Hospital Indemnity Insurance
Many consumers purchase Hospital Indemnity Insurance Plans to help offset the hospital co-pays of their Health Insurance Plans such as Medicare.
Some of the better plans include daily hospital , ambulance, skilled nursing, durable medical equipment, lump sum cancer, and surgical benefits.
A hospital indemnity plan provides coverage no matter where you get care in the United States. All benefits are paid directly to you. Health insurance does not cover all of the costs associated with injuries or illnesses.
In addition to deductibles and coinsurance, consumers may incur extra expenses. This could be a private room and private duty nursing fees, transportation, lawn and house care, and pet care.
In addition to deductibles and coinsurance, consumers may incur extra expenses. This could be a private room and private duty nursing fees, transportation, lawn and house care, and pet care.
So What Is Hospital Indemnity Insurance?
The first thing to understand is that hospital indemnity insurance pays cash benefits directly to the policyholder. This happens regardless of any other insurance they may have. As the benefits are paid directly to you, you can use the funds to cover your immediate expenses.
In addition, many plans allow you to not only have the base coverage for each night that you spend in the hospital, but will also allow you to purchase riders to include such things as:
Ambulance coverage – many times an individual might incur an ambulance charge (especially if they have a Medicare Advantage plan). Including this rider at a reasonable cost provides benefits for the service, even if no hospital stay occurs.
Skilled Nursing Facility coverage – while traditional Medicare covers the first 20 days of skilled nursing facility care (after an individual spends 3 prior nights in the hospital before entering the facility), sometimes folks do not end up meeting the 3 day prior night requirement. Also, those folks covered by a Medicare Advantage plan may not have first day coverage and might have to cover a daily co-payment in the skilled nursing facility during the first 20 days. This rider puts the money directly in your pocket to use as needed.
Lump Sum Cancer Rider – with cancer affecting so many folks above the age of 65, this rider is a very important one. If you received a cancer diagnosis, where would you prefer to receive treatment? Would you want to go to the best cancer specialist or facility for the type of cancer you have? Of course you would! This rider puts thousands of dollars in your hands upon diagnosis of a life threatening cancer. Now you can get the treatment you deserve!
In addition, many plans allow you to not only have the base coverage for each night that you spend in the hospital, but will also allow you to purchase riders to include such things as:
Ambulance coverage – many times an individual might incur an ambulance charge (especially if they have a Medicare Advantage plan). Including this rider at a reasonable cost provides benefits for the service, even if no hospital stay occurs.
Skilled Nursing Facility coverage – while traditional Medicare covers the first 20 days of skilled nursing facility care (after an individual spends 3 prior nights in the hospital before entering the facility), sometimes folks do not end up meeting the 3 day prior night requirement. Also, those folks covered by a Medicare Advantage plan may not have first day coverage and might have to cover a daily co-payment in the skilled nursing facility during the first 20 days. This rider puts the money directly in your pocket to use as needed.
Lump Sum Cancer Rider – with cancer affecting so many folks above the age of 65, this rider is a very important one. If you received a cancer diagnosis, where would you prefer to receive treatment? Would you want to go to the best cancer specialist or facility for the type of cancer you have? Of course you would! This rider puts thousands of dollars in your hands upon diagnosis of a life threatening cancer. Now you can get the treatment you deserve!
Most Frequently Asked Hospital Indemnity Plan Question:
“Why should I consider an extra plan like this if I already have a Medicare Advantage or Group Health Plan?
The easiest way to explain this is with an example of a 65 year old consumer who has purchased a health insurance plan that has a hospital co-pay of $250 per day for the first 5 days that the consumer is responsible for paying.
This means that the consumer has up to $1,250 they could be responsible for during a hospital stay.
If this individual were to go into the hospital for a 7 day stay, they would be responsible for paying $1,250 in co-pays.
Additionally, let’s assume that an ambulance took this person to the hospital.
Let’s say the health insurance plan the consumer purchased has a conservative co-pay of only $50 for each ambulance trip.
Keep in mind that most of the plans have ambulance co-pays that range from $100-$200 per trip.
The easiest way to explain this is with an example of a 65 year old consumer who has purchased a health insurance plan that has a hospital co-pay of $250 per day for the first 5 days that the consumer is responsible for paying.
This means that the consumer has up to $1,250 they could be responsible for during a hospital stay.
