Specific Health Insurance Policies
Rhode Island

Policy Options

Cancer insurance policies act to supplement existing health plans. Individual policies vary greatly and benefits are only paid in the event of occurrence.

Cancer Insurance:  This form of insurance pays benefits only for cancer treatments. These policies are generally sold to individuals who have no previous history of cancer. Most insurance experts recommend that individuals choose comprehensive insurance coverage as opposed to supplementing their coverage with cancer insurance. The following are five reasons why the experts recommend this:

1. Comprehensive insurance usually covers the costs of cancer treatment; additional cancer policies usually duplicate these policies and are an unnecessary expense.
   
   
2. Premiums for cancer policies are higher for limited benefits.
   
   
3. Cancer policies often do not cover complications of cancer treatments.
   
   
4. Some insurance companies and agents try to mislead consumers and prey on their fears about the incidence and reoccurrence of cancer.
   
   
5. Sales and administrative expenses for cancer policies tend to be much higher than for other policies.
   
   

Catastrophic Insurance:  These policies are comprehensive; they cover the costs of medically necessary services. These policies have low premiums and high annual deductibles. However, once you reach this deductible, the catastrophic policy will pay 100% of your expenses. Only individuals may enroll in this supplemental insurance policy.

Children's Health Insurance Program:  Also known as CHIP; provides health insurance coverage for low-income (up to 400% of the federal poverty level) children under the age of 19.

Disability Insurance:  This supplemental insurance provides individuals with an income if an illness or injury prevents them from working for an extended period of time. Social Security Disability Insurance provides protection to those who are severely disabled or unable to work at all. Worker's compensation provides benefits if the illness or injury is work-related; civil service disability covers federal or state government workers. These resources are limited but are an important form of insurance.

Hospital Indemnity Plans:  This supplemental policy pays a daily benefit for each 24-hour period that you are in a hospital. These policies are a source of extra cash during the time of illness, because benefits are paid directly to the individual in cash. This allows the individual to spend the money as they see fit. Hospital Indemnity Plans are relatively inexpensive and simple to buy. A fixed amount is paid for each hospital day, regardless of the accrual charges. However, some policies do not pay for first few days and have waiting periods for individuals with pre-existing conditions.

Hospital-Surgical Policies:  These policies provide benefits when an individual has a covered condition that requires hospitalization. The benefits typically include room and board, surgery, diagnostic X-rays, laboratory tests, non-surgical services and other hospital services. These policies may provide "first-dollar" coverage meaning that there is no deductible, or amount that you have to pay for a covered medical expense. Other policies may contain a small deductible. However, these policies usually do not cover lengthy hospitalizations and costly medical care.

Long Term Care Insurance:  This supplemental insurance provides daily benefits when individuals can no longer take care of themselves. The benefits can be used in the home, alternative care facilities, or nursing homes, as comprehensive policies covering skilled, intermediate or custodial care. Most companies that sell these policies require individuals be in fairly good health at the time of purchase. For cancer survivors, that generally means at least five years past treatment. Companies may also consider the type of cancer an individual has/had in deciding whether they qualify. Premiums are based upon age and health status.

Medical Savings Account (MSA):  With an MSA, instead of buying a standard insurance policy, you buy a catastrophic policy to cover high medical expenses. These accounts are tax-free and help individuals finance expenses; however, individuals must meet high deductibles.

Specified or Dread Disease Policies:  These policies provide benefits only if an individual gets the specific disease or group of diseases named in the policy. For example, a policy might cover the medical care for specified cancers. However, because benefits are limited in amount, these policies are not a substitute for broad medical coverage.

Insurance Policy Terms

Annual Limits:  Your health plan sets a maximum limit on the total number of health care services or on the total amount of money it pays for health care services each year.

Benefits:  Health plans agree to pay for specific health care services as part of your coverage.

Deductible:  The amount of money that you must pay for covered services before your health plan begins to pay for the services.

Indemnity:  A benefit paid by an insurance policy for an insured loss.

Limited Policy:  A policy that covers only specified accidents or illnesses.

Medically Necessary:  Certain health care services considered to be necessary for the treatment of your health care problem. Insurance companies may disagree with this.

Pre-existing Condition:  Any physical and/or mental condition of an insured that existed prior to the effective date of coverage.

Premium:  A periodic payment made by a policy holder (employer, individual) for the cost of insurance.

For further information on insurance policies, contact the
Rhode Island Department of Business Regulation at:
401-222-2223

If you found this information helpful, please consider making a donation to the Rhode Island Cancer Council so we may continue adding content to our website and providing valuable services to Rhode Island residents. Please click the Donate icon to the left to make a donation via credit card or your PayPal account.