Cancer. The word itself is daunting enough. It’s something that you think would never happen to you, but there are over 120 forms of cancer, each with their own extensive list of risk factors. If you’re anything like me, you might not have known that Cancer Insurance exists. It got me thinking: if I didn’t know cancer insurance existed, how many other people don’t know that it exists? It sounds straight forward: Cancer Insurance is for people with cancer or who are at risk of cancer. If only all insurance were that simple!
The simple definition of Cancer Insurance is it’s a policy that helps pay toward treatment, transportation, lodging, and more. It’s also a form of supplemental insurance, which means you can use it in conjunction with other forms of insurance such as medical and critical illness. Like most insurance policies, there is confusing jargon associated with Cancer Insurance that make fully understanding your plan difficult. Let me explain a few terms you might’ve seen in your Cancer Insurance plan that might have you scratching your head.
#1
Pre-Existing Condition
Before I give a brief overview on what a pre-existing condition clause is, it’s important to note that there are varying definitions. The exact policy definition and terms depend on your carrier, so be sure to carefully read that information in your plan. The best way I can explain what a pre-existing condition is that it’s a health issue that you had prior to the date of coverage of your plan. Regarding Cancer Insurance, having a prior cancer diagnosis or receiving treatments can be considered a pre-existing condition. Even if you are in remission, it is still considered a pre-existing condition. This does not mean that you are completely ineligible from receiving the benefits, but it can mean that you will not receive the benefits until 12 months after your enrollment date. Again, the number of months until you start to receive the benefits for Cancer Insurance may vary. Because of the pre-existing condition clause, it’s imperative that you are aware of your family history and visit your doctor regularly to qualify for the benefit as soon as you receive a positive cancer diagnosis.
#2
Coinsurance
This is another term where the exact numbers vary depending on your policy. Coinsurance takes care of major things that come with cancer such as chemotherapy, radiation, and diagnostic testing. Coinsurance kicks in once you meet your deductible. When enrolling in a plan, it’s important to remember that plans with a lower monthly premium have higher coinsurance, while plans with a higher monthly premium have lower coinsurance.
#3
Indemnity vs. Reimbursement
There are two different ways to receive your monetary benefits with Cancer Insurance. One method is indemnity and the other is reimbursement. The simplest definition of indemnity is that your payment is up front. An indemnity policy pays for your scheduled benefits as soon you qualify under the claim, regardless of the out-of-pocket costs. No bills or receipts are required to receive the payment, which allows for flexibility to pay for costs that accumulate while you have cancer.
On the other hand, reimbursement requires that you provide bills or receipts to your insurance company to get your benefit paid out. The bills must be for qualified expenses, and there is typically a monthly maximum. If you don’t meet your monthly maximum, most insurance companies will allow you to carry over the remaining amount. For example, if your monthly maximum is $5,000 but you only spent $4,000 on cancer treatment this month, your $4,000 will be reimbursed but you will not receive the other $1,000. The remaining dollar amount will be available to you during the next benefit period. Costs that are typically covered by both models of reimbursement include chemotherapy, radiation, hospital stays, immunotherapy, testing, and much more.
Between medication and travelling far to go to the best facility for your treatment, the cost of cancer can be overwhelming. In fact, 71% of cancer patients are more likely to have outstanding debts and face mortgage foreclosure than Americans without cancer.1 When you have cancer, the most important aspect to focus on is yourself and your health, not the insurmountable pile of bills accumulating. Now that I’ve broken down some confusing jargon that is in your policy, you’ll be able to reread your policy and understand the specific clauses. I’m happy to have shared another way in which insurance doesn’t have to be so complicated.
1: Levey ,Noam (July 9,2022). “She was already battling cancer. Then she had to fight the bill collectors”. NPR. https://www.npr.org/sections/health-shots/2022/07/09/1110370391/cost-cancer-treatment-medical-debt
