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Supplemental health insurance adds extra protection to complement your primary health insurance

October 20, 2010

Question: What is supplemental health insurance?

Answer: Supplemental health insurance complements your base medical insurance by covering some or many of the expenses that would come as out-of-pocket expenses if you were to fall ill or get injured. Supplemental health plans kick in when the payout limits of your regular medical insurance end, covering such things as deductibles, additional hospital charges, or for some policies, other living expenses you cannot pay because you're sick or hurt and unable to work.

Many employers who provide health insurance to their workers also offer voluntary supplemental insurance that is paid for by the employee. Supplemental insurance comes in many forms and goes by many different names:

  • Dental or vision coverage is often offered as a supplemental policy
  • Medical bridge policies pay you directly when you need rehabilitation or outpatient surgery
  • Critical illness or disease specific insurance pays you if you suffer a stroke, heart attack, cancer, blindness or major organ failure
  • Accidental death or dismemberment coverage pays you if you are in an accident and are blinded or lose limbs, fingers or toes
  • Hospital indemnity insurance provides a daily, weekly or monthly cash allotment to those confined to the hospital. Some supplemental health insurance policies may provide coverage for pre-existing conditions.

People covered by group health insurance may purchase an individual supplemental policy if their primary insurance seems inadequate, or if they have special conditions that may not be covered by the group plan. Supplemental insurance can also cover family members not included in the employer-provided plan.

Another type of supplemental insurance is Medigap insurance, which covers costs not covered by Medicare. These policies fit into one of 12 different policies outlined by federal law.

You should consider several things before deciding to purchase supplemental health insurance:

  • The quality of your base or primary health insurance.
  • Your financial health. Are you be able to handle your everyday expenses--such as your mortgage or your child's tuition--if you were confined to a hospital and your income were curtailed?
  • The state of your health. If you're in good health, exercise and maintain a healthy weight you're not as likely to need supplemental insurance as someone who is in chronically poor health

Supplemental health insurance adds extra protection to complement your primary health insurance, but should not be your only medical insurance coverage.

Jim Sloan

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