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How Does A Fixed Indemnity Plan Work?

A fixed indemnity insurance product like Health ProtectorGuard, underwritten by Golden Rule Insurance Company, works differently than other insurance you might have had in the past that helped pay for health-related costs.F10 Fixed indemnity insurance pays a set benefit per specified medical expense, as opposed to a share of the total covered costs after a deductible, which is an approach you might be used to.

So how does that actually work? A look at a couple common scenarios might help you understand the benefits of this type of fixed indemnity plan.


Hector’s pain in the neck – Strep throat

Hector likes to say he’s “never” sick, so it takes 4 days of a worsening sore throat and a persistent headache to get him to seek help. He doesn’t have a regular doctor, so he finds the nearest Urgent Care facility with a doctor he can see on short notice and explains how he’s feeling.

The doctor examines his throat and checks his neck for inflammation. She doesn’t like what she sees, so she swabs Hector’s throat and sends the swabbed sample for testing. The result that comes back is what she expected, strep throat. The doctor prescribes a generic antibiotic to battle the infection, which Hector fills at a nearby pharmacy.

Hector has a Health ProtectorGuard Choice Plus plan in addition to his health insurance plan.F18 What would his fixed indemnity insurance plan pay in this case?

Covered ServiceHealth ProtectorGuard Choice Plus BenefitBenefit Paid
Urgent Care visit$100/visit$100 (for 1 visit)
Outpatient lab/X-ray$200/test$200 (for 1 outpatient strep test)
Prescription antibiotic$20 generic/$40 brand per Rx fill$20 for generic antibiotic

Hector would be paid a total of $320 in this case.


Network discounts without network restrictions

When Hector pays for his services, he gets a couple of nice surprises:

  • Both the doctor and the lab are part of the Multiplan Limited Benefit Plan network, meaning he gets discounted rates for his services there.F19
  • Because he filled his prescription at a pharmacy that accepts the National Prescription Savings Network discount card that came with his plan, he got a discount on his antibiotics as well.

You don’t have to stay in the Multiplan network or go to participating pharmacies. With Health ProtectorGuard, you can go anywhere and still receive benefits for covered services. However, if you stay in-network or with participating pharmacies, your benefits can go even further. (Note: If you have a major medical plan, you may need to stay with certain networks and providers to get the most coverage out of that plan. Be sure to take that into consideration.)

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Important note

The examples offered here are just that—examples created to show you how this type of fixed indemnity plan might work.

No insurance plan covers everything, and Health ProtectorGuard insurance plans are no different. These plans can provide a helpful companion to other insurance, but just like other types of insurance, they have their own full explanation of what they do and don’t cover that you should be familiar with before you buy.

The link below will take you to the product brochure where you can find out more about if Health ProtectorGuard fixed indemnity insurance would work for you.


Carla skips dessert - Emergency appendectomy

Carla’s eating dinner out with a friend when that stomach twinge she has been feeling all day gets much worse. Her friend drives her to the closest hospital and straight to the emergency room. After an initial exam, the ER doctor orders an ultrasound to look at her abdomen. The doctor diagnoses appendicitis, and Carla is prepped for surgery, in this case an open appendectomy.

After the successful surgery, Carla spends a day in the hospital recovering and is given some prescription pain medication to take home for any discomfort.

Carla has a Health ProtectorGuard Premier Plus plan in addition to her health insurance plan.F18 What does her fixed indemnity insurance plan pay in this case?

Covered ServiceHealth ProtectorGuard Premier Plus BenefitBenefit Paid
Emergency room$500/day$500 (for 1 day)
Ultrasound$300/test$300 (for 1 test)
Surgeon$5,000 (for Tier 3 surgery)$5,000
Anesthesiologist30% of Surgeon benefit$1,500
1 day hospital stay$5,000/day$5,000 for 1 day
Prescription pain medication$20 generic/$40 brand per Rx fill$20 for generic pain meds

Carla would be paid a total of $12,320 in this case.




You’re paid the same, no matter what the care costs

In 2015, the International Federation of Health Plans found the average cost of an appendectomy in the United States to be $15,930. However, 25% of the time it found costs around $9,332 for the same procedure.F20

Carla’s benefit of $12,320 will be paid no matter what. If her care only adds up to $9,332, then she keeps the rest. If her care costs more than what the plan pays, she’s responsible for the rest. That’s what a hospital and doctor fixed indemnity insurance plan like Health ProtectorGuard does — pays a set amount to you after a specific medical service no matter the cost.


Fixed indemnity insurance - the deductible killer!

The fixed benefits from this indemnity plan are paid regardless of other insurance you have and are designed to help cover what your major medical plan doesn’t.

In this case, if Carla’s major medical plan had a $6,000 deductible, the $12,320 her fixed indemnity insurance paid for her appendectomy could help her pay that deductible amount and then some. It might even help her pay her major medical’s maximum out-of-pocket costs for the year. After that, with her major medical plan covering most of her health care expenses, she could use any benefits paid on her fixed indemnity plan for whatever she wants.


Need More Help for the Unexpected?

Bundle Fixed Indemnity Insurance with Critical Illness or Accident InsuranceF21


Accident Insurance

Giving you some additional coverage in case you’re hurt in an accident, Accident Insurance can pay you cash benefits for your qualifying medical bills.F32


Critical Illness

Worried about paying the bills if you fall ill? Critical illness insurance helps with a lump sum cash benefit following the diagnosis of a qualifying illness.F55