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  • Writer's pictureTom Cianflone

Do You Need a Co-Payment Protection Plan?

co-payment protection plans

Around half of the Medicare population is enrolled in Medicare Advantage plans (aka, Part C plans). These private carrier plans are attractive because you can enroll in them for no additional monthly premium beyond the Part B premium you pay to the Medicare program. These plans are considered "pay-as-you-go" because, as you use certain benefits, you will have co-pays for which you will be financially responsible. This all works nicely as long as you're in good health. Once you start experiencing health issues however, the co-pays can add up. These plans have an annual maximum out-of-pocket (MOOP) cost cap. In South Florida: for HMOs typically between $1,000 to $3,000 MOOP, and for PPOs typically between $3,400 and $5,000 MOOP for in-network care or up to $10,000 MOOP once you go out of network. Do you have the money to cover mounting co-pays such as can be brought on with extended hospital stays or skilled nursing facility stays? Can you sustain a couple of years hitting your maximum out-of-pocket cost cap if you need extended treatment for an unexpected diagnosis?

A Club You Definitely Don't Want to Join

The staggering amount of medical debt on the books in the United States in 2023 suggests that many do not have the safety net to manage co-pays related to medical care. Of the $200B (that's 'billion' with a 'B') in medical debt currently on the books, the second largest population segment of that medical debt "club" is Medicare beneficiaries. That debt represents co-pays and coinsurance for medical services rendered but which have not been paid because the Medicare beneficiary could not afford their financial obligation for the care they received. That's a club you do not want to join!

Co-Payment Protection Plans to the Rescue!

If you are enrolled in a Medicare Advantage plan, especially if you are enrolled in a PPO, you should consider enrolling in a co-payment protection plan (CPP). Doing so could reduce your risk of becoming part of the unpaid medical debt club. CPPs are offered by private health insurance companies and are suprisingly moderately priced with basic coverage available from around $40/month. These plans can be configured to pay you a cash benefit for many of the common medical services for which you would typically have co-pays, for example:

  • Hospital admission benefit: pays a lump sum for hospital admission

  • Hospital observation benefit: pays a daily sum for each day you are in observation status in a hospital

  • Hospital per diem benefit: pays a daily sum for each day you're admitted in the hospital. Typically we configure this sum to match your inpatient hospital co-pay per diem.

  • Emergency room visit benefit

  • Skilled nursing facility per diem benefit

  • Ambulance trip benefit

  • Cancer diagnosis benefit: pays a lump sum benefit for first diagnosis of a cancer

Ask Me About Co-Payment Protection Plans!

If you are at all concerned that the co-pays associated with your Medicare Advantage plan could put you at risk for uncontrolled medical debt, contact me anytime to talk about co-payment protection plans! Remember, these plans pay cash directly to you, not to medical providers, so you can use the cash any way you like. For those of you turning 65, you can get this coverage regardless of any preexisting conditions! That's right! No medical questions if you are between the ages of 64-1/2 and 65-1/2! The right plan configured just for your individual needs can manage your medical debt risk and help you sleep easier knowing that you've got your co-pays covered!


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