Supplemental Health Insurance - An Overview
Supplemental health insurance is quickly becoming a necessity. Had I
known about it a few short years ago I would have bought it immediately. Hindsight is
What is it?
Supplemental health insurance is designed to pick up where your
normal health insurance leaves off. It can cover medical procedures, experimental
treatments, dental work, and vision care among other things. It can also cover your out of
pocket expenses, deductibles and copays associated with your other insurance plan, as well
as lost wages, transportation to treatment centers and even child care.
Who needs it?
Anyone with a high deductible or copay on their primary plan, anyone
with a family member who has special needs such as a history of heart disease or no sick
leave. If a major illness would wipe out your personal savings or your HMO or PPO provides
reduced reimbursement if you go out of network you should also consider supplemental
Let's look at my health plan a couple of years back. We had a PPO
with a fairly high deductible, a 20% copay for all expenses including hospital stays, and
a 10% penalty for going out of network. My husband and I were in good health, my pregnancy
was progressing with no problems, our savings account was growing slowing after paying for
our wedding, new car, and college loans. Should we have bought supplemental health
insurance? Yes. Did we? No. Guess what happened? I went into premature labor, while on
vacation. Oops. We lost wages, wiped out our savings account, and owed 20% of my
daughter's week long NICU stay. We weren't penalized because it was an emergency, but 20%
was still a lot.
We learned our lesson though. With my second pregnancy we were
prepared, and lucky. I was on bedrest for 3 months, delivered 2 months early, and our son
spent two weeks in the NICU. We saved about $20,000.
Ways to Save
Finding the right supplemental carrier is just as important as
choosing your primary health care plan. Compare several plans, look at what they cover and
how much they cost. Try to purchase them through your employer or any membership groups
you belong to such as your credit union or AARP to save money.
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