Insurance coverage for specific catastrophic events such as death, fire, flood, and some medical conditions.
Insurance designed to protect you from having to pay very high out-of-pocket costs. Catastrophic coverage usually begins after you have spent a pre-determined amount. Medicare Parts A and B do not offer catastrophic coverage. They always pay the same amount regardless of how much you have spent. The new Medicare prescription drug benefit (Part D) does offer catastrophic coverage. After you have spent a certain amount out-of-pocket ($3,600 in 2006), you will only pay five percent of the cost of each prescription (in addition to your monthly plan premium).
Insurance protection for extremely high health care costs.