I have Medicare – Do I need Critical Illness Insurance?

Critical Illness coverage is specialized insurance that provides a lump-sum, tax-free payment should the insured suffer from certain specific critical conditions. These plans pay in addition to Medicare, Medicare Supplement insurance and other health insurance plans.

The three primary critical illnesses are: cancer, heart attack and stroke.

Critical illness insurance policies may also cover such conditions as:

Heart transplant
Coronary bypass surgery
Angioplasty
Kidney (Renal) failure
Major organ transplant
Paralysis

According to the American Cancer Society, one in two men will be diagnosed at some point in their lives with cancer. Among women, the probability is one in three. Cancer patients paid out almost $4 billion in costs out of pocket for cancer treatment in 2014, according to the American Cancer Action Network.

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Please note that critical insurance is not designed to replace your Medicare coverage, rather provide extra cash when you may need it most. However, it can be a very important part of your overall financial plan! It can help you and your family cover unexpected costs that your medical insurance, and Medicare may not cover.

According to a study in JAMA Oncology, Medicare patients who do not have supplemental insurance, such a Medicare Supplement (Medigap Plan) will spend 60 percent of their income on cancer related expenses. Unfortunately, Medicare does not set a limit on out-of-pocket costs for patients, and these can easily reach over $10,000 a year; new cancer drugs are commonly priced at $100,000 per year.

How Plans Pay

Benefits are paid as a single, lump sum payment as soon as the individual is diagnosed with a covered condition.

Some policies will actually provide multiple cash payments. Say you have cancer and survive; you get a cash payment. Three years later, you have a heart attack; another payment. But this varies from insurer to insurer, so be sure to ask if it applies.

The is a key difference between major medical insurance, to include Medicare, and a critical illness insurance plan. Your major medical insurance plan, Medicare and a Medigap plan will pay your hospital, doctor, lab fees, durable medical equipment and, if you choose this coverage, prescription drugs. Your critical illness insurance policy pays you.

These benefit payments are paid out directly, which means the patient (insured) can use these cash benefits how they choose. Cancer patients are, unfortunately, frequently faced with immediate and heavy cash needs.

Why Would I Need Critical Illness Insurance Benefits ?

• Cash to pay for medical treatments not covered by your health plan, Medicare, etc.
• Money to pay your mortgage while you are recovering.
• Cash to pay bills – from car payments to insurance premiums- such as your Medicare and Medigap premiums.
• Money so you can travel for treatments not available locally.
• Cash to pay for experimental treatments (not covered).
• Money to replace a spouse’s income while caring for the insured.

We think you’ll find a way to put the cash to good use.

If you’re on Medicare, or soon to be eligible for Medicare, you may also consider a Medicare supplement or Medicare Advantage policy. This can also help provide a cushion against these deductibles and co-insurance payments.

Alternatives

Critical Illness insurance isn’t for everyone. It’s best for those who have family history or other reasons to believe they have an elevated risk. In other situations, a combination of disability insurance, Medicare supplement insurance, and private savings will provide sufficient protection.

You can get a critical illness policy that just covers cancer, which is really just a ‘Cancer’ plan. However, you may also consider broader critical illness insurance coverage that will pay benefits not just for cancer but also for other major medical events, like strokes, heart attacks, amyotrophic lateral sclerosis (Lou Gehrig’s Disease) and more.

Contact

To learn more about cancer insurance and other forms of critical illness insurance, and how it fits in with your Medicare coverage or other health insurance, give us a call today. Call us directly by dialing 888-901-4870  or simply use this online contact form and we’ll get back to you promptly! As usual, there’s never any fee for our services!

But don’t delay! These cancer and critical illness policies are medically underwritten. Unlike major medical plans under the Affordable Care Act, insurance companies can and do discriminate against applicants who have pre-existing conditions. It’s important to shop for and purchase cancer and critical illness insurance while you are still healthy.