What Is Supplemental Health Insurance

Supplemental health insurance is a plan that covers costs above and beyond what standard health policies will pay. It may provide extra coverage.

It may even pay for costs not covered by a traditional health plan, such as coinsurance, copays, and deductibles.

How Does Supplemental Health Insurance Work?

Having supplemental health insurance in place can help you pay for health care costs that aren’t always covered by traditional health plans.

Some cover certain events, such as hospital stays or disability. Others cover certain health conditions like cancer.

Supplemental health Insurance
what is Supplemental Health Insurance? Photo courtesy (Roamright.com)

It all depends on the type of supplemental health plan you choose.

Supplemental health plans may pay benefits to either the insured person or to the health care provider.

The amount that’s paid and how it’s paid out will depend on the plan.

These are a few types of supplemental health policies.

Critical Illness or Disease-Specific Insurance

This type of plan often provides a cash benefit paid to you if you need treatment for a certain disease such as cancer.

You can spend the cash any way you choose if it doesn’t go to your care provider.

Getting your benefit has nothing to do with how much your plan pays for your medical costs.

Accidental Death and Dismemberment Insurance

This type of plan will reimburse you for medical costs that result from accidents.

Note: Benefits are paid to your beneficiaries if the event causes your death.

Also read: How Is Health Insurance Calculated In Child Support?

The premiums are often low and no medical exam is required.

Accidents can include both automobile collisions and accidents in your home.

You may be able to collect a portion of the death benefit if you lose limbs, fingers, toes, or your vision due to an accident that’s covered.

Hospital Indemnity Insurance

This type of plan provides a daily, weekly, or monthly cash benefit if you are hospitalized.

There is often a minimum hospital stay before benefits will be paid.

Supplemental Health Insurance
Supplemental Health Insurance: Photo courtesy(Yourinsuranceaid.com)

The cash benefit is paid to you. It is in addition to any other insurance you may have.

Note: Most supplemental health plans aren’t 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?

Need this health plan based on risks, costs, coverage preferences.

Dental if kids need orthodontics.

Supplemental if can’t afford long-term care or loss of income (e.g., cancer).

Savings important – cover costs without plan? HSA/FSA savings might make supplemental plan unnecessary.

Frequently Asked Questions (FAQs)

When can I change my Medicare supplemental insurance plan?

You typically cannot change your Medicare supplemental insurance (Medigap) unless you’re within your six-month open enrollment period that begins the first month you have Medicare Part B. Once acquiring coverage, you have a 30-day “free look period” to switch plans. After that, only special circumstances like moving to a new state will give you the right to switch policies

What percentage of Medicare patients have supplemental insurance?

Roughly 84% of Medicare patients (Parts A and B) had some type of supplemental insurance coverage in 2019.7 This figure includes Medigap patients as well as those who supplemented Medicare with other types of coverage like employer-sponsored plans.

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