followed this path, thus giving an indication that LMI is hereto stay for long.

Future of LMI:

LMIis expected to grow in the near future specially for companies which have hourly or part time workers. A lot of companies have already taken this route of LMI in order to cut down on expenses. In changing environment with competition becoming tougher, LMI carriers are modifying their offerings in an attempt to model major medical products and coverages.

Current Employers who are offering an HDHP to its employees might well be interested in a LMI because it gives members the ability to defray those out-of-pocket costs covered while they grow the available fund balance inside their health savings account toward payment of the deductible of their HDHP. There are also some employers who have given up on insurance because of cost, complication may also start thinking of implementing LMI as they are flexible and affordable.

But, at the end of the day, it all depends on individual preferences as there are majorities who still vouch for general health insurance plans which covers for a wide range of conditions.

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