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What is Supplemental Health Insurance?

Health insurance.
A supplemental health insurance agreement.
A health insurance claim form.
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  • Written By: O. Wallace
  • Edited By: Niki Foster
  • Last Modified Date: 10 July 2014
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Supplemental health insurance is a type of insurance policy designed to cover the gaps that your regular health insurance may have due to deductibles and co-payments. It covers additional expenses that your primary insurance doesn’t cover, such as lost income and living expenses. Those who should consider this type of insurance are the self employed, families with children, those financially unprepared to handle large medical bills or time off from work due to illness or injury, and those on Medicare.

Some of the benefits of a supplemental health insurance policy include cash benefits, lower cost due to lower benefit amounts, the ability to offset lost income unlike a traditional health insurance policy, and often payment for pre-existing conditions. The most common type of supplemental policy is intended for those covered by Medicare, which doesn’t cover long term health care, at home care, nursing homes, or prescription drugs. Many seniors opt to carry a Medicare supplement in addition to long term care insurance, which protects their financial security. Unfortunately, these two supplemental insurance policies can run up to 4,000 USD annually.

For many people, supplemental health insurance conjures up images of an obnoxious duck quacking “AFLAC!,” but there are many other insurance companies offering a veritable smorgasbord of supplemental health insurance policies. While a plan like AFLAC provides a cash benefit to those out of work due to illness or injury, other plans provide cash benefits for a number of specific reasons.

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In addition to hospital indemnity plans which provide fixed cash benefits for covered services, including hospital stays for emergencies and outpatient services, there are basic supplemental medical plans that provide fixed benefits for covered preventative medical care. For those worried about cancer, there are supplemental cancer insurance plans which give direct cash to policy holders for cancer treatments and related expenses. For situations involving a critical condition or illness, there are policies which give lump sum benefits to help pay out of pocket expenses for heart attacks, strokes, heart surgeries, cancer, and other illnesses.

Statistics show that becoming unexpectedly disabled can be financially devastating for any family. Disability income protection helps guard against sudden lost income by providing a monthly benefit to help pay the bills. Long term care insurance helps policy holders deal with the high cost of long term care, including assisted living facilities, medical home care, adult day care, and so on. With the cost of regular health care spiraling ever higher for everyone, especially the self-employed, supplemental health insurance is becoming a must have for anyone looking to stay physically and financially healthy.

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Discuss this Article

anon316585
Post 29

I'm looking for a supplemental health policy. I already have a major health plan through my work, but not all is covered. There are so many choices; it's mind boggling.

I called AARP and they have only something called a "cash benefits hospital" stay plan. I need one that also covers lab tests as my insurance, to my dismay, is not covering these all the way. Some are for those over 65. I am only 53, and still working.

I can't afford much, but feel that I should have something else in place if I should have some illness. I am relatively healthy. Can you help with narrowing down the Supplemental Insurance Plans so I don't make a costly mistake?

anon301658
Post 28

Stay away from Colonial Life. They promise to cover you as long as it's not a pre-existing condition. It's a complete rip off. I could have saved the money I put into this company and paid my medical bills instead of paying them for what I thought was accident insurance. My husband had knee surgery and because I had not been with them a year they called it a pre-existing condition. They also took six months to decide that. When I explained to them that I was misinformed when the sales person sold it to me, they said it was too bad.

So, I've dished in almost an entire year of money and received nothing in return but a bunch of lies. I posted the problem on Facebook three weeks ago, received an email that they were looking in to it, but have not received anything else. If you are going to choose to buy supplemental insurance go with Aflac. They haven't let my family down. The only reason I gave Colonial Life a try was because my employer was on board with them. Big mistake!

anon272213
Post 27

So my husband has had Colonial supplemental insurance since 2001. We have used it and in November he wanted to update his income information so if he needed it, he would get the correct amount.

Well, he sent a letter off to them and did not hear back at all. In April he was diagnosed with a ruptured disc and was told no work at all until six to eight weeks after surgery. He applied to Colonial for his supplemental insurance and once again inquired about the change in benefit amount.

