Why Does Health Insurance Exist? 
Health insurance came into being to help pay for catastrophic -LRB- large -RRB- medical claims . Initially health insurance plans only covered inpatient hospital stays . Over time some medical care that could only be handled as an inpatient became available on an outpatient basis . Also , new prescription drugs were developed to treat illness that earlier had been considered incurable . As these new -LRB- and quite expensive -RRB- drugs came on the market health insurance was expanded to cover outpatient services including Rx , extensive diagnostic testing such as MRI and CT scans and outpatient surgery . 