Cancer and critical illness supplemental plans

Many seniors are interested in purchasing supplemental coverage to cover help cover expenses for conditions/situations such as hospitalization, diagnosis of cancer, or critical illness. Seniors who have deductibles and/or copays in their Medicare Supplement or Medicare Advantage policies may want additional coverage for hospitalization, and all seniors may be interested in first diagnosis cancer and/or critical illness policies, as these plans pay benefits in addition to their Medicare Supplement or Medicare Advantage policies. These policies can be purchased in addition to a Medicare Supplement or Advantage policy and are NOT a substitute for these kinds of plans, although you can often purchase these types of policies without having Medicare coverage.

Several carriers offer these types of coverage but availability depends on the state where you live, the carrier, and your age.

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Hospital Indemnity

These policies pay a lump sum benefit (amount differs by carrier) upon hospital admission and contain provisions to buy additional coverage for each day of hospitalization up to the amount and number of days of coverage offered by the carrier. Additional riders can be added (varies by carrier) to cover items such as durable medical equipment, physician and surgeon benefits, RN at-home benefits, and daily skilled nursing facility benefits.

Depending on the carrier these policies are available through age 84. Availability and provisions vary by carrier and by state of residence, These policies are issued on a simplified issue basis which means that the offer of the policy depends on answers to some health questions, but these policies are not fully underwritten like individual health policies for individuals under age 65. They are offered on a guaranteed (i.e. no health questions) issue basis to individuals for those between age 64 ½ and 65 ½ in some states.

First Diagnosis Cancer

Depending on the carrier and state where you live, cancer policies can be purchased up to age 85. These policies pay lump sum benefits upon diagnosis for cancer. Payments can be used for any purpose including living expenses and are designed to pay expenses not covered by your Original Medicare (Parts A and B), Medicare Supplement or Medicare Advantage plan.

Critical Illness Policies

Depending on the carrier and state where you live, critical illness policies can be purchased up to age 70. These policies pay lump sum benefits for a list of critical illnesses, e.g. cancer, heart attack, stroke, and other illnesses and conditions such as organ transplants, paralysis, major burns, etc. Covered critical illnesses vary by carrier. Most carriers insure for a face amount and the face amount is paid when one of the critical illnesses occurs. Humana offers a policy that pays separately for each of three categories: vascular, cancer, and other listed critical illnesses. Assurity offers the same type of policy for issue ages through age 59.