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How to choose supplemental health insurance that’s right for you

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Learn key insurance terms and how to use them to choose the right supplemental health insurance policy for your needs

If you’re like most people, you need a strong health insurance plan — and possibly also supplemental insurance plan — to protect you from high, out-of-pocket medical costs. But deciding the best supplemental health policies for your needs out of myriad of options can be difficult. That’s why we’ve broken down what you need to learn about policies, insurance riders, out-of-pocket costs, and more to help you make an educated decision.

How do I get started?

First, you’ll need to familiarize yourself with industry jargon. You can study our glossary of insurance terms, but you can also keep these important items in mind:

  • Benefit maximum: This is the most an insurance provider will provide for your health care benefits in a year or over a lifetime.
  • Deductibles: These are required amounts you pay for health care services or prescription drugs before insurance payments begin.
  • Premium: This is the dollar amount you pay to the insurance company on a regular basis for coverage.
  • Coinsurance: This is the dollar amount, often shown as a percentage of the total medical service, that you are responsible for paying the health care provider after you’ve paid the plan’s deductible.
  • Copay: An amount you pay each time you use a medical service, such as a doctor’s office visit.

What is included in a supplemental health insurance policy?

When deciding how to choose supplemental health insurance, you should think about what types of needs you have. Ask yourself:

  • Do I need a plan that covers prescriptions because I take more than one drug on a regular basis?
  • Do I have a chronic condition that requires regular care?
  • Do I have risk factors to develop a chronic condition?
  • Do you have enough coverage if you experienced an unexpected illness or injury?

A lot of supplemental insurance plans cover only certain benefits on the base coverage, then insurance companies give customers multiple options of riders, or add-ons, that customers can elect to include with their base coverage.

Here’s a checklist for how to choose the right supplemental health insurance policy:

  • Decide if you want a high deductible vs. low deductible
  • Check the coinsurance amount
  • Determine the out-of-pocket maximum
  • Look at covered and non-covered services and riders
  • Include the premium when accounting for the plan’s annual expenses

Ultimately, anticipate what you think you might need covered and consider what you can afford. Then think about what you can handle financially if something catastrophic happens and you’re financially responsible for the cost of your medical care.

How do I choose between high deductible vs. low deductible?

What your insurance covers varies, depending on if you select high deductible vs. low deductible plans. High deductible plans are better for those that are just looking for catastrophic coverage. Low deductible plans typically have higher premiums, but benefits kick in a lot sooner.

Here’s how to choose supplemental health insurance based on deductibles and your situation:

  • High deductible: You’re generally healthy, have limited medical costs, and are looking for protection if something major were to happen, like a trip to the emergency room due to an accident or being confined to a hospital for more than a couple of days. You’re okay with a bit of risk — because you may have to pay more out-of-pocket costs to hit your deductible level.
  • Low deductible: You anticipate higher medical costs and more doctor visits. You’re risk averse, and/or would like to avoid a lot of up-front, out-of-pocket costs.

What are out-of-pocket costs?

Out-of-pocket costs are what you pay as a patient for medical care. Each plan has an out-of-pocket maximum, which is the largest dollar amount you might pay in a plan year for covered medical services, including copays, coinsurance, and deductibles, but excluding monthly premiums.

What is an insurance rider, and how does it affect my supplemental health insurance plan?

Insurance riders are defined as insurance policy amendments to add or exclude coverage for a body part, body system, or health condition. They can provide additional coverage or restrict or limit coverage.

Insurance rider options can include a variety of options — from types of extended care, such as home health care or nursing home care, to inflation protection. Be sure to consider your current circumstances and the rider options available as you ponder how to choose the right supplemental health insurance policy.

What type of supplemental health insurance should I choose?

If you determine your primary health insurance won’t cover all your needs, you can choose a supplemental insurance to fill the gaps. Wellabe offers a variety of supplemental plans:

Hospital Indemnity insurance

This plan is supplemental hospital insurance that pays you a cash benefit if you're hospitalized. In addition to its base coverage of inpatient hospitalization or observation unit monitoring, emergency room service, and inpatient mental health services, it also offers optional riders that include some outpatient benefits, like rehab and surgical centers, ambulance services, skilled nursing facility care, and a lump sum for a cancer diagnosis. 

Learn more about Hospital Indemnity insurance >

Medicare Supplement insurance

This plan helps bridge the gap between what Medicare pays and your out-of-pocket costs. Wellabe offers Plans A, F, High-deductible F, G, and N, and a basic benefit plan with optional riders in Wisconsin. 

Learn more about Medicare Supplement insurance >

Dental insurance

Medicare doesn’t include dental coverage, but our Gold and Platinum plans can help you with dental health costs. You can also score extra savings if you use an in-network dental provider from our network, which focuses on neighborhood dentists and is one of the largest in the United States. 

Learn more about Dental insurance >

Short-term Care insurance

If you’re between the ages of 40 and 89, you can apply for Wellabe’s Short-term Care insurance, which offers coverage for extended care — both medical and non-medical — in your home or in a facility. You select a daily benefit amount per day for up to 360 days. Your plan pays you a full cash benefit for each day you receive care. 

Learn more about Short-term Care insurance >

First Diagnosis Cancer insurance

If you're between 18 and 79 years old, Wellabe’s First Diagnosis Cancer plan can help if you’re diagnosed with internal cancer or malignant melanoma. It’s a one-time benefit that is paid directly to you. 

Learn more about First Diagnosis Cancer insurance >

Photo credit: iStock

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Wellabe offers life and supplemental health insurance plans to help you prepare for good days and bad. We’ll always be here to empower you to be well — well prepared, well protected, and well loved.