Summary
MiniMed aka Limited Medical aka Scheduled Medical Benefits are not new. They derive from the disease specific plans of old. The article suggests that the uninsured have been ignored which is incorrect. Many major players have rushed this market niche to find out the premiums are low and the turn over is high - making the marketing costs a poor value and an expensive mistake in money, and especially fragmented focus. However, there are some winning plans that appeal to both the 47,000,000 uninsured (some estimate at over 80,000,000), AND to insured people with high deductible health plans aka CDHP's, HSA & HDHP's. The well-heeled individual market is a wholly different game, and is aggressively being sought by most carriers looking to underwrite Major Medical risk. But that is Major Medical expensive insurance and not Scheduled Medical Benefit plans. The most likely governmental action is to subsodize this niche, so getting in front of the ball presents opportunity.
Analysis
We found an A+ rated Scheduled Medical product that was better priced than what we could muster on our own. As a rule, most supposed scheduled medical plans are complex, and defeat their purpose, and more importantly budget. That translates into poor sales.
After many hours of studying and creating a best of breed "Scheduled Medical Plans" several common denominators emerge. These plans cost $40 - $175/m, not $425/m for plans covering major medical risk. They boil down to 3 plan types, and EXCLUDE Rx, Hospital and or accident coverage. The key is what and how much is "limited".
People buying these plans have very limited resources and are glad for ANY insurance. Carriers selling them better understand the buyers budget. Marketing costs are very high and turn over is too, but for larger groups their is a profitable niche.After we got and A+ rated $600 billion carrier to back one for us, the market interest was poor. Why, because of the price for a product that actually offers reasonable coverage was a poor value.
Most carriers would not disagree that their greatest resource is selling low premiums to individuals. One carrier bragged about having one (major medical insurance) customer in every zip code in the US - John Alden. We know what happened to them. The authors compare Medicare individual sales to commercial individual sales which is apples and oranges.