Two weeks later we did get a check for a little bit and a letter explaining that they are not able to change his premium since his current employer does not have Colonial as its provider for this type of supplemental insurance.

anon261871
Post 26

Supplemental health insurance is nice and very useful for me being a sales executive at one of the medical suppliers in Malaysia.

anon253211
Post 24

My brother died last year at a hospital on the other side of the country. My sister and I are now getting calls from an insurance agent. She says our brother had supplemental health insurance and we are entitled to the benefits. She wants to send us information and documents to sign, to claim this money. I never heard of health insurance paying off to family survivors. Is this legitimate?

anon246071
Post 22

Washington National has excellent supplemental plans!

anon139765
Post 21

I have a 34 year old disabled son on Medicare. Is he eligible for a supplemental policy?

anon137715
Post 20

Does a senior have to enroll in a supplemental plan by 12/31 even though he is already on Medicare A and B?

anon133691
Post 19

anon2891, check out the American College Student Association for policies for students by United HealthCare. I'm not sure if you are a high school student or a college student but you should be able to get coverage if you are able to enroll or are currently enrolled in college. Pregnancy is covered and not considered a pre-existing condition.

anon125342
Post 18

I had a lifetime contract for supplemental medical insurance, PPO, sharing premiums @80 percent-20 percent with my employer. The company just declared chapter 11 bankruptcy. I'm 76. Does anyone have a suggestion for me to look for coverage?

anon112683
Post 16

So helpful! This article has been a great help.

Carola3173
Post 14

Great article, five stars! It is very important for everyone to have health insurance. If you don't have insurance and you have to go to hospital, you'll have to pay over $20,000. That happened to a friend of mine.

anon84243
Post 12

To everyone knowing the importance of Supplemental Health Insurance, there is another company besides AFLAC. Colonial Life has excellent health and Life products at great group rates with minimal health questioning.

The company is getting employers to offer the plans to their employees. A group constitutes only two people. (There is a minimal premium dollar amount that has to be reached, but its a doable!) So the size of the company does not matter.

Finally, small company owners can offer their employees the best benefits at large company rates! They also offer individual policies as well. When shopping for supplemental insurance, give Colonial Life a call. They are less expensive than AFLAC and their policies are more better. Their claims are paid promptly. They have the "harmony" enrollment system that alleviates the burdensome hassle of enrolling -- they do it all!

I know AFLAC has an excellent cancer policy, but Colonial Life is just as good! But look into Colonial's accident and short term Disability, too. Wow. That plan saved my son and his wife their house! He got hurt on the job and needed to stay out of work for 12 days. His wife is pregnant and not working and the Colonial claim was paid in seven working days. The lump sum paid their mortgage, electricity bill and groceries. It costs him less than $5.00/week and is automatically deducted from his pay check.

It's too bad the company does not advertise with a cute frog or bird that squeaks or chirps to get such attention, but they are a straight forward, pleasant company that does not want any claim unpaid. The company is off like wild fire in South Florida.

Hats off to Colonial Life and its supplemental health and life policies. Group rates with group underwriting. Often businesses can offer guaranteed issue to their employees because five or more employees have signed up which is a life saver if an employee has a past medical history. Their pay outs are huge, their process is simple and their team approach lets each policy owner know they will be well taken care of from the one on one enrolling through out the benefit period. Their web site is awesome, very user friendly.

anon79767
Post 11

I did some checking myself which made me wind up here on this site too. The fact is there are only a few to check out in way of companies.

As far as getting coverage while pregnant, it's already too late from time of conception. When my friend's wife was pregnant she couldn't be accepted for coverage once pregnant but you most likely can do what they did which is apply for medicare for that reason alone.

anon72744
Post 10

There is another company that offers supplemental health benefits, and their prices are more affordable than AFLAC!

