Facing a cancer diagnosis brings many challenges, and understanding your health insurance is crucial. With rising healthcare costs for diagnosis, treatment, and ongoing care, knowing your insurance options is vital for your financial, physical, and mental well-being. As open enrollment approaches, it’s the perfect time to explore your choices and make informed decisions to manage potential expenses effectively.
This guide will clarify confusing insurance terms and explore your health insurance options as a cancer patient.
If you’re seeking a second opinion on your cancer diagnosis and treatment plan, please call us or chat online to connect with our expert team.
Key Health Insurance Terms Explained
Understanding health insurance terminology empowers you to make informed choices and fully grasp your benefits and potential costs. Here are some essential terms:
Deductible: This is the upfront amount you pay out-of-pocket for healthcare services before your insurance coverage starts contributing. For example, a $1,000 deductible means you pay the first $1,000 of healthcare costs before your plan begins to pay.
Premium: Your premium is the regular payment, often monthly, you make to maintain your health insurance coverage.
High Deductible Health Plan (HDHP): An HDHP is characterized by a higher deductible, meaning you pay more out-of-pocket initially. In 2023, a plan with a deductible of $1,600 or more for individuals and $3,200 for families is considered an HDHP. HDHPs often have lower monthly premiums, which might seem appealing if you anticipate minimal healthcare needs.
If you have an HDHP, you may qualify for a Health Savings Account (HSA), offering tax advantages and helping to offset healthcare expenses.
Out-of-Pocket Maximum: This is the absolute limit on what you’ll pay out-of-pocket annually for deductibles, co-pays, and co-insurance. Once you reach this maximum, your health insurance covers 100% of eligible costs for covered services, medications, and benefits.
This figure is critical for financial planning. Be aware that out-of-network services or non-covered drugs might not count toward this maximum or be covered even after you reach it.
Co-pay: A co-pay is a fixed amount you pay each time you receive healthcare services, such as visiting a doctor. Co-pays vary depending on the service type and contribute to your out-of-pocket maximum. Carefully consider co-pays when choosing a plan, as these expenses can accumulate.
Co-insurance: After meeting your deductible, co-insurance is a cost-sharing arrangement where you and your insurance plan split the cost of healthcare services, often as a percentage. For example, with 80/20 co-insurance, your plan pays 80%, and you pay 20% after your deductible is met. Co-insurance payments count toward your out-of-pocket maximum, after which the plan covers 100%.
In-network/Out-of-network: Insurance companies have networks of contracted healthcare providers and facilities. In-network providers offer services at negotiated rates and are typically covered at a higher level. Out-of-network providers may have limited coverage or higher costs, or may not be covered at all. Verify if your preferred doctors and facilities are in-network for a plan you’re considering.
Cancer Insurance: This is supplemental insurance designed to cover out-of-pocket expenses related to cancer care that your primary health insurance might not fully cover. It can also help with non-medical costs like childcare or lost income due to illness. However, individuals already diagnosed with cancer are often ineligible for new cancer insurance policies. Carefully evaluate these policies to ensure they genuinely enhance your coverage rather than adding restrictions. Catastrophic illness insurance is a related option that can be added to regular health or life insurance to address the significant costs of serious illnesses like cancer.
Exploring Types of Health Insurance
Health insurance plans are diverse, offered by both government and private entities. Your specific circumstances will guide the best options for you.
Government-Funded Health Insurance Plans:
Medicare
Medicare is a federal health insurance program primarily for individuals 65 and older, and younger people with disabilities or End-Stage Renal Disease. Medicare offers various coverage options, including Medicare Advantage plans, which provide additional benefits beyond basic Medicare.
Medicaid
Medicaid is a joint federal and state program providing healthcare coverage to eligible low-income individuals and families, seniors, and people with disabilities. Medicaid is administered at the state level, so eligibility guidelines and benefits vary.
Tricare
Tricare provides healthcare coverage for active-duty U.S. military personnel and their families, National Guard members, reservists, survivors, and some former spouses. Care can be received through military facilities or civilian providers. Veterans should explore benefits and eligibility through the U.S. Department of Veterans Affairs website.
Private Health Insurance Plans
Private health insurance plans are offered by commercial insurance companies and are regulated by state and federal laws. These plans can be obtained through your employer or independently. Check with your employer’s human resources department or professional organizations to understand your options.
