How a Cancer + Heart/Stroke plan helped a self-employed owner after a heart attack

Marcus is 58. He has fixed washers, dryers and refrigerators around Las Vegas for most of his working life. For the last nine years he has done it for himself: one van, one rented bay in a small industrial park, and one helper, Luis, who works part-time.

Being self-employed means Marcus buys his own health insurance. His plan has a high deductible, which keeps the premium manageable. He has always known that a bad year would cost him the full out-of-pocket maximum.

What worried him more was the work. If Marcus can’t work, the business doesn’t earn. The rent on the bay is still due. Luis still needs to be paid. Customers who wait too long call someone else.

Why he looked at critical illness insurance

Two years ago, Marcus sat down with his budget and asked himself a plain question. If he were seriously ill for a few months, what would it cost him beyond the medical bills?

The answer was more than his savings could cover. So he looked for coverage that pays cash he could use for anything, including keeping the business running.

He chose CriticalGuard, a critical illness plan underwritten and administered by Golden Rule Insurance Company, a UnitedHealthcare company.

What he chose

CriticalGuard comes in four plans: Cancer, Heart/Stroke, Cancer + Heart/Stroke, and Critical Illness, the full suite. Each pays a lump sum on a First Diagnosis of a Qualifying Event. First Diagnosis means the first occurrence in the covered person’s lifetime, after the waiting period and while the policy is in force. It doesn’t apply in some states.

Marcus chose the Cancer + Heart/Stroke plan. He wanted both of the risks he thought about most, without paying for the full suite.

This plan has two categories, and each has its own Benefit Lifetime Maximum Amount:

• Cancer: life-threatening cancer pays 100%; cancer in situ and benign brain tumor pay 25%; skin cancer pays $500.
• Heart/Stroke: heart attack pays 100%; stroke pays 100%; heart illness pays 25%.

You choose the maximum in $5,000 steps. At issue ages 50 to 64, the range for this plan is $10,000 to $100,000. A maximum of $10,000 is guaranteed issue at those ages, which means no underwriting. Marcus wanted more than that, so his application asked some medical questions. He chose $40,000, which applies to each category.

He also added one optional rider, the Telemedicine rider. It gives $0 general physician consultations, unlimited, by app, web or phone, 24 hours a day. Behavioral health and dermatology consultations carry an extra charge. Unlike the plan itself, this rider is not subject to the waiting period. Riders cost extra and can only be added at application.

The other riders are Wellness ($75 per exam, one exam per calendar year) and Outpatient Prescription Drug ($15 per generic fill and $50 per brand-name fill, up to a combined $600 per calendar year). Marcus skipped both.

What happened

About two years after his plan took effect, Marcus was carrying a dryer up a flight of stairs when he felt pressure in his chest that didn’t go away. Luis drove him to the emergency room. That night, a doctor told him he’d had a heart attack.

He spent several days in the hospital. His doctors told him he would need weeks away from heavy work, and cardiac rehab after that.

His health insurance covered his hospital stay and treatment, after his deductible and coinsurance. CriticalGuard was there for the rest.

How the claim worked

The brochure asks for notice of a claim within 30 days after the First Diagnosis, or as soon as reasonably possible. Marcus’s daughter printed the claim form from the UHC Member Hub while he was still in the hospital. They filled it in together and sent it with the information the form asked for.

The arithmetic was simple:

• Marcus’s Heart/Stroke Benefit Lifetime Maximum Amount: $40,000
• Share for a heart attack: 100%
• $40,000 × 100% = $40,000

The plan paid Marcus $40,000 in a single lump sum, directly to him. Two details matter here:

1. It paid regardless of his other insurance. His health plan paying for the hospital didn’t reduce the CriticalGuard benefit.
2. It paid a stated amount, not his actual expenses. The brochure says benefits are paid regardless of the actual expense incurred.

The other category stayed in place

This is the part of the Cancer + Heart/Stroke plan that many people miss. The heart attack used up Marcus’s Heart/Stroke category. It didn’t touch his Cancer category.

After the claim, his two categories looked like this:

• Heart/Stroke: $40,000 paid, $0 left
• Cancer: $0 paid, $40,000 still available

Suppose Marcus were later diagnosed with cancer in situ. The plan could pay 25% of the Cancer maximum:

• $40,000 × 25% = $10,000 paid
• $40,000 − $10,000 = $30,000 still available in the Cancer category

The brochure says that when a payment in a category is less than 100%, the remainder stays available for a later Qualifying Event, according to the policy’s terms. The total in one category never goes above its maximum.

Keeping the business running

The $40,000 was Marcus’s to use as he saw fit. The brochure is plain that you can use it for bills, living expenses, out-of-pocket medical costs and more. Here is how Marcus used it:

• $7,500 for his share of the year’s medical costs. That was his health plan’s out-of-pocket maximum, and he reached it.
• $8,000 to give Luis more hours for ten weeks, so the lighter jobs kept getting done and regular customers kept calling.
• $4,500 for three months of rent on the bay.
• $9,000 for three months of household bills: the mortgage, utilities and groceries.
• $11,000 kept in reserve while he worked his way back to full days.