If this individual were to go into the hospital for a 7 day stay, they would be responsible for paying $1,250 in co-pays.
Additionally, let’s assume that an ambulance took this person to the hospital.
Let’s say the health insurance plan the consumer purchased has a conservative co-pay of only $50 for each ambulance trip.
Keep in mind that most of the plans have ambulance co-pays that range from $100-$200 per trip.
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Currently this consumer is now up to $1,300 in co-pays that they are responsible for.
This same consumer could purchase a hospital indemnity plan with an ambulance rider that would pay $250 per day in the hospital and $200 per ambulance trip for less than $22 per month.
This plan would have paid on this particular situation $1,250 for the hospital stay and $200 for the ambulance trip for a total of $1,450.
For most consumers it is much easier to budget a monthly premium of around $22.00 for Hospital Indemnity Insurance than to come up with $1,450 or more at one time.
This same consumer could purchase a hospital indemnity plan with an ambulance rider that would pay $250 per day in the hospital and $200 per ambulance trip for less than $22 per month.
This plan would have paid on this particular situation $1,250 for the hospital stay and $200 for the ambulance trip for a total of $1,450.
For most consumers it is much easier to budget a monthly premium of around $22.00 for Hospital Indemnity Insurance than to come up with $1,450 or more at one time.
Highlights of Hospital Indemnity Plans
Not all plans or riders are available in every state.
Limited benefit plans, Hospital Indemnity Insurance plans pay all benefits directly to the consumer.
In addition to any other insurance plan the policyholder might have, the policy will pay benefits.
These plans don’t supplement other health insurance or replace any traditional health insurance you possess.
Limited benefit plans, Hospital Indemnity Insurance plans pay all benefits directly to the consumer.
In addition to any other insurance plan the policyholder might have, the policy will pay benefits.
These plans don’t supplement other health insurance or replace any traditional health insurance you possess.
Alternatives To Hospital Indemnity Plans
While a Hospital Indemnity Plan may be right for you, a more commonly purchased solution is a Medicare Supplement Plan.
Many of the plans, such as Medigap Plan F and Plan G, will cover the costs for whatever Medicare Part A does not cover.
Many of the plans, such as Medigap Plan F and Plan G, will cover the costs for whatever Medicare Part A does not cover.
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Understanding Coverage Types and Payments
Hospital indemnity plans are a type of insurance policy that covers certain unpaid costs left by your essential healthcare. Depending on the indemnity plan you choose, the insurer pays a designated amount either per visit, per day, week, or month that you are in the hospital for medical care.
These plans are considered supplemental insurance coverage that can’t stand alone as your primary basic healthcare coverage. As indemnity plans aren’t counted as minimum essential coverage, they are intended to complement your essential coverage by aiding in costs left unpaid.
These plans are considered supplemental insurance coverage that can’t stand alone as your primary basic healthcare coverage. As indemnity plans aren’t counted as minimum essential coverage, they are intended to complement your essential coverage by aiding in costs left unpaid.
Impact on Medical Debt
Unfortunately, many people are currently struggling to pay back medical bills left unpaid by insurance companies. Medical debt causes undue stress on families, some of whom are forced to take money from retirement, college, or other long-term savings to pay back exorbitant hospital services fees.
Medicare Advantage Cost Sharing Example
Many Medicare Advantage plans have daily co-pays of $300 per day for up to a certain amount of days.
If you happen to have an Advantage plan with a cost sharing expense of $300 per day for the first 5 days in the hospital, then your exposure is $1500 for that stay.
Hospital indemnity plans allow you to put that financial exposure onto the insurance company. In essence you are buying dollars of coverage for pennies.
If you happen to have an Advantage plan with a cost sharing expense of $300 per day for the first 5 days in the hospital, then your exposure is $1500 for that stay.
Hospital indemnity plans allow you to put that financial exposure onto the insurance company. In essence you are buying dollars of coverage for pennies.
Take Action!
With your enhanced grasp of Hospital Indemnity Plans, engage a Senior Benefit Services expert to address your situation.
Contact a Senior Benefit Services advisor at (800) 924-4727 to determine if a hospital indemnity plan is right for you.
You are never under any cost or obligation.
Contact a Senior Benefit Services advisor at (800) 924-4727 to determine if a hospital indemnity plan is right for you.
You are never under any cost or obligation.
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