Surgical Expense Benefits fall under two plans, scheduled and non-scheduled.  

In the scheduled plan, surgical expense policies pay the fees incurred from the surgeons services and related costs incurred when the insured has an operation.  Typical related costs include fees for an assistant surgeon, anesthesiologist and can even include the operating room when it is not covered as a miscellaneous item.

Basic surgical coverage can be included in the same policy as basic hospital and medical expense and are normally included in a schedule listing major commonly performed operations and the benefits payable for each.  

This gets a bit tricky and you need to be aware of how the insurance company determines the benefit.  Just because a specific surgery is not listed in the schedule does not necessarily mean that there is no benefit for it available. It might mean that the insurer indemnifies that surgery based on absolute value and the relative value of each procedure.
In other words, let’s say that the insurer determines that a certain surgical procedure has a prevailing value of $1500 and indicates that in the schedule included in your policy. That is considered the absolute value. Now, let’s say that there is another procedure not listed in the schedule that is say 50% less complicated as the $1500 procedure.  In this case, the relative value would be $750 and that is the benefit amount that will be paid for the less complicated procedure.

Using a non-scheduled scenario, when surgical benefits are not listed by a specific dollar amount in a schedule, the policy will pay based on what is considered usual, customary and reasonable in a certain geographical area and is also known as UCR.
This non-scheduled type of indemnity is found most often in major medical and comprehensive policies which we will discuss further along.

As you might imagine, under this type of arrangement the UCR is determined by the amount that physicians in the local area usually charge for the same procedure.  
Regular medical expense benefit is another category that is sometimes known as physician’s non-surgical expense.  This coverage is for non-surgical services a physician provides and can sometimes be narrowly applied to physician visits while the patient is in the hospital.  

If this is the case the benefit will most likely pay for a specified maximum number of visits per day, a specified maximum dollar amount per visit and a specified number of days coverage applies.

In other policies this benefit could be for non-surgical services performed by a physician whether the patient is in or out of the hospital. Once again there are limits such as $100 per visit up to 50 visits per year depending on the policy.

Other medical expense benefits fall into a category in addition to the hospital, surgical and medical benefits previously discussed. These optional benefits vary from insurer to insurer and may or may not include as part of their standard policies. Separate policies can sometimes be written to include these benefits.  Some of them are:

§    Maternity

§    Convalescent – Nursing home

§    Emergency first-aid

§    Home health care

§    Mental infirmity

§    Hospice care

§    Dread disease

§    Outpatient treatment

§    Dental

§    Private duty nursing

§    Vision

We will not cover all of these options, but will let’s take a look at the most common.
Maternity benefits are sometimes included in policies subject to certain conditions and limitations.  The most usual limitation is a 10 month waiting period designed to prevent the purchase of health insurance just to cover pregnancy and childbirth expenses. Interesting to note, however, group policies for employee groups of 15 or more are required by law to provide maternity benefits on the same basis as non-maternity benefits.  This means that in a case such as this, the waiting period would not apply unless non-maternity benefits also required a 10 month waiting period.

Aside from the group scenario above, many policies just exclude maternity benefits totally but make them available at extra cost. Where maternity benefits do apply, the benefit usually includes newborn care while the mother is in the hospital.  

Other benefits that are sometimes available under the same maternity coverage might include cesarean deliveries, natural abortions and elective abortions.

Emergency First Aid Coverage applies to an accident that may call for immediate first-aid on the scene. This applies when a medical professional who just happens on the scene provides first-aid service he/she might bill the insured.  Sometimes treatment like this must be performed without the knowledge or assent of the insured. Some policies offer coverage for such contingencies and normally must incur within a very short time after an accident.

Mental Infirmity historically has been excluded from most policies. However, in recent years more and more policies include this type of coverage but with limitations. The benefits are usually much lower than physical ailments and a stated percentage of the benefit paid for other types of medical care is included.  

Common exclusions and limitations.  Both disability income and medical expense policies limit or exclude coverage for certain types of injuries or illness. There is a difference between limitations and exclusions. The mental infirmity policy limitations we discussed above is an example, whereas an exclusion is completely omitted from any coverage.
It is important that you deal with a knowledgeable agent because state laws and policies may differ on specific items.  Some items that fall into the common exclusions and limitations might be:

§    Pre-existing conditions as defined by your policy and dictated by state law.

§    Hernia however the growing trend is to cover the condition.

§    Self-inflicted injuries

§    Suicide

§    War and/or acts of ware that result in injury or death

§    Military duty

§    Non-commercial air travel

§    Injury while committing a felony

§    Injury, illness or death incurred while under the influence of alcohol or narcotics

§    Cosmetic surgery unless for surgery required as a result of an accidental injury or a congenital defect

§    Dental expense, unless resulting from accidental injury

§    Vision correction such as eye exams, eyeglasses and contact lenses

§    Care provided by governmental facility which is normally covered by the Veterans Administration or by workers compensation

§    Sexually transmitted diseases

§    Experimental procedures

§    Organ transplant

§    Infertility treatment and services

§    Alcohol and drug abuse treatment