Workplace Benefits
7 Things Medical Insurance May Not Cover If You Get Sick
We’d all like to think we have the insurance coverage needed to treat a critical illness, like COVID-19i, heart attackii, or stroke.1 But that may not be the case.
That’s because medical insurance may only cover a portion of the costs associated with a serious illness, leaving you to potentially pay thousands out of pocket. According to a report by Salary Finance, about one in three working Americans have medical debt, and more than half of them have defaulted on it.
Fortunately, you can take proactive steps—like signing up for Critical Illness Insurance—to help protect your finances.
What is Critical Illness Insurance, you wonder? In short, it's a voluntary insurance plan that gives you a lump-sum benefit payment upon diagnosis verification of certain covered illnesses. And you can use the money as you see fit, such as for the following expenses, amongst others:
1. Out-of-network care
Some medical plans may offer limited out-of-network coverage, while others may offer none. That means you may end up paying more to see a provider outside of your network.
Critical Illness Insurance pays a lump sum benefit payment directly to you, not the provider, that could be used towards out-of-network care.
2. Your medical insurance deductible
The average deductible (the amount you have to pay out of pocket before your insurance kicks in) is around $1,655, the Kaiser Family Foundation reports.
But what if you haven't met that deductible when you're diagnosed with a serious illness? Luckily, there is no deductible with Critical Illness Insurance. You can file a claim as soon as you are diagnosed with a covered illness and receive a lump-sum benefit payment, which can be used to cover expenses such as your medical insurance deductible.
3. Copays and coinsurance
Known as cost-sharing, copays and coinsurance are fees you may pay healthcare providers, which could come as a shock when you're treating a critical illness. Case in point: The average American family spends up to $5,000 in out-of-pocket medical costs yearly.
Your lump-sum critical illness benefit payment can be used to cover expenses such as co-pays and coinsurance.
4. Alternative medications and treatments
Many medical insurance plans may stipulate which medications or treatments they’ll cover. The list varies by plan and may not include prescriptions your doctor recommends for you, experimental therapies, or other treatments, like acupuncture.
If you choose these services, the costs may be your responsibility. Even if you file an appeal with your medical insurance provider, there’s the possibility that it can be denied, leaving you to foot the bill on your own.
With Critical Illness Insurance, you can use the lump-sum benefit payment to cover expenses such as the costs of alternative treatments and therapies recommended by your doctor.
5. Certain durable medical equipment (DME)
DME is the items you may need as you recover or live with a medical condition. This equipment may include wheelchairs, oxygen tanks, CPAP machines, and blood glucose testing kits, for example.
Some medical insurance plans may cover DME, if it's considered medically necessary to live. However, that may not include things that make your life easier or more comfortable, like handrails in the bathroom.
Fortunately, Critical Illness Insurance pays you a lump-sum benefit payment upon verified diagnosis. And you can use it towards anything you want, such as the purchase of DME medical insurance may not cover.
6. Living expenses
Medical insurance may not pay for rent, utilities, groceries, childcare, transportation—or any of the other living expenses that you may need help with during an illness.
Household expenses could get even more costly when you’re ill. For instance, you may need someone to help you run errands, shop for groceries, and cook, if you’re unable to be as active as usual.
The lump-sum benefit payment you receive from Critical Illness Insurance could give you the ability to hire the help you need and pay for items such as living expenses.
7. Travel expenses
If you need to go out of town to see a doctor or participate in a clinical trial, medical insurance might not cover that—meaning flights, gasoline, food, lodging, and other costs would fall on you.
One solution: Use your lump-sum benefit payment from Critical Illness Insurance to cover travel expenses for yourself and family members. That way, you can focus on recovering, instead of how you'll pay for it.
Interested in learning more about Critical Illness Insurance? Talk to your employer about your plan options. And take our quiz to see what other insurance products might be right for you.