A Guide to Hospital Indemnity Insurance for Seniors in 2024

Healthcare needs can be unpredictable, and unexpected hospitalizations can happen to any senior. These urgent visits or recovery periods are oftentimes expensive and Medicare doesn’t pay for everything.

Adding Hospital Indemnity Insurance to your Medicare coverage can provide peace of mind, knowing that there’s an additional layer of financial protection in place.



How Does Hospital Indemnity Insurance Work?


Hospital indemnity insurance is a supplemental coverage that can be purchased in addition to your Medicare Advantage plan to help pay for out-of-pocket expenses associated with a hospital stay.

These policies provide benefits associated with your hospital stay, that can help you to cover costs like deductibles, co-pays, and other medical expenses.

The policyholder pays a premium for the policy and then when coverage is needed, hospital indemnity insurance pays benefits directly to the insured to spend where necessary, rather than sending the benefit payment to the medical providers for one particular part of the healthcare.  The benefits may also be paid directly to the hospital or other health care facility if an assignment of benefits is made by the policyholder. 

  • There is no deductible associated with this coverage and no network you must stay within. This makes the claims process faster and more simplified, and it also allows seniors a broader provider selection.
  • The insured can build their own plan that fits their monthly budget and decide what coverages they want or need prior to the policy issue.
  • Coverage specifics, however, can vary–so it’s essential to review the policy details with a licensed agent while selecting your plan.

How Hospital Indemnity Insurance Helps You


This supplemental coverage policy helps by paying benefits that can help cover expenses associated with unexpected hospital stays and procedures such as:

Deductibles and Copayments – Hospital stays and procedures, along with emergency care, often come with higher out-of-pocket costs not covered by a senior’s primary healthcare plan. Hospital Indemnity Insurance can help offset these high coverage gaps or pay for them completely based on what coverage levels are selected in a senior’s particular plan.

Extended Hospital Stays – If a Medicare recipient requires a hospitalization period longer than what their Medicare Advantage plan covers, Hospital Indemnity Insurance can step in and help pay for costs associated with the stay.

Non-Covered Services – Certain services or testings associated with a senior’s hospitalization may not be fully covered or covered at all by their Medicare Advantage plan. Hospital Indemnity Insurance can help assist with the expenses associated with the recipient’s healthcare needs based on what they’ve selected prior to the policy’s issue.

At-Home Recovery – While Medicare typically covers a portion of inpatient rehabilitation, it may not cover home recovery services. Hospital Indemnity Insurance may provide financial assistance for at home recovery including necessary medical equipment and services.

Transportation Costs – Medicare Advantage plans may cover some transportation costs for hospital visits (such as ambulance usage); however, it may not cover them in full, especially for longer distances. Hospital Indemnity Insurance may help to cover the balance or full amount if necessary if the benefit level written prior to issue is adequate.

What is the Advantage of Hospital Indemnity Insurance vs Other Supplemental Plans?

A variety of  supplemental plans  are available to Medicare recipients, each offering different benefits tailored to the specific plan.

Hospital Indemnity Insurance can be a great alternative or addition to these based on:

Claims are Simple to Submit – Unlike certain Medicare Advantage plans that require screenings or preauthorizations for hospital procedures/treatments, Hospital Indemnity Insurance is a voluntary benefit that’s guaranteed. There are no screenings or health questionnaires involved. Seniors are paid for the coverages that they selected for their specific plan at issue.

Payments are Made Directly to the Recipient – Because payment is made directly to recipients versus the healthcare providers, they can allot that money where they see fit. Once that money is in the senior’s possession, they choose how to apply it.  The benefits may also be paid directly to the hospital or other health care facility if an assignment of benefits is made by the policyholder.

Supplemental Coverage Eases Financial Burden – Having hospital indemnity insurance can assist seniors with financial planning for their future. It helps avoid surprises by expensive, unexpected costs associated with unexpected hospital stays.

Enroll Any Time – This supplemental coverage can be added to your plan any time of the year. Seniors do not have to wait until open enrollment for the addition.

Let’s Consider a Scenario Where This Supplemental Coverage Can Assist a Medicare Recipient*:

Charlotte is a senior receiving Medicare who lives alone in her home in Northeast Ohio. On one wintry morning, she slipped on ice, hurt her leg, and needed to call emergency care. An ambulance came to her aid and took her to the local hospital.

The doctors immediately took x-rays and determined there is a break in her leg, but also wanted to perform a CT scan and bloodwork because she complained of dizziness that led to her fall. Her scans came back normal, but she appeared to be dehydrated and low on certain nutrients. Charlotte’s doctors recommended that she stay for a night or two to be monitored and receive IV treatments.

Charlotte was then released from the hospital and had to take professional transportation back to her home. She couldn’t drive with the cast on her leg while the break healed and had trouble getting around. She hired in-home care to assist certain hours of the day and add ease to her routine. She also installed different home modifications to avoid any future slips, such as grab bars in her shower. Charlotte also had her groceries and meals delivered until she was ready to be back on her feet.

Charlotte has Medicare Advantage coverage, but still would have incurred over $3,000 in out-of-pocket costs from her co-payments, deductibles, transportation expenses, and in-home care. Her Hospital Indemnity Insurance paid benefits directly to her to help with these costs. This coverage also assisted her by paying benefits towards her rehabilitation costs and home modifications to prevent future falls.

Because Charlotte selected Hospital Indemnity Insurance, she can focus on her health and healing. 

*This is a fictional example for illustrative purposes only.



Hospital Indemnity Insurance is an excellent way for seniors to help off-set costs of an associated hospital stay not covered by their Medicare Advantage plan.  A senior can build the coverage that they want and need at issue that will fit their healthcare needs and monthly budget. Enrollment is easy and can take place any time of year, not just the open enrollment period like other supplemental plans. 

If you have any questions about Hospital Indemnity Insurance, make an appointment with a licensed agent of My Medicare Network, a non-governmental entity, to discuss if this coverage is right for you.

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