How Supplemental Coverage Can Fill the Gaps When Your Health Insurance Plan Leaves You With the Bill

Category: How Supplemental Coverage Can Fill the Gaps When Your Health Insurance Plan Leaves You With the Bill Originally Posted: December 11, 2014 by Staff Last modified: September 10, 2016

Health insurance can make a big difference when it comes to paying for expensive medical care, from preventive services to cancer treatment. Yet, it only goes so far. Health care is never free, and if you’ve ever been hospitalized, broken a leg or simply needed to go to the dentist, cost has certainly crossed your mind.

If you are self-employed or lack access to job-based benefits, it is likely you only have health insurance. Whereas a comprehensive employer-sponsored benefits package often includes or provides access to dental and vision insurance, short-term and long-term disability insurance, life insurance, paid time off and a retirement plan, in addition to health insurance. Without paid vacation or sick days or additional insurance coverage, accidents and serious illnesses can be emotionally draining and financially devastating.

Fortunately, many supplemental insurance products exist to help fill coverage gaps and pick up where major medical leaves off. Monthly premiums are a fraction of health insurance rates, and the benefits can offer substantial relief during stressful times. Here are six types of supplemental insurance coverage to help cut your health care costs, from the routine to the worst-case.

  1. Accident – When you suffer an accidental injury, supplemental accident insurance pays a lump sum cash benefit that may be used to pay for medical expenses such as emergency care, ambulance transport and tests, as well as living expenses such as transportation, rent or utility bills. The benefits are yours to use where you need them most, so you can focus on healing and returning to daily life.
  2. Dental – Health insurance plans rarely cover dental care unless it is medically related, which means routine exams and cleanings, X-rays, fillings, root canals and other dental services must be paid entirely out of pocket. Dental insurance plans for individuals and families often include benefits that cover preventive care at or near 100 percent, without a waiting period. Dental plans also include benefits for diagnostic, basic and major care.
  3. Vision – As with dental care, health insurance plans only cover eye care that is considered medically necessary. Vision insurance and vision discount benefits can help reduce the cost of eye exams, lenses and frames. When shopping for supplemental insurance products, maximize your premium dollars by looking for coverage that includes a vision discount program.
  4. Critical illness – Critical illness insurance provides lump-sum cash benefits upon diagnosis of certain critical illnesses, including cancer, heart disease and stroke. These benefits may be used for virtually anything—experimental treatments, your health insurance deductible and/or coinsurance, bills and childcare, to name a few.
  5. Short-term disability –If you become temporarily disabled and cannot work, short-term disability insurance pays a percentage of your income for a specified duration. As with other supplemental coverage, these benefits may be used according to your needs.
  6. Rx discount card – Prescription drugs can account for a significant portion of health care expenses, especially if you routinely take medications for ongoing conditions. A discount drug card can help lower your out-of-pocket costs at the pharmacy counter or mail order pharmacy. They may be used to pay for specialty, brand name and generic drugs as specified by the plan details. Discount drug cards may be purchased alone but are often included with other supplemental coverage as an extra benefit, so keep an eye on the details when shopping for supplemental insurance products.

Where to find supplemental insurance coverage

Supplemental insurance plans may be purchased individually, but many bundled products that include multiple coverage types exist in the market. These bundled supplemental plans may be called gap plans and typically include added benefits such as discount vision and drug cards, access to telehealth providers, patient advocacy newsletters and services, and more. Individual and bundled supplemental products can be purchased online and through health insurance agents and brokers.

How supplemental plans work with health insurance

Remember: Supplemental insurance plans are intended to complement your ACA-compliant health insurance plan. They are not considered minimum essential coverage under the Affordable Care Act.

When you shop for ACA-compliant health insurance, consider your various options to determine where your dollars are best spent. The cheapest monthly premium may not be the best way to save.

Consider this, for example: The average bronze plan deductible across most states is $5,081 for an individual and $10,386 for a family, while the average silver plan deductible is $2,907 for an individual and $6,078 for a family. The premium difference between bronze and silver is likely to a few hundred dollars total over the course of a year. Furthermore, if your income is less than 250 percent of the federal poverty level and you buy a silver plan from a state-based or federally facilitated exchange, you may qualify for additional cost-sharing subsidies—in addition to the premium tax credit available to those up to 400 percent of federal poverty.

If you tend to seek medical care beyond preventive services, you might consider a lower deductible plan and use the money you save to purchase supplemental coverage. This can be a good way to keep out-of-pocket costs manageable when your health insurance does not foot the whole bill.

1 “Deductibles, Out-Of-Pocket Costs, and the Affordable Care Act.” Dec. 12, 2013. Retrieved from

2 “Healthcare Usage & Choosing the Least Expensive Affordable Care Act Plan.” Dec. 19, 2013. Retrieved from