Secondary health insurance can help pay out-of-pocket costs

A health insurance policy doesn’t typically cover all your medical expenses, but secondary health insurance can help you pay your health care bills. 

A study by the Commonwealth Fund found that medical expenses, such as copayments, out-of-network bills and high deductibles, “leave many Americans facing very high out-of-pocket costs.”

Consider this — many health insurance policies don’t cover dental visits. A root canal can cost as much as $1,500 (and higher when performed by an endodontist), which you’ll need to pay yourself. 

Meanwhile, hearing aids and eye exams aren’t included in Medicare, but a supplemental plan could help.

What is secondary health insurance?

Secondary insurance, also known as supplemental insurance, is a type of coverage that can help you pay costs your primary health insurance doesn’t cover. Supplemental coverage complements your main health insurance.

A spouse’s employer-sponsored healthcare plan or any additional insurance you purchase can be considered supplemental. When you have more than one type of medical coverage, one will be the primary. The other will be the secondary insurance that kicks in if your main insurance doesn’t cover the expense.

Types of secondary health insurance

Supplemental health insurance fills a coverage gap and there are a variety of types of secondary health insurance. As mentioned, a spouse’s or partner’s health insurance could be considered supplemental. 

Other types of secondary insurance include:

• Dental
• Vision
• Hearing
• Medicare supplement insurance (Medigap)
• Hospital indemnity
• Disability
• Long-term care

What does secondary health insurance cover?

Secondary health insurance covers things your primary insurance won’t cover. It all depends on how likely you’ll think you need the additional coverage. 

For example, most people don’t need extra hearing coverage. But if your family has a history of hearing problems, you may need to visit specialists more often and/or get fitted for hearing aids. In that case, adding a hearing plan as secondary insurance could be a smart financial move. 

Here’s a closer look at the types of secondary insurance and what they cover.

Vision, hearing and dental insurance

These three types of insurance are the most common types of additional coverage. 

You may want to consider adding the extra coverage since most standard health insurance policies and Medicare don’t include a visit to a dentist or vision exams and eyeglasses.

Medigap — Medicare secondary insurance

Original Medicare, which is Parts A and B, doesn’t cover all health care costs. You’ll have to pay coinsurance and deductibles. Medigap can be added to Original Medicare to pick up where Medicare leaves off.

Medicare Part A pays for services from in-patient hospitals, skilled nursing facilities, home care and hospice care. It charges you a fixed amount of coinsurance per day after a certain period. 

Medicare Part B covers doctors’ visits, durable medical equipment and outpatient hospital care. It works by paying up to 80% of a qualifying bill and paying the remaining 20% out-of-pocket.

Medigap isn’t health insurance. It doesn’t add new coverage but simply pays for some or all of the costs that the Medicare plans expect you to cover out-of-pocket. 

You could also purchase Part D prescription drug coverage to add secondary coverage to your Original Medicare plan.

Hospital indemnity

Adding hospital indemnity is a great choice if you have a high-deductible health plan. If you’re hospitalized, you’ll receive a check from your insurer to use toward your hospital bills and anything related, such as making up for lost wages.

Disability

Similar to a hospital indemnity plan, disability insurance covers lost income if you’re out of work due to a medical issue. You typically receive a percentage of your income, such as 60-80%, to help with the bills while you recover.

Long-term care

If your health condition is chronic or something you won’t recover from, long-term care insurance will pay for the expense of care at a special facility or skilled help in your own home. 

Older adults often need long-term care, especially if they’re suffering from medical conditions, such as Parkinson’s or Alzheimer’s.

Secondary insurance for pregnancy

Maternity care is considered an essential health benefit, so Affordable Care Act marketplace plans must include medical care coverage for a pregnant mother and her newborn.

In most states, uninsured pregnant women are eligible for Medicaid coverage. Depending on the state’s eligibility criteria, a pregnant woman may qualify for full-scope Medicaid enrollment or pregnancy-related coverage.

Although pregnancies are covered through Medicaid or the marketplace, the plans don’t cover lost wages. And, in some cases, you may have to pay a percentage of the labor and delivery bills. Secondary insurance for pregnancy coverage can help with the extra financial burden. 

Some types of supplemental maternity coverage include:

• Hospital indemnity coverage: Pays your labor and delivery hospital bills if you don’t have health insurance coverage
• Short-term disability coverage: Supplements your income during the time you’re unable to work after childbirth (maternity leave)

You can coordinate coverages if both you and your partner have health insurance through work. Health insurers’ coordination of benefits decides which plan pays first and which one pays second.

How does secondary insurance work with deductibles?

A supplemental insurance plan typically comes with a deductible. You’ll need to pay the deductible before your plan steps in to assist financially.

One of the pitfalls of carrying two health insurance policies is having to pay a deductible on your primary and secondary health insurance. Be sure you can afford the second deductible. 

On the other hand, you can set up supplemental insurance to reimburse your primary plan’s deductible.

Secondary health insurance plans

Your current health insurance company may provide additional types of medical insurance. Other companies that provide secondary health insurance include:

• Aetna
• Cigna
• Humana
• State Farm
• United Healthcare

Is secondary health insurance worth the cost?

Secondary insurance may be worth the expense if you have chronic health issues or worry about being out of work for a long period. Besides the cost, ask yourself these questions to decide if additional coverage is a good choice for you:

• What type of medical care or services will secondary coverage provide?
• How often do you expect to use the supplemental insurance?
• Is your family genetically predisposed to certain conditions, such as hearing loss, eyesight problems or Alzheimer’s disease?
• Can you afford the deductible?
• Can you take advantage of a spouse’s health coverage instead of buying additional insurance?

Take your time to research the additional costs and benefits of secondary insurance to make the right choice. In most cases, secondary coverage is affordable and could save you in out-of-pocket expenses over the long run.

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