FAQ Friday: Benefits of a Hospital Indemnity Plan and a Cancer Policy
If you have a Medicare Advantage Plan and are unable to purchase a Medicare Supplement because of health issues or maybe it’s not the time of year you are able to switch, there are a couple, separate plans that you can purchase that will help offset the costs you have with a Medicare Advantage Plan and your exposure with a Medicare Advantage Plan. The two most popular are the Hospital Indemnity Plan and a Cancer Policy. The two biggest holes in a Medicare Advantage Plan are hospitalization and Cancer treatments.
Most Medicare Advantage Plans are going to charge you anywhere from $250 to $400 a day you’re in the hospital for each day, days 1 though 7. A Hospital Indemnity Plan will protect you from this charge. How it works is if you are hospitalized, you would pay the co-pay to the hospital that your Medicare Advantage Plan requires you to pay. After that, you would submit a claim to the insurance carrier and the Hospital Indemnity Plan would then pay you per day that you were in the hospital. For example: If the co-pay for hospitalization is $250 per day; you’re in the hospital and you had a Hospital Indemnity Plan, it would pay you that $250 or $300 a day depending on the plan that you choose.
Two reasons that Cancer is one of the biggest holes in a Medicare Advantage Plan is first, that most Medicare Advantage Plans are going to require you to pay the 20% for chemotherapy or any other treatments you may need. The second is the Medicare Part D drug costs within the Medicare Advantage Plan.
Cancer Policies are fairly affordable plans (premiums around $30 a month). They are very similar to the Hospital Indemnity Plan in that if you have a Cancer Policy and are diagnosed with Cancer, the insurance carrier will send you a lump sum amount to use towards your treatment. For example: If you have a Cancer Policy that provides a $10,000 benefit with your Medicare Advantage Plan and you are diagnosed with Cancer, you would file a claim with the insurance carrier and the carrier would send you a check for a lump sum of $10,000 to use towards any service or medications.
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