This company gives you return of premium back regardless of your claims. You have it when you need it and if you don't use it you get your premium money back! And yes, all the benefits go directly to you. Check it out. In today's world we need to save money. Conseco is the best!

anon69200
Post 9

anon 38733, look for supplemental insurance with aflac or (there's a list). indemnity plans cost about half of what medical plans cost and offer cash payouts to help with daily living expenses.

anon68856
Post 8

to anon2891, last time i checked that's called a pre-existing condition and may not be covered by by supplemental health care insurance. It won't hurt to double check though.

anon38733
Post 5

I have good insurance via cigna/metlife, however I have very serious health issues that are costing me about 1000 dollars per month in co-pays for meds and doctors' appointments. Is there anything out there that can assist with this?

The health issues include:

diabetes (insulin, and meds); arthritis (surgeries, meds, physical therapy); neuropathy (due to the diabetes, meds, specialists, etc.); sleep apnaea (cpap, meds, specialist); etc.

anon20512
Post 4

Dear anon2891, your state should be able to offer you what is called Pcap, which is specified coverage for women who are pregnant. If not then check with your local medicaid office, since family planning is considered separate from normal medicaid. You could have coverage for your care until about 3 months after birth. Hope it helps.

anon16268
Post 3

As an AFLAC policyholder, stockholder and past agent, I can tell you with confidence that AFLAC is MUCH more than just "the Duck" and they provide every policy that your author then goes on to explain that "other" companies provide.

AFLAC's commercials do focus on the fact that if someone is out of work due to an illness or injury they will get paid because in a short time slot, like a commercial, it's the easiest message to get across without going into full detail.

AFLAC was started in 1955 and in 1957 they pioneered and introduced the very first cancer plan. In the 1970's they pioneered and introduced the first intensive care plan. Since that time they have gone on to introduce Medicare supplements, hospital indemnity, accident, short-term disability, dental, vision, life and more.

AFLAC's plans are guaranteed-renewable and a policyholder will NOT be dropped for having used their policy, nor will their rates be raised simply for having to cash in on their policy.

One of the most significant details of any supplemental insurance is that the benefits are paid directly to the policyholder to be used in the manner they need to use it most. This means that the benefits are NOT paid to the service provider like traditional insurance monies are.

AFLAC, along with many of its competitors, strongly encourage people to also carry traditional health insurance as supplemental insurance can't begin to cover the extremely high medical costs of our times, however what supplemental insurance will do is provide cash-in-hand to cover day-to-day living expenses among other things too expansive to cover in this email.

Supplemental insurance is NOT just for an exclusive and short list of people. Even those with good insurance coverage and those with financially sound portfolios should check it out. A medical nightmare like Cancer or a devastating accident or rare disease can wipe out savings accounts, college funds and retirement funds in the blink of an eye. Having a supplemental plan in place negates having to use the hard earned nest egg in case of such an emergency.

Again, I speak from experience as 7 years ago I was diagnosed with a tumor causing a rare condition known as Cushing's Disease. My husband and I both had good jobs and good insurance, however due to traditional health insurance not covering everything and my having to be out of work, not to mention the high cost of meds before and after, we lost everything. Knowing what I do now about supplemental insurance plans, we would have turned out much better had we had a supplemental policy in place.

Although I am most passionate about AFLAC, their company philosophy and products, I do not mean for this to be an ad for AFLAC. There are a number of strong and legit companies who offer supplemental benefits and are worth checking into, such as Allstate, Colonial, and Combined Insurance.

I believe that the subject matter is an important one and the author has covered good points, however I feel that readers need very clear details and the utmost accurate information on such a vital topic.

Respectfully, M. Reese Baltimore, MD

airide
Post 2

Are there any insurance that will pick up after the $2400 dollar gap is met with the supplemental insurance, aligned with the Medicare part d drug plan?

anon2891
Post 1

I'm a student (19) and still on my parents insurance. I'm pregnant; and I'm not covered under my parents insurance. Can I buy supplemental insurance to pay for my medical bills?

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