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Supplemental cancer insurance: Everything you need to know in 2024

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No one wants to think that they'll get cancer someday. However, the numbers tell a different, more sobering story:

In 2018, 18.1 million new cancer cases occurred and 9.5 million cancer-related deaths were reported worldwide, according to the National Cancer Institute. By 2040, the number of new cases will likely rise to 29.5 million and the number of cancer-related deaths will shatter records — up to 16.4 million.

Knowing these numbers, do you think you might want to get supplemental health insurance for cancer, just in case? It could help you pay for out-of-pocket costs if you do end up getting that devastating diagnosis.

Let's explore the ins and outs of supplemental cancer insurance so you can decide whether you want to get it for yourself.

What is supplemental cancer insurance?

Supplemental cancer insurance is extra insurance designed to add to your health insurance policy, not replace it. Supplemental plans require you to pay monthly premiums just like standard health insurance, but the benefits involve a lump-sum cash payment that goes to you.

You may think you can just rely on your standard health insurance to cover cancer. However, your health insurance often doesn't cover extraneous cancer expenses, such as any days you might miss work or extra expenses. Your supplemental cancer insurance policy may step in and cover those costs.

Supplemental health insurance for cancer can help with certain out-of-pocket costs of cancer, including the following:

  • Deductibles and copays for your insurance provider
  • Out-of-network charges (for example, maybe you have to go out-of-state for care and your insurance company doesn't allow you to go out of the network)
  • Travel and lodging for you and/or your caregivers
  • Childcare
  • Lost wages
  • Other items that you need to pay for that your standard health insurance won't cover

Who buys cancer insurance?

As you might imagine, someone who has a higher likelihood of developing cancer may choose to get cancer insurance. For example, let's say you choose to undergo genetic testing due to your family history of cancer. The genetic tests say you have a higher likelihood of getting breast cancer and colon cancer. You may want to buy supplemental cancer insurance based on the results of that test (in addition to undergoing regular screenings).

Other individuals who may want to buy cancer insurance include tobacco users (especially those who use alcohol as well as tobacco). People who spend a lot of time out in the sun or regularly use tanning beds may also consider getting supplemental cancer insurance. Other individuals may not have specific risk factors at all but may have witnessed a friend or family member suffer from cancer and also suffer from the financial aspects of the disease.

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How does supplemental cancer insurance work?

You can boil the supplemental cancer insurance buying process down into just a few steps. Here's how to find the best supplemental cancer insurance for you.

Step 1: Shop around for supplemental cancer insurance

A range of companies offering comparable products. Choose between three and five companies and research costs, coverage amounts, coverage options, waiting period requirements, benefit caps, and more.

Step 2: Check with your employer

Sometimes employers offer supplemental cancer coverage, in which you purchase supplemental insurance through a payroll deduction from your employer. Check with your employer to find out whether you can purchase supplemental coverage.

Step 3: Choose a plan and pay your premiums

Once you've compared all the basics (and read the fine print) on all your supplemental cancer insurance options, choose the right plan for you.

Just like with your standard health insurance, you make monthly premium payments.

Step 4: File a claim with your insurance company

Hopefully, you never need to use this, but if you become diagnosed with cancer and have qualified expenses, you file a claim with your insurance company. Typically, insurance companies offer payouts as lump-sum cash paid directly to you as long as the claim satisfies the terms of the policy.

Step 5: Keep track of your ongoing expenses

When you get a cancer diagnosis, you want to keep track of every single bill that comes your way. File them electronically and do your best to sift through qualified out-of-pocket treatment costs, travel to a medical facility, and even household bills and mortgage payments. Your insurance company can help you determine which types of insurance claims qualify.

How much does supplemental cancer insurance cost?

The amount you'll pay for supplemental insurance premiums will vary depending on your health insurance company's deductible and out-of-pocket maximum costs.

In addition, depending on where you live and get treated, cancer costs can amount to a lot more (cancer costs will cost more in California compared to cancer costs in Nebraska). The average cost of cancer treatment comes out to roughly $150,000, according to AARP.

Many supplemental cancer insurance policy premiums cost between $10 to $50 per month, though the costs depend on the provider you choose.

Is supplemental cancer insurance worth it?

The answer: It depends on your situation.

You may want to seriously consider getting a supplemental cancer insurance policy if you:

  • Have a high risk or family history of cancer
  • Know you have gaps in your health insurance coverage
  • Couldn't afford to pay your deductible or coinsurance today if you had to
  • Have limited savings
  • Don't have an emergency fund
  • Have a Medicare Advantage (MA) plan (you may want supplemental cancer insurance if you have a $0 MA premium plan)

On the other hand, if you're young, healthy, and not at high risk, you may want to forgo supplemental cancer insurance, particularly if you:

  • Have bulletproof health insurance coverage
  • Would have no problem covering your deductible or coinsurance if you had to
  • Have a hefty emergency fund stashed away

Still on the fence about whether you need supplemental cancer insurance? Consider your health situation, your savings, your current health insurance coverage, and whether you want the added cushion that supplemental cancer insurance can bring. Sometimes peace of mind is all you need to make the right decision for you.

The information and content provided herein is for educational purposes only, and should not be considered legal, tax, investment, or financial advice, recommendation, or endorsement. Breeze does not guarantee the accuracy, completeness, reliability or usefulness of any testimonials, opinions, advice, product or service offers, or other information provided here by third parties. Individuals are encouraged to seek advice from their own tax or legal counsel.

— Published June 5, 2021
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