Private plans include various structures, such as Health Maintenance Organizations (HMOs) and Preferred Provider Organizations (PPOs). HMOs and PPOs are managed care plans that offer networks of providers. Staying within the network typically results in lower costs.
Fee-for-service plans offer more provider flexibility, directly paying providers or reimbursing you. While offering broader choice, they can be more expensive, and you may need to handle claims.
If you have employer-sponsored insurance and need to stop working or reduce hours due to cancer, COBRA (Continuation of Health Coverage) may allow you to maintain coverage for up to 18 months.
Obamacare (The Health Insurance Marketplace)
The Affordable Care Act (ACA), often called Obamacare, created the Health Insurance Marketplace. This marketplace offers subsidized private health insurance plans to individuals and families who may not qualify for government programs like Medicare or Medicaid. When using the Marketplace, aim for plans that offer both in-network and out-of-network coverage options for greater flexibility.
Key Questions to Ask When Choosing a Health Insurance Plan
While cancer coverage varies across plans, the Affordable Care Act prevents denial of coverage or plan cancellation due to pre-existing conditions, including cancer. Understanding plan nuances is essential for making the right choice.
As you research health insurance options, consider these crucial questions:
- What type of cancer treatment will you likely need?
- How long is your anticipated treatment duration?
- Where will you receive your cancer treatment?
- What is your current health insurance situation?
Your answers, alongside your financial assessment, will help determine if a high-deductible plan is suitable, whether your preferred providers are in-network, if an HSA, HRA (health reimbursement arrangement), or FSA (flexible spending account) can help with costs, and if supplemental insurance is beneficial.
For a comprehensive overview of cancer coverage and associated costs, resources like the American Society of Clinical Oncology’s cancer.net provide valuable information.
Understanding Insurance Coverage for Cancer Treatment
It’s crucial to compare plans and understand your potential out-of-pocket costs, including premiums, co-pays, deductibles, and maximums.
Consider these additional coverage aspects:
- Provider network: Which doctors and facilities are in-network?
- Specific cancer treatments: What is covered for surgery, radiation, chemotherapy, and immunotherapy?
- Medical supplies: Are essential supplies like gloves, needles, wheelchairs, or nutritional supplements covered?
- Prostheses and related items: Does the plan cover prostheses, wigs, or mastectomy garments?
Review the plan’s formulary (drug list) to see if your needed medications are covered and if pre-authorization is required for certain drugs, tests, or procedures.
Inquire about coverage for home healthcare, palliative care, physical therapy, rehabilitation, and mental health services, as these can be vital components of cancer care.
Insurance Coverage for Cancer Screening
Confirm whether a plan covers routine and preventive cancer screenings and genetic testing. Some plans differentiate between routine and diagnostic testing coverage. This information should be detailed in the plan’s “summary of benefits.” Many insurers cover routine screenings like colonoscopies and mammograms, aligning with government recommendations.
Leveraging Health Savings Accounts (HSAs)
HSAs, HRAs, and FSAs are tax-advantaged accounts, often employer-sponsored, allowing pre-tax savings for healthcare expenses. Government regulations dictate annual contribution limits and fund rollover rules. If you anticipate significant healthcare costs, maximizing contributions to these accounts can be a beneficial strategy to manage expenses. Check with your employer to learn about available accounts and contribution options.
Short-Term Disability and Cancer
To maintain income during cancer treatment, you may be eligible for Social Security Disability Insurance (SSDI). Individuals with sufficient work history and Social Security tax contributions who are unable to work, including some cancer patients, can apply for SSDI benefits. The Social Security Administration website lists cancers considered “disabling” for eligibility determination.
Additional Health Benefits to Explore
Beyond health insurance, other resources can help manage cancer-related costs.
Certain medical expenses not typically covered by insurance may be tax-deductible, including:
- Travel mileage for medical appointments
- Prescription medications
- Meals during extended medical visits
Consult your tax advisor for eligible deductions.
Further financial assistance options include:
Local and state non-profit and volunteer organizations: Many offer financial aid programs for serious illnesses, covering co-pays, co-insurance, premiums, deductibles, and other out-of-pocket costs.
Hospital and cancer center financial assistance programs: Many facilities offer programs to help patients with financial needs.
Pharmaceutical company patient assistance programs: These programs often aid eligible patients with medication and treatment-related expenses.
Contact your local American Cancer Society chapter or United Way for resources in your area.
If you’ve received a cancer diagnosis and are considering a second opinion on your diagnosis and treatment, please call us or chat online to speak with our team.
