Supplemental Insurance Helps Bridge the Health Insurance Coverage Gap

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Supplemental Health Insurance

During the final weeks of the current open enrollment period, health insurance is at the top-of-mind for individuals of all ages. Seniors and others qualifying for Medicare benefits have been bombarded with mail and TV ads touting comprehensive Medicare Advantage plans, as well as Part D Rx plans and no-network, fee-for-service plans designed to work with traditional Medicare benefits.

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At the same time, individuals of all ages who rely on employer healthcare benefits may be faced with increased co-pays, deductibles, and co-insurance out-of-pocket costs, as businesses try to contain these expenses. And, consumers who purchase individual and family plans through an exchange offered under the Affordable Care Act are also now seeing those same increases, as well as a rise in monthly premiums.

Once these crucial major medical choices are made for 2015, it’s a good idea to take a close look at your health insurance policy and consider how supplemental insurance can help pay the out-of-pocket costs that major medical doesn’t cover.

The “Hidden” Costs of Illness or Injury
While major medical insurance plans from an employer, private policy or Medicare may cover a good percentage of medical expenses, they do not cover copays, deductibles, and co-insurance costs. Those costs become the financial responsibility of the insured. In addition, major medical plans also do not cover the hidden costs of an illness or injury. Some of these “hidden” costs include:

• Lost income resulting from time off the job due to illness or injury
• Transportation costs to and from physicians’ offices, diagnostic test sites and hospitals or clinics
• Hiring of outside help for child care, cooking and other household duties

Supplemental insurance plans can also help with these “hidden” out-of-pocket expenses because they typically pay cash benefits directly to the insured. In some cases, employers offer supplemental insurance plans at work that employees can purchase. Consumers can also obtain one or more affordable policies on their own from reputable, highly-rated insurance firms.

Having supplemental insurance can provide financial protection and peace of mind by adding an additional safety net in the event of an unexpected illness or injury. Best of all, the insured can use the cash benefits however they choose – for out-of-pocket medical expenses, to cover transportation costs, or even to help pay routine monthly bills and keep finances on an even keel.

Different Types of Supplemental Insurance
Supplemental insurance providers offer several different kinds of plans, each offering coverage for a particular illness, group of illnesses, injury or life-changing event. For example, accident and sickness insurance can be structured to provide coverage in the event of unexpected illness, or an injury incurred at home, work or play. Some policies offer coverage even for injuries incurred when driving a car, truck, motorcycle or bicycle, or as a passenger on a commercial aircraft.

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Cancer insurance can be tailored to provide cash benefits in the event the covered individual or family member is diagnosed with cancer and requires diagnostic testing, surgery, and ongoing treatment and aftercare.

Critical care insurance provides varying benefit options covering a range of serious, life-changing illnesses, such as heart attack, stroke, cancer, and MS, or a disabling injury resulting in blindness, brain damage or the amputation of limbs.

Supplemental disability insurance policies provide monthly payments in the event of a disabling illness or injury. For many people, this extra measure of protection can help to replace lost income and help an individual or family keep up with monthly bills such as rent, mortgage, or car payments.

Finally, supplemental life insurance typically offers a cash benefit to a wage earner or family member upon notification of death. Some supplemental life policies also offer additional options, such as higher benefits for an accident-caused death.

Extra Protection More Important Than Ever
In today’s climate of escalating medical costs and economic uncertainty, it’s more important than ever for consumers to protect their assets and allocate their resources wisely. Unexpected accidents and illness happen to everyone at one time or another and it’s important to be prepared, financially speaking.

According to the American Cancer Society, cancer will strike one out of three people and affect three out of four families. Thanks to advances in modern medicine, 68 percent of cancer patients survive for five years or more after diagnosis. Similarly, the American Heart Association notes that each year over 1.2 million Americans will have a heart attack, and more than 700,000 will suffer a stroke. For many families, however, the out-of-pocket costs for treatments and aftercare for serious illness or injury can often be financially devastating. In fact, statistics show that many in the U.S. file for bankruptcy in the aftermath of a serious health condition.

While supplemental insurance is not intended to replace major medical insurance or long-term life or disability insurance, it provides an extra level of protection and peace of mind when you need it most.

In selecting supplemental insurance, it’s important to compare different policies to determine which plan or plans offer the best fit for your situation, age and budget. Most important, only do business with a supplemental insurance provider that continually maintains high ratings by A.M. Best, Ward’s and other leading companies that rate life-health insurers. You’ll soon discover that a relatively small investment can provide the peace of mind that you are better prepared should that unexpected injury or illness strike you or your family.

About the Author
Janet Martin is vice president of product innovation for Combined Insurance, a leading provider of individual supplemental insurance products and an ACE Group company. For more information, visit us at www.combinedinsurance.com.

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