In 2018, an estimated 1.7 million Americans were diagnosed with cancer. To put that in perspective, that’s about the population of Phoenix — so we’re talking a lot of people.
A cancer diagnosis changes everything about a person’s life. While the emotional trauma or physical effects usually come to mind first, those patients also have to deal with some level of financial blow, even if they’re well-insured. That’s because cancer is costly, in all the ways you probably expect and so many others you might not.
Critical Illness Insurance and Cancer Costs: What You Need to Know
Cancer costs follow patients throughout their care journey, from the first appointment through remission and recovery. Chemotherapy, radiation, surgery, medications — they all have hefty price tags. The costs go well beyond treatment alone, though, from imaging scans to unexpected expenses like emergency room visits if procedures don’t go as planned.
In one example from the American Cancer Society (ACS), a lung cancer diagnosis cost more than $210,000. Insurance can help pick up some of the tab, but if you’re a cancer patient, you generally have to meet a deductible and then pay coinsurance until you reach the out-of-pocket maximum — up to $7,900 for an individual, or $15,800 for a family. In January, the deductible likely resets, meaning you have to do it all over again.
Even beyond that, traditional health plans don’t cover every cost — if you need to see an out-of-network specialist or you require special equipment to help you through treatment, you might be on your own when it comes time to pay the bill. And throughout the whole ordeal, the world keeps spinning: Rent, groceries and utilities are still due, even if you don’t have the time or energy to work.
With all that, it’s no surprise that the financial effects linger long after the cancer is gone: The ACS found that 1 in 3 cancer survivors are left in debt, with more than half of them owing $10,000 or more. Even worse, many patients skip lifesaving treatments because they can’t afford them.
That’s where critical illness and hospital indemnity insurance can help in a big way. As supplemental plans that pay out fixed cash benefits for health issues like cancer — and any hospitalizations that result from it, whether they’re expected or not — the plans offer an extra layer of financial protection when patients need it most.
Surprise medical expenses can put your finances in flux, but supplemental insurance can help. Pick the perfect plan for you here.
How It Works: A Hypothetical Case Study
Say you’re a 32-year-old who noticed a growing mole on your arm while at the beach with your family. You didn’t think it was a big deal, but your partner urged you to go to the doctor and get it checked out.
After a biopsy, you learn you have cancer that has spread to the lymph nodes. The next 18 months are swallowed up by a series of chemo appointments, blood draws, scans and medications — all of which come with their fair share of costs.
By October, you reach your $2,500 deductible and coinsurance kicks in. By December, you finally hit your out-of-pocket maximum, but you’re only able to briefly enjoy that reprieve before New Year’s rolls around and the calendar — along with your deductible — resets. The costs carry on, and so does life: Car payments, groceries and mortgage payments build up. The only thing that doesn’t continue? Your job, which you had to quit in order to fit in all the appointments.
Without supplemental insurance, you’d pay those costs outright. But with a combination of supplemental plans such as hospital indemnity and critical illness insurance, you could expect a series of lump-sum payouts to absorb those costs significantly.
And it’s serious cash: If you have critical illness insurance and cancer, some plans pay a fixed benefit of as much as $20,000 or more for that diagnosis, while fixed indemnity plans provide payouts of up to $100 or more for each day of hospitalization. The benefits are yours to use as you need, whether you’d like to pay off a medical bill or just cover some of your rent.
Depending on your situation, those amounts may cover all of your costs, or at least a large portion of them. Either way, that cash can help minimize costs and safeguard against medical debt. When you’re dealing with the emotional trauma of a cancer diagnosis, the last thing you should have to worry about is how you’ll pay for it all.