By Marv Law, CLTC
With the changes in health insurance in recent years, more people are experiencing greater out of pocket medical expenses. Higher health insurance premiums have pressed many people to choose health plans with higher deductibles, co-pays and coinsurance so they can better afford the premiums. As a result, more consumers are experiencing increased medical bills, often even having to make arrangements with providers, doctors and hospitals to pay the bills.
Also, even though health insurance pays some of the medical bills, it never pays the other bills such as mortgage, rent, groceries, utilities, insurance, auto etc. If a critical illness or injury affects one’s ability to pay these bills, then health insurance alone may not be adequate financial protection. Here two types of insurance related to health that pays the patient directly and can often avoid large financial pitfalls.
- Supplemental insurance helps cover gaps in health insurance to reduce and sometimes even eliminate out of medical pocket expenses. These plans typically pay cash benefits directly to a person diagnosed with a critical illness such as cancer or heart disease. They can also pay when an individual is confined to the hospital or has an injury and offset out of pocket expenses for doctors and treatment.
- Income protection in the event of an illness or injury can replace income to help pay for all the other bills if an individual is unable to work. These plans can be short term or long term disability plans and customized depending on the need, age of consumer, budget and other family and financial resources available to the individual.
When developing a strategy to cover expenses if you get sick or hurt, health insurance alone is often an insufficient plan if it does not also pay you when you need it the most to use that money as you choose to use it. However when these plans that pay you directly are combined in a comprehensive strategy along with health insurance, they form a strong financial bridge of protection. A properly designed plan can be very affordable and provide a better value than medical insurance alone, giving consumers more viable options when seeking for more affordable health insurance.