What Is Supplemental Health Insurance?
 Written by Derek San Filippo Derek San FilippoDerek has written 100+ articles on property & casualty, health and life insurance topics as an insurance expert for Smar... Read more |  Edited by Dan MarticioDan MarticioDan Marticio is the content manager at SmartFinancial and has written 150+ articles across multiple insurance verticals.... Read more |
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Supplemental health insurance is an additional policy that covers medical expenses that your main policy does not cover. Dental and vision insurance are common examples of supplemental insurance, as they add benefits that are often unavailable in a standard marketplace health plan.
Learn about the different types of supplemental health insurance as well as how you can get coverage.
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Key Takeaways
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What Is Supplemental Health Insurance?
Supplemental health insurance is a type of coverage that you can purchase to help you pay for medical expenses that are not covered by your primary health insurance plan. This can include out-of-pocket expenses like copayments, deductibles and coinsurance, as well as services like dental, vision or hearing services.
How Does Supplemental Health Insurance Work?
The Affordable Care Act (ACA) requires plans to cover a set of minimum essential benefits, including emergency services, hospitalization and preventive services. However, it doesn't mandate coverage for services like dental and vision care for adults. Dental and vision insurance plans are types of supplemental policies that can plug these coverage gaps.
In addition, you can buy supplemental health insurance to cover costs that exceed the limits of your primary plan. For example, if you’re hospitalized and your stay duration exceeds what your primary plan will cover, hospital indemnity insurance can pay toward the remaining bill.
It should also be noted that supplemental health insurance may even pay toward your out-of-pocket costs, with Medigap being a prime example. As a form of Medicare supplemental health insurance, Medigap policies are sold by private companies and can pay for your copays or coinsurance for services such as hospice care and skilled nursing care.
What Does Supplemental Health Insurance Cover?
Supplemental health insurance policies provide highly targeted coverage unlike the wide coverage scope a standard ACA plan provides, so what will be covered largely depends on the type of policy you buy. Below you can see a list of different plans so you can compare insurance.
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Insurance Type |
Description |
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Offers a payout in case of death or loss of limbs/sight due to sudden accidents |
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Short-term disability |
Can cover a portion of the insured's salary if they're temporarily unable to work |
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Long-term disability |
Provides 50% to 80% of your prior earnings if disabled for an extended period[1] |
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Offers lump-sum payment in case of a specific serious illness such as heart attack or stroke |
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Hospital indemnity |
Provides a fixed daily or weekly payment during hospital stays |
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Helps cover the cost of dental care procedures, such as teeth cleanings |
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Vision insurance |
Reduces costs associated with eye care, such as exams, lenses and frames |
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Fixed indemnity |
Pays a set amount per period or incident, regardless of actual medical costs |
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Medicare supplement (Medigap) |
Supplements Original Medicare by covering out-of-pocket costs |
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Complements primary health insurance to cover additional costs after primary care has been used |
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Cancer insurance |
Provides financial coverage for cancer treatment and associated expenses |
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Life insurance |
Pays a sum to a designated beneficiary upon the insured's death |
What Isn’t Covered?
Supplemental insurance provides very specific forms of coverage and as a result, there will always be exclusions based on what type of policy you buy. For example, Medigap is a type of supplemental insurance product that pays only toward out-of-pocket costs for Medicare beneficiaries, such as copays and coinsurance and not much outside of that. Similarly, dental and vision insurance will not cover any expenses unless they involve your mouth or eyes respectively.
That said, with the exception of Medigap and regardless of what type of supplemental policy you buy, your out-of-pocket expenses are usually excluded from coverage and you will be responsible for paying for your copays, coinsurance and deductibles whenever you see a healthcare provider.
How Much Does Supplemental Health Insurance Cost?
What you pay for supplemental health insurance is going to vary based on the type of coverage you purchase, as well as where you live, possibly your age, if there are dependants and the provider you get coverage through. For instance, you could spend as little as $5 per month for vision insurance or a monthly fee of $20 for accident insurance.[2][3]
Who Should Buy Supplemental Health Insurance?
The best supplemental health insurance and whether you need it in the first place will depend on your individual health needs, financial situation and the coverage gaps in your primary health insurance plan. For instance:
- Accidental death & dismemberment insurance: Best for individuals with risky jobs or lifestyles.
- Short-term disability insurance: Ideal for workers who lack an emergency fund and require income protection in case of a temporary inability to work due to illness or injury.
- Critical illness insurance: Suitable for individuals with a family history of serious illnesses like heart attack, stroke or cancer.
- Vision insurance: Ideal for those needing glasses or contact lenses, or who have a history of vision issues.
How To Get Supplemental Health Insurance
There are a couple of primary routes you can take when looking to obtain additional health insurance coverage. One option is to explore the benefits your workplace may offer. Many employers include supplemental insurance in their benefits packages, which often cover extras such as critical illness, accident insurance, dental and vision, providing an added layer of financial protection.
Alternatively, you can approach insurance providers directly. Companies like Aflac, MetLife and Mutual of Omaha specialize in a variety of supplemental health insurance policies. By reaching out to them, you can delve into the specifics of different plans and select one that aligns with your healthcare needs and financial circumstances. Whether you choose to coordinate with your employer or contact insurers yourself, both paths can lead to securing the extra coverage that suits your situation.
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Derek has written 100+ articles on property & casualty, health and life insurance topics as an insurance expert for SmartFinancial. Within his decade-long career writing about finances, entertainment, religion and philosophy, Derek spent three years writing financial articles for credit unions throughout the U.S. He prides himself on his ability to translate complex topics into actionable tips for everyday people.
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