Medical Expense Benefits
Medical expense insurance, commonly referred to as hospitalization
insurance,provides benefits for expenses incurred due to in-hospital
medical treatmentand surgery as well as certain outpatient expenses—such
as doctor’s visits, labtests, and diagnostic services. Hospitalization
insurance may be issued as anindividual policy covering all family
members or as a group insurance policy
provided through an employer-sponsored program.
When medical expense coverage provided for proprietors and partners
is paid for by the business, the premiums have traditionally been
considered taxdeductible to the business but includable as income
to the individual. Thereis no limit to the amount of tax-free medical
expense benefits the individual
can receive, however.
