But there’s another danger lurking out there that could be harder to overcome:
The medical bills.
Cancer patients are 2½ times more likely to declare bankruptcy as healthy people, with treatment costs average in the $150,000 range. One recent study placed the median cost for heart attack hospitalization at about $53,000 and strokes at $31,000. Now add onto those bills the additional expenses following hospitalization, including rehabilitation, therapy, ongoing medical care and drugs.
These kinds of bills are catastrophic for the uninsured — but even those with robust health insurance can face crippling expenses from copays, deductibles and nonmedical costs related to a serious illness, such as home adaptations or equipment, travel for treatment and lost income from missing work. Even plans that cap out-of-pocket costs can still leave families owing thousands of dollars. When you consider one in four adults would struggle to cover an unexpected expense of just $400, this kind of financial burden can be devastating.
How critical illness insurance helps
Critical illness insurance can help bridge the financial gap between what health insurance covers and out-of-pocket expenses. It complements major medical insurance by paying a lump sum — typically around $15,000, depending on the plan and covered condition — when the illness is diagnosed. Covered illnesses usually include heart attack, stroke, end-stage renal failure, coronary artery bypass surgery, major organ failure and sometimes cancer.
Benefits are paid directly to the insured to use however needed: for hospital or doctor’s bills, copayments and deductibles, or even daily living expenses such as mortgage payments, utility bills, meals and child care. The coverage doesn’t coordinate with other insurance, so the benefit amount isn’t reduced by what major medical or other coverage pays.
Insureds don’t even have to get sick to take advantage of their critical illness insurance. Many plans include a wellness benefit that pays a set amount — $50 is typical — for covered health screenings such as mammograms, colonoscopies or cholesterol screenings. These tests can help in early detection to help prevent more serious illnesses from developing.
Surviving a serious illness and surviving the financial burden it creates are different matters. Critical illness insurance is an affordable option that can help employees better protect their families, their finances and their futures.
Ashley Shope is an assistant vice president for product development at Unum.