Supplemental health insurance is a plan that covers costs that exceed what standard health insurance pays. It may offer additional coverage and can even pay for expenses not covered by traditional health insurance, such as copayments, coinsurance, and deductibles.
How Does Supplemental Health Insurance Work?
Having supplemental health insurance can help you pay for healthcare costs that traditional health insurance may not always cover. Some plans cover specific events such as hospital stays or disability, while others cover certain health conditions like cancer. It all depends on the type of supplemental health insurance plan you choose.
Supplemental health insurance may pay benefits either to the insured person or to the healthcare provider. The amounts paid and how they are paid will depend on the plan. Here are some types of supplemental health insurance policies:
Critical Illness Insurance or Specific Disease Insurance
This type of plan often provides a cash benefit paid to you if you need treatment for a specific illness like cancer. You can spend the cash on anything you choose if it does not go to your provider. Receiving your benefit is not related to how much your plan pays for medical care expenses.
Accidental Death and Dismemberment Insurance
This type of plan reimburses medical expenses resulting from accidents. Benefits are paid to your designated beneficiaries if the event results in your death.
Premiums are often low, and no medical exam is required. Accidents can include both car accidents and accidents at home. You may be able to collect a portion of the death benefit if you lose limbs, fingers, toes, or vision due to a covered accident.
Hospital Indemnity Insurance
This plan provides a daily cash benefit weekly or monthly if you are hospitalized. There is often a minimum hospital stay before benefits are paid. The cash benefit is paid directly to you. It is in addition to any other insurance you may have.
Most supplemental health insurance plans are not sold through the health insurance marketplace, but many employers offer them. You can also purchase them directly from insurance companies.
Do I Need Supplemental Health Insurance?
Whether you need this type of health insurance depends on your risk factors. You should also consider the cost of premiums and how much coverage you want to carry and what you want to insure. You might decide to purchase cosmetic medical coverage if you think your children will need it to cover orthodontic care in the coming years.
You may consider a supplemental plan if you know you cannot afford long-term care costs or lost income if you are diagnosed with something like cancer. Long-term care or critical illness plans may be worth considering in these cases.
Your savings should play a significant role in your decision to purchase a supplemental health insurance plan. Do you have enough money to cover deductibles, copayments, and coinsurance if you are hospitalized for a few weeks or more? Do you have funds accessible because you have been saving in a health savings account or flexible spending account? Buying a supplemental health insurance plan may not be worth it if you have these resources.
Frequently Asked Questions (FAQs)
When can I change my supplemental health insurance plan?
Generally, you cannot change your supplemental health insurance (Medigap) unless you are within a six-month open enrollment period that starts in the first month you get Part B of Medicare. Once you obtain coverage, you have a “free look” period of 30 days to change plans. After that, special circumstances such as moving to a new state will give you the right to change policies.
What
What is the percentage of patients who have additional health insurance?
Approximately 84% of patients with supplemental health insurance (Parts A and B) had some form of additional insurance in 2019. This figure includes Medigap patients and those who supplemented Medicare with other types of coverage such as employer plans.
Was this page helpful?
Thank you for your feedback! Let us know why! More
Sources:
National Cancer Institute. “Supplemental Health Insurance.”
Guardian. “Critical Illness Insurance.”
The Hartford. “Accidental Death & Dismemberment Insurance.”
MetLife. “Hospital Indemnity Insurance.”
Medicare.gov. “When Can I Buy Medigap?”
Medicare.gov. “Switching Medigap Policies.”
Department of Health and Human Services. “Medicare Beneficiary Enrollment Trends and Demographic Characteristics,” Page 7.
Source: https://www.thebalancemoney.com/the-basics-of-a-supplemental-health-insurance-plan-2645664
.lwrp .lwrp-list-item.lwrp-empty-list-item{
background: initial !important;
}
.lwrp .lwrp-list-item .lwrp-list-link .lwrp-list-link-title-text,
.lwrp .lwrp-list-item .lwrp-list-no-posts-message{
}@media screen and (max-width: 480px) {
.lwrp.link-whisper-related-posts{
}
.lwrp .lwrp-title{
}.lwrp .lwrp-description{
}
.lwrp .lwrp-list-multi-container{
flex-direction: column;
}
.lwrp .lwrp-list-multi-container ul.lwrp-list{
margin-top: 0px;
margin-bottom: 0px;
padding-top: 0px;
padding-bottom: 0px;
}
.lwrp .lwrp-list-double,
.lwrp .lwrp-list-triple{
width: 100%;
}
.lwrp .lwrp-list-row-container{
justify-content: initial;
flex-direction: column;
}
.lwrp .lwrp-list-row-container .lwrp-list-item{
width: 100%;
}
.lwrp .lwrp-list-item:not(.lwrp-no-posts-message-item){
}
.lwrp .lwrp-list-item .lwrp-list-link .lwrp-list-link-title-text,
.lwrp .lwrp-list-item .lwrp-list-no-posts-message{
};
}
Leave a Reply