Hospital indemnity insurance

Hospital indemnity insurance is designed to help offset the rising costs of hospitalization. It is important to understand that when you are forced to spend time in the hospital, these medical expenses are not the only expenses that you incur. If you have a regular job, you may be out the money that you would typically earn while working for the entire time that you are in the hospital. Alternatively, mothers of young children may incur additional expenses such as daycare or housekeeping expenses due to being in the hospital. Hospital indemnity insurance helps people to get the additional money that they need to take care of these and other expenses during a hospital stay.

Hospital indemnity insurance plans provide benefits on a daily basis for each day that the insured is hospitalized. These benefits are paid directly to the insured and basically have no direct bearing on the amount of the hospital expenses in general. The benefits go into effect when you are hospitalized and pay you for every day that you must stay as an inpatient. Benefit amounts will vary from company to company. Some companies may pay $50 per day for hospitalization while others may pay up to $200 per day. The amount of your benefit will depend on the company that writes the policy as well as the policy itself. Most policies pay an extra amount for a specified number of hospital stays. For instance, if you are admitted to the hospital and stay for ten days, then you may receive an additional benefit amount, in some cases up to $1,000.

To understand how hospital indemnity insurance plans work, take this example. If you were to be admitted to the hospital for a total of 20 days and have a traditional major medical policy that covers 80 percent, with a $500 deductible then you could benefit from a hospital indemnity plan. Imagine that based on the above scenario, your total out of pocket expense for this hospital stay would be around $1,500. This is calculating your 20 percent deductible as well as coinsurance. If you have a hospital indemnity plan that pays $100 for every day of hospitalization, plus extra benefits for being hospitalized for more than 10 days, your total payout on your indemnity plan would be $2,000. This can help to offset the amount of money that you would pay out of your pocket. This check would be sent directly to you to use in any way that you see fit.

Hospital indemnity insurance is meant to be a supplement to more traditional coverage. Taking into consideration the rising costs of medical care today, you could not possibly pay for an entire hospital visit using this type of insurance. You could however, significantly cut down the amount of money that you would have to pay out of pocket for hospital stays, not to mention the other daily living expenses that are incurred.

Hospital indemnity insurance can be purchased through a variety of insurance companies. There are several options with regards to benefits and premiums as well as terms, so choosing the right one for your individual needs may seem confusing. It is important to research the different benefits and choose the one that you can best afford and that offers you the best benefit amount in accordance to your individual needs.

You should note that there are some indemnity policies that place limitations on pre-existing medical conditions. Other policies have elimination periods that cap the benefits paid after a specified number of days in one hospital stay. Depending on the insurance company, you may be able to choose an elimination period. Many companies offer longer elimination periods for higher premiums. It is also important to regularly review your hospital indemnity insurance policy to meet with the rising costs of living and health care. If you find that you can afford to increase your policy frequently, it is an excellent idea to do so. This will help you to better afford hospitalization as daily living expenses and healthcare costs continue to rise.

Last updated on Dec 10th, 2010 and filed under Health Insurance. Both comments and pings are currently closed.

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