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Part one: How cancer insurance may affect treatment and recovery

Its onset is yet a medical mystery, and its state of aggression is highly unpredictable by case; yet, there is no mistaking the devastating effects, both financial as well as emotional, that can take its toll further on its victims. National statistics suggest that more than 1 in 2 men and 1 in 3 women respectively will be diagnosed with a form of cancer in their lifetime, with an increase in the risk if specific factors are present.

What does this statistic really mean for individuals? Does it mean that everyone should live each day like it was their last on earth? Not in this respect. Rather, it means that with a little bit of preplanning and preparation, a diagnosis of cancer can be better handled from a financial perspective, which in turn may reduce a portion of the stress on someone inflicted with the disease.

Many medical professionals will agree that the presence of stress can further weaken a body’s immune system, making it less likely to fight off infection and illness and cause additional complications. Couple higher levels of stress with the anxieties from additional costs, deductibles, copayments, and the potential losses of income and the situation can deteriorate quickly. For many, having health insurance that will cover some of the medical bills up to the limits of the policy gives a comfort and peace of mind, but understand that too often a person’s medical insurance is nowhere near enough to defray the total bill.

It is in this situation that cancer insurance may offer some additional benefits. Often misunderstood, cancer insurance is NOT available to protect you from getting cancer. It is not like placing a person in a protective sleeve that will prevent all the ills and accidents from ever occurring. However, it is a mechanism that shifts the risk of some of the costs onto another entity. When you buy insurance, you are basically gambling that you will need the benefits at some point and that the wager is the premium. On the other hand, the insurance company is more or less accepting the same gamble in that they are offering the benefits as their side of the wager in return for accepting your premium.

This is not to say that when you buy insurance that you are gambling. However, by some points of view, the operation of the process is the same.

Let’s examine two distinct scenarios.

The first scenario involves John (a fictitious name). He is 35 years old and is single with no dependents. After going to his doctor for abdominal pains that grew worse over time, he learned that his diagnosis was an internal cancer (for the sake of this article, the specific cancer will not be identified, but rather will be discussed only as internal or external).

After consulting with his doctor and family members, it was decided that the first course of action would be surgery followed by blasts of chemotherapy. While other methods of fighting the disease involve experimental treatments, John’s insurance company advises him that certain procedures will not be covered unless they are FDA (Food and Drug Administration) approved and that many experimental drugs and treatments do not meet this requirement.

John understands that while he is undergoing his treatment, he will, for at least a period of time after his surgery, be unable to work and potentially care for himself. Sitting down again with his family, a budget of daily and monthly living expenses are prepared to see how his normal bills will fare once his treatments begin. John has short and long term disability plans through his employer, yet he understands that the money he will get from them are subject to waiting periods and are only a fraction of what he has become accustomed to living on. In addition, if a caretaker is needed to help with basic living needs, there may be additional costs incurred.

All the figures added up, John realizes that for an estimated period of six months, he may have enough resources to finance his treatments while he battles his cancer. However, his pulse begins to quicken as he realizes that cancer can be unpredictable. His doctor is unsure if the cancer has begun to spread and how long his recovery period may last. If there are complications, his out-of-work period may be much longer than initially predicted.

We move over to another doctor’s office where Steve (also a fictitious individual who is helping with this scenario) was just informed that they discovered and internal cancer after bouts of stomach pain that resulted in a trip to the doctor. Steve is also 25 years old and is unmarried with no dependents. His situation is similar, yet he was a little more financially prepared. Steve, unlike John, knew that cancer ran in his family history.

Although a family’s history of cancer cannot specifically guarantee that another of the same bloodline will become inflicted, the chances are higher than if those indicators were not present. When Steve’s relative (Let’s say it was an Uncle) was diagnosed, Steve found it important to get additional insurance in the event he was positively diagnosed. Although some told him it was a waste of money, he realized that the chances of him saving the equivalent of the premiums may not equate to the same amount as the benefits from the chosen plan.

Although Steve’s health insurance only pays for 80% of the doctor’s bills, his cancer plan in an indemnity plan that pays the benefit to him instead of the doctor or hospital. With the money he receives from his policy, Steve is able to pay for the excess that his health insurance does not cover. In addition, he also discovers that it is possible that he may be reimbursed for some the additional charges for experimental treatments, his hospital stay, and follow-up visits. Any excess money he receives may be applied to his every-day bills as needed.

While as an insurance agent, I am often asked which policy is best for insurance against a cancer risk, I always tell my clients and those who inquire that there are several types of policies available and that many more companies are developing forms of cancer insurance. Some health insurances now have additional benefits specifically for cancer for additional premium dollars. Other companies have stand-alone policies available that will coordinate with a health insurance policy present. Finally, indemnity policies are available that offer benefits payable to the policyholder instead of the doctor. In all of these cases, it is imperative for a person seeking a cancer policy to ask what the process is for the payment of benefits with a current health policy. In some cases, a cancer policy is not able to be sold with some health policies.

It cannot be stressed enough to question, in advance, a plan’s limitations and exclusions, as well as the benefits of a cancer policy. As stated, a little preplanning may offer valuable resources not available through a traditional insurance plan. While cancer insurance is a very valuable tool and resource, it is not for everyone. On an already-tight-budget, the premiums may become too costly to maintain.

Some premiums for cancer plans are quoted at the initial application and are locked in for the life of the insurance contract. In short, this means that the younger an applicant is, the lower the premiums will be as he or she gets older. However, in regards to cancer, age is not a discriminating factor, as more and more younger people are being told they have a form of cancer.

The two scenarios represented here are merely two possibilities in a vast amount of situations. Not represented here are the possibilities of cancer clusters based on geographical location, family involvement, lifestyle influence, and family structure, all of which can play a role in how an individual may differently handle the same diagnosis. It bears repeating that preplanning and weighing all one’s options can be extremely important.

Yes, October represents National Breast Cancer Awareness, and all across Wisconsin the month long event is represented by an increase in pink ribbons. Yet, just as important is to remember that cancer does not discriminate based on sex or race, color or creed, age or intelligence. Yet how one considers the possibilities of the risks may make the differences in treatment and recovery.

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