Is a Hospital Indemnity Plan right for your client?
Cash benefits are paid directly to the member to help cover the costs associated with hospital confinement, ambulance trips, skilled nursing stays, or household expenses while hospitalized. Hospital Indemnity Insurance benefits are payable no matter what other medical coverage the member may have.
Hospital stays can have a lot of costs associated that are non-medical and not covered by health insurance. Having the cash benefit can offset some of those costs and greatly reduce the out-of-pocket amount your clients will end up paying for things like transportation, a mortgage, meals for the spouse, lost time at work for the spouse, or prescription drug costs.
A hospital indemnity plan will help pay for out-of-pocket expenses associated with:
How much could your clients save with an HI Plan?
The average person on Medicare spends $5460 out of pocket per year, and hospital stays can have a lot of costs associated that are non-medical and not covered by health insurance. There are approximately 6 million hospital stays per year by people on Medicare with the average stay length of 5 days.
With these plans, you’re able to customize them for your customer. Hospital stays are often unexpected, and costs can add up very quickly. Having this cash benefit can offset some of those costs and greatly reduce the out-of-pocket amount your clients will end up paying.
Customize a plan for your clients
There are multiple optional add-on riders that you can include with your hospital indemnity plan depending on the client.
Optional add-on riders typically include:
These add-on riders serve as an extra layer of protection. Cancer is a very expensive disease to treat and it could happen to anyone- no one is immune. Help your client understand that they could trade pennies for dollars
How to introduce adding a HI Plan
A perfect time to bring up adding a Hospital indemnity plan is at the end of your Medicare Advantage plan appointment. These plans typically cover roughly 80% of costs, leaving 20% to be covered by your client out-of-pocket. Let them know that a HI plan can cover most or all of the difference, thus eliminating the potential risk of being on the Medicare Advantage plan.
When you help minimize risk and save your clients money, they will feel a stronger sense of loyalty and trust with you as their agent. It is important to give your clients peace of mind leaving their appointment. Make sure that your clients feel protected.
How to sell more HI Plans
Take advantage of the plans that offer Guaranteed Issue options at certain ages. There are no health questions and enrollment is an absolute breeze with these cases. If your client has been to the hospital in the past 12 months or has any conditions like diabetes, you need to enroll them during the Guaranteed Issue period. This may be their only chance to get a hospital indemnity plan.
Let your clients know about the cash benefit. This is a check that will be paid directly to your client after they have been discharged from the hospital. They will be paid a certain amount for each day that they were admitted to the hospital. Amounts depend on plan design.
Another bonus to selling Hospital Indemnity Plans is that you get paid weekly on these policies during AEP to help cover costs of doing business. This means no having to wait until January to put money in your pocket.
Here at Tidewater Management Group we have a multitude of carriers that offer hospital indemnity plans, some starting at age 18 and up. If you have any questions about hospital indemnity plans, please give us a call here at 888-622-9122.