Gap Health Insurance
Supplemental insurance to help fill the gaps in your major medical plan
Individual Marketplace major medical deductibles in 2020 range from $1,519 (Gold plan) to $6,506 (Bronze plan).[1]
Do you have enough money (or funds in a health savings account) to meet your annual major medical deductible if you have a covered accident or critical illness? If not, think gap health insurance.
For example, gap insurance can include critical illness + accident insurance coverage that provides a fixed lump-sum benefit as a result of a covered critical illness. This lump-sum payment can be used any way you see fit. Accident coverage is available for covered expenses incurred, up to a maximum benefit limit, whichever is less.
What Does Gap Health Insurance Cover?
Individual medical gap plans vary in what they cover, so you’ll want to read the details of any plan you’re considering closely. The coverages listed below are examples that are commonly part of many gap health plans.
What Gap May Cover
Broken bones
Life-threatening cancer
Heart attack
Kidney failure
Stroke
Coma
Coronary bypass
Loss of sight, speech or hearing
Major organ transplant
Paralysis
Severe burn
What Gap May Not Cover
Preventive care such as routine physicals
Any non-medically necessary or experimental procedures
Injuries or illness related to participating in extreme or dangerous activities (rock climbing, skydiving, private aviation, etc.) or sustained at work or under the influence of drugs or alcohol
Medical expenses incurred prior to the policy effective date or after the expiration date
Pros and Cons of Gap Health Insurance
- You choose how to use benefits payments – There is no restriction on how to use the money you receive, whether for medical costs or to pay for groceries.
- Apply year-round – There is no official open enrollment period and, in most cases, coverage begins the next day after you enroll online.
- A plan for every budget – There are different levels of coverage to meet different needs.
- Keep your doctor – No provider network limitations for fixed indemnity plans means you can visit your preferred healthcare provider.
- Unlike ACA plans, premiums are based on age and health – The younger and healthier you are the lower your monthly premium, conversely, older and sicker individuals will pay more.
- Pre-existing conditions are not covered
- Not ACA-qualifying major medical coverage – Gap insurance is a form of supplemental health insurance, not ACA-qualifying major medical coverage.
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Who Should Get a Gap Health Plan
A gap plan may be a good option for you if you:
Are you stuck with a high deductible health plan, wondering how to pay for your deductible should you need to use your insurance?
Medical Gap can help by paying a lump sum benefit that can be used towards your HDHP deductible.
Learn moreHow Gap Health Insurance Works
Here are a couple of examples to help illustrate how gap health insurance works:
- If you have a covered $30,000 cancer expense, your $10,000 maximum gap plan benefit will pay out in full and the policy will be exhausted.
- If you break your arm and it costs $3,000 to set it, your gap plan will pay $3,000. If you incur another injury or illness that costs $8,000, you will only be able to collect $7,000, or the remaining balance for the policy.
You pay monthly premiums in order to maintain your gap health plan and receive coverage for eligible events.
Present your insurance card when you receive medical care. The insurance company receives your bill and pays you a lump-sum benefit based on the covered services provided.
Your medical gap insurance does not coordinate benefits with any other health insurance you carry. If you’re using a gap plan alongside a major medical plan, your major medical policy also processes payments to the healthcare provider as usual and bills you for your coinsurance and deductible amounts (which you can then use your gap benefits to pay for if you choose to).
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How Much Does Gap Insurance Cost?
Gap medical premiums are typically affordable.
For example, a 46-year-old woman in Phoenix, Arizona, can get a mid-level gap plan for $27.82 per month.[2]
And with different benefit amounts to choose from, you can customize a plan that fits your budget.
It’s important to read and understand the coverages and benefits included in any plans you’re considering in order to know if the plan makes sense for you and your budget.
Find out how much it will cost you each month to close your deductible gap.
2 Ways to Get Started with a Gap Health Insurance Plan
Save on Healthcare Costs – Learn More at Our Blog
Footnotes
- [1] Average Health Insurance Costs for 2017. (Feb. 2017). Peoplekeep.com. Retrieved 4 February 2020, from https://www.peoplekeep.com/blog/affordable-care-act-policy-costs-up-in-2017
- [2] Health eDeals Marketplace Quote, 8/9/2018.