That adds up to $40,000. Marcus didn’t have to close the business or drain his retirement account to keep it open. He came back slowly. He took the light jobs first and left the stairs to Luis for a while.

How it fit next to his health plan

It helps to see the two kinds of coverage side by side, because they do different jobs.

His health insurance paid the hospital, the doctors and the cardiac rehab, under its own rules. Marcus paid his deductible and coinsurance until he reached the plan’s out-of-pocket maximum. The money went to the people who treated him.

CriticalGuard didn’t pay any provider. It paid Marcus. The amount was set the day he chose his maximum, not by what his care cost. He would have received the same $40,000 if his hospital bill had been half as large, or twice as large.

That is why the two fit together. The health plan protected him from the medical bills. The lump sum covered the gap those bills leave behind: the out-of-pocket share, the lost work, and the costs of a business that doesn’t stop when its owner does.

It also explains why Marcus chose a maximum of $40,000 rather than the $10,000 guaranteed issue amount. He added up his out-of-pocket maximum, three months of rent and household bills, and extra pay for Luis, and wanted a benefit that came close.

The heart program and other services

The Cancer + Heart/Stroke plan includes two Optum programs at no added cost. The brochure says they are not insurance and may require a diagnosis to qualify.

• The Optum Heart Failure and Coronary Artery Disease Management Program. According to the brochure, it combines personal interaction, educational resources and real-time monitoring. It offers information and resources to help you understand your condition, recognize and manage symptoms through daily monitoring, improve your activity tolerance, and stick to your doctor’s treatment plan and medication.
• The Optum Cancer Resource Service, with an oncology nurse and help finding providers, if Marcus ever needs it.

Marcus’s doctors diagnosed coronary artery disease along with the heart attack, and he joined the heart program. He liked having someone to check in with between appointments. He also used his Telemedicine rider for general questions that came up in the evenings, when his doctor’s office was closed.

The plan also includes Optum Perks, a prescription discount card. It’s a discount program, not insurance, and it’s open to the general public.

What the plan didn’t do

Marcus’s plan did what it promised. It also has firm edges, and they’re worth knowing before you buy.

The Heart/Stroke category is now used up. Marcus’s heart attack paid 100% of his Heart/Stroke maximum. If he has a stroke later, this plan won’t pay another Heart/Stroke benefit. The maximum is a lifetime limit for the category.

It pays for First Diagnosis only. In most states, the plan pays for the first occurrence in your lifetime. A heart attack Marcus had before buying the plan would not count, and neither would any diagnosis made before his effective date.

It has a waiting period and a preexisting conditions limitation. Every plan has a 30-day waiting period after the effective date. The plan also won’t pay for a Qualifying Event caused by, or contributed to by, a Preexisting Condition. That includes a condition you had care, treatment or advice for in the 12 months before your effective date. This limitation lasts no longer than 12 months after the effective date. Marcus’s heart attack came about two years in, so it had already ended. Some states define these terms differently.

Some activities are excluded. The Heart/Stroke, Cancer + Heart/Stroke and Critical Illness plans exclude Qualifying Events connected to certain activities. They include professional or semi-professional sports, skydiving, bungee jumping, scuba diving at 60 feet or deeper, rodeo sports, and racing or speed testing any motorized vehicle. Marcus used to race dirt bikes on weekends. If his heart attack had happened during a race, this exclusion could have applied.

It is not income protection or health insurance. CriticalGuard paid one lump sum. It doesn’t send a monthly check while you’re out of work. It’s a supplement to health insurance, not a substitute, and it isn’t Minimum Essential Coverage under the Affordable Care Act.

Is a plan like this right for you?

The Cancer + Heart/Stroke plan may suit you if:

• You’re self-employed, and an illness would stop both your health and your income.
• You carry a high-deductible health plan and know what your out-of-pocket maximum is.
• You want cancer and heart events each to have their own maximum, so one claim doesn’t use up the other.

Questions worth asking before you apply:

1. What would two or three months away from my business cost, beyond medical bills?
2. What maximum fits my budget? Is $10,000 enough to make guaranteed issue worth it, or do I want more?
3. Do I take part in any of the excluded activities?
4. Would a rider help me? I can only add one when I apply.
5. Is the full-suite Critical Illness plan worth comparing? It adds Advanced Alzheimer’s Disease, ALS, coma, end stage renal failure, loss of independent living and major organ transplant.

Some things are good to know about the policy itself. It is guaranteed renewable for life, as outlined in the policy. It stays renewable until the maximums are paid, premiums go unpaid, you ask to end it, or there is fraud. Premium rates can change. The brochure says they won’t change solely because you made a claim or your health changed, and Nevada policyholders get at least 60 days’ notice of any change. After the policy arrives, you have a 10-day free look in most cases, longer in some states.

This is a fictional illustration. Actual policy benefits, underwriting rules, and availability depend on carrier guidelines and state regulations.