In today’s world of rising health care costs, employers are looking for ways to manage their medical spending. This often means asking employees to share more of the cost via copays, coinsurance and deductibles. The prevalence of high-deductible health plans has led some insurers to develop expense-based and fixed-payment medical plans that help close these coverage gaps.

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Closing the coverage gap

Two solutions for closing coverage gaps are benefit plans that include everyday services like doctor office visits, surgeries and hospital stays.


Expense-based plans:

  • Pay benefits for covered expenses up to an overall plan max.
  • Offer customized coverage amounts in a way that closes the major medical coverage gaps from deductibles, copays and coinsurance.
  • Directly tie the benefits received to expenses incurred.


Fixed-payment plans:

  • Pay a set dollar amount for covered medical events on a per day basis.
  • Pay benefits for each day of service until the calendar year max is reached.

Both plans are designed to help reduce the impact of out-of-pocket costs, but they differ in their approach.

  • Expense-based plans are generally structured to cover out-of-pocket expenses until the major medical deductible is met.
  • Fixed-payment plans are generally broader in scope and continue to pay even after the major medical deductible is reached.


To learn more about expense-based and fixed-payment plans, read our Inside Track educational paper >