Hospital Indemnity

Hospital indemnity insurance is easily one of the easiest cross-selling opportunities for Medicare Advantage agents. Medicare provides great benefits but still has many gaps in its coverage, and even most Medicare Advantage plans will not cover the first few days of hospitalization. 

This means many Medicare recipients may be looking for additional supplemental insurance, and a hospital indemnity plan can help fill in these coverage gaps by paying a cash benefit directly to the beneficiary.

Cancer insurance is another type of supplemental insurance plan that can help pay for costs related to cancer treatment that are not covered by primary health insurance. There are some similarities between cancer plans and hospital indemnity plans, but they are distinctly different in many ways.

For example, both types of insurance pay their cash benefits directly to the beneficiary. But with hospital indemnity insurance, beneficiaries receive a set amount for every day they are confined in a hospital, whereas cancer insurance benefits are usually paid in a lump sum upon diagnosis.

Additionally, most cancer plans will also require a long period of being cancer-free before enrolling, sometimes up to 10 years. Hospital indemnity plans with a Cancer Rider usually have a much shorter requirement period of around 3 to 5 years.

In general, hospital indemnity plans will cover the cost of a hospital stay and other inpatient hospital services, including surgery or ICU confinement. But depending on their choice of plan and riders, a policyholder can be covered for a wide range of other services, including but not limited to:

• Continuous care
• Emergency room visit
• Ambulance transportation
• Skilled nursing facility visit
• Chemotherapy, radiation, and other cancer treatments
• Costs of a hospital indemnity plan

Hospital indemnity insurance is extremely affordable while still covering many out-of-pocket costs. Some basic plans can cost as little as $5 a month. The actual monthly premium will vary based on several factors like:

• Plan choice
• Beneficiary age
• Beneficiary gender
• Tobacco use

For just a little extra money every month, hospital indemnity beneficiaries can be assured they’ll be covered when it comes time for co-pays, out of pocket expenses, and other medical costs accrued during a hospital stay.

If you’re already selling Medicare Advantage, you have the perfect opportunity to start selling hospital indemnity insurance. The coverage gaps inherent to Medicare provide a great way to introduce hospital indemnity insurance to your client.

As you explain the details of each Medicare Advantage plan during your sales presentation, be upfront about the coverage gaps of each option. Then explain to your client how hospital indemnity insurance can help pay for the out-of-pocket expenses and copays not covered in their chosen plan.

If you already have existing Medicare Advantage clients in your book of business, offer to check in with them to address any questions or concerns. During this check-in, try introducing hospital indemnity and other ancillary products to address gaps in their coverage. 

When you bring up hospital indemnity insurance, your new or existing clients may ask, “Is hospital indemnity worth getting?” The answer in many cases is “Yes!” 

Hospital indemnity policies can be sold to people of any age, and are a great option for any individuals or families who are concerned about high copays and out-of-pocket costs. There are a lot of other factors that can make hospital indemnity insurance worth it for your clients, such as:

• If they are worried about lost wages while confined to the hospital.
• If they have a child or other family member that is prone to injury or illness.
• If they have health insurance with a limited network.
• If they own a small business and want to offer an additional benefit to employees.
• If they have a high deductible health plan.
• Selling hospital indemnity coverage to Medicare clients

Hospital indemnity insurance can also be helpful for Medicare eligibles and beneficiaries, especially those who may be on a fixed income. Even enrollees with $0 premium Medicare Advantage plans likely struggle with high deductibles and copays. A hospital indemnity plan could be the perfect way for them to fill in their coverage gaps for an affordable price.

If you’ve been successful as an MA producer, you may wonder “Is selling hospital indemnity with Medicare Advantage worth it?” Absolutely! Hospital indemnity is an ideal cross-selling opportunity for Medicare Advantage agents and can bring in as much as double the commission for each plan you write.