Expand & Dominate | Lesson 5

Cross-Selling Hospital Indemnity Insurance

Medicare Part A covers hospital insurance, but only to a point. Extended hospital stays can quickly become expensive with your client paying thousands in out-of-pocket costs.

Unless of course, they have a hospital indemnity plan.

This form of ancillary protection is designed specifically for in-patient hospital stays. It helps offset or eliminate the copayments and costs associated with your client’s hospitalization.

Ideal clients for hospital indemnity plans include those in low or zero-dollar Medicare Advantage plans. These types of plans typically have high inpatient hospital copays so extended stays can be costly.

Enrollees in a Medicare Medical Savings Account or an MA plan with a high deductible can end up owing a lot of money all at once if they’re hospitalized unexpectedly before they reach that deductible.

Hospital Indemnity plans are great plans to pitch alongside MA and MSA plans during enrollment periods, as long as your client has chosen the product on their Scope of appointment.

You can also discuss the benefits of Hospital Indemnity at follow-up appointments when you’re checking in to make sure your client is happy with their primary coverage.

And bringing Hospital Indemnity into the conversation is relatively simple, especially as you’re reviewing plan benefits and talking about out-of-pocket costs.

Use your fact-finding skills and ask if your client lives on a fixed income. Ask how they would afford an unplanned visit to the hospital. Ask how that might change if the visit lasts a few days.

Illustrate the value by comparing the cost of having a hospital indemnity policy, and the cost of foregoing coverage. Stats like this one might help, for a person 65-84 years old, the mean length of a hospital stay is 5.2 days, and the mean cost of a stay is $13,000. Some Medicare Advantage plans have out-of-pocket limits as high as $6,700. That means your client would still be responsible for $6,300 of that hospital stay. Comparatively, the annual premium for a hospital indemnity plan for a senior can be as little as $400.

While selling hospital indemnity does provide peace of mind for your clients, it’s also a lucrative income stream for your business.

You can practically double your commission earned on any replacement MA plan you write by writing an affordable hospital indemnity plan with it.

If you sell Medicare Advantage plans or Medicare Medical Savings Account plans, this ancillary product should also be in your portfolio.

If you need help choosing competitive plans for your territory, reach out! Our team would love to help.

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