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Supplemental health insurance + your existing coverage

Unexpected illnesses or frequent doctor visits can come with an overwhelming price tag and uncertain insurance coverage. Supplemental insurance may be able to help. Here’s how it works with primary coverage.

Woman in cast reviewing supplemental health insurance paperwork on phone

Worried about medical bills that might come your way? You're not alone. In a 2018 study by the Kaiser Family Foundation, almost 7 in 10 insured Americans said they were somewhat or very worried about being able to afford unexpected medical bills.

Their concerns aren't unfounded: Almost one in six insured Americans reported being surprised by a medical bill after a hospital treatment in 2017, and 16 percent of inpatient stays left a patient with at least one out-of-network charge — often from out-of-network doctors offering treatment at the patient's in-network hospital.

Beyond that, many health insurance policies include deductibles and copays that quickly add up in the event of a major illness or event. One option to consider: supplemental health insurance, sometimes called secondary health insurance. Here’s how it works with your existing coverage.

Supplemental insurance as a complement to current coverage

Put simply, supplemental health insurance is a policy that helps pay for costs and services that your regular health insurance plan doesn't cover. Supplemental health insurance can also help you and your family pay for extra costs such as deductibles, coinsurance amounts, private room and private-duty nurse fees, extra transportation, lodging, meals and unexpected child care associated with hospital stays.

Start with a policy review

As you think about supplemental insurance, begin by reviewing your current policies, including policies that cover partners/spouses and children. The key is to make sure that you’re complementing — not duplicating — your primary health insurance.

Medicare plus supplemental health insurance

If you're 65 or older and choose Original Medicare (now known as Medicare Parts A, B and D), you'll pay an out-of-pocket deductible for healthcare supplies and services. After meeting it, you'll typically pay 20 percent of the Medicare-approved amount for doctor services, outpatient therapy and durable medical equipment — and there's no limit on what you pay out of pocket every year. So supplemental insurance in the form of a Medicare Supplement plan can add support to complement that existing coverage.

A changing health insurance landscape includes Medigap

For past generations, employers and unions often sponsored retirement health benefits that filled gaps and capped out-of-pocket spending. But that practice has dropped significantly. Now many enrollees opt for Medicare Supplement Insurance, also known as Medigap, which is offered by licensed private carriers and helps pay some of the costs Original Medicare doesn't cover.

These costs can include:

  • An additional 365 days of hospital costs after the lifetime limit on Part A coverage is reached
  • Part A coinsurance and deductibles
  • Part B coinsurance (20 percent of most services you receive) and deductibles
  • A doctor who charges more than Medicare agrees to pay
  • Hospice coinsurance
  • Skilled nursing facility coinsurance
  • Emergency care in a foreign country
  • Blood transfusions

Not connected with or endorsed by the U. S. government or the federal Medicare program.

The information in this article was obtained from various sources not associated with State Farm® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. State Farm makes no guarantees of results from use of this information.

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