What the Heck is Doctor and Hospital Fixed Indemnity Insurance?

May 19, 2017

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Doctor and Hospital Fixed Indemnity Insurance.

What the heck is it?

According to healthcare insurance company UnitedHealthCare: “A fixed indemnity plan sends you a preset—“fixed”—payment when you receive any of the qualified medical services specified in the plan. The money paid out stays the same no matter what the total bill for the qualified service was. That’s why fixed indemnity insurance can also be called fixed benefit insurance or fee for service insurance.”

Sounds super confusing right?

Don’t worry, we have our super smart KindHealth Advisor Sonia to break it down in real talk: 

Basically doctor and hospital fixed indemnity insurance pays a specific dollar amount for each covered service.

Here’s an example:
A 32-year-old woman in Travis County can get a $5,000 deductible plan that covers $60 per doctor visit and $1,000 a day for hospitalization for $75 a month.

The patient has 10 doctor visits and spends 10 days in the hospital:
10 doctor visits at $60 a/visit = $600
10 days in the hospital at $1000 a day = $10,000

Though the deductible is $5,000, the money you have paid towards your regular health insurance deductible can go towards this deductible.

Indemnity plans are usually considered supplemental rather than an alternative to major medical coverage because they will only pay the dollar amounts specified in the plan, and then the patient is responsible for the rest of the bill. In other words: they aren’t the best for anything catastrophic. However, they will pay on top of whatever another health plan would pay. For instance, if a person already has a major medical plan with copays for doctor visits and only has to pay a $40 copay for a doctor visit, the indemnity plan would still cut a check for the $100 benefit as long as all of the policy terms are satisfied.

Some indemnity plans will pay the healthcare providers directly for the service. All will cut the patient a check for the benefit amount if he or she wants to submit the claim directly.

If a doctor and hospital fixed indemnity insurance plan sounds like something you need, give us a call at (888) 871-3864.