As health care policy goes, this is not a widespread issue. The number of people who incur medical costs over $1 million or $2 million is quite small and most health insurance coverage is at much higher levels.
But with health care costs doubling since 2000, a few health insurers have increased prices but they have not necessarily increased their standard lifetime caps. That means more and more people with catastrophic costs find themselves under-insured.
Ironically, providing insurance for the big health care claims is often the easiest part of the health insurance business:
- Catastrophic coverage is pure insurance--not just first dollar reimbursement.
- Catastrophic reinsurance is readily available to health plans at a reasonable cost.
- The industry does a very good job of managing the large and complex high cost claims.
That goes for employer sponsors and individuals as well as insurers.
I would recommend a cap of no less than $5 million.