Sometimes a healthcare bill is bigger than you expect. Someone in your family might need to go to the emergency room or a doctor might order tests.

A fixed indemnity plan is built for moments like this. It works alongside your main health insurance plan. It doesn’t replace it.¹ It's considered supplemental insurance, and there’s a monthly premium for supplemental insurance that isn’t included in what you’d pay for your primary health insurance.

Fixed indemnity insurance pays a set, or “fixed,” amount for a covered health service, such as a hospital stay or a doctor visit. This amount stays the same regardless of the size of the bill. It also doesn’t matter if the provider is in or out of network. Here are five common ways you can use these benefits to help cover out-of-pocket costs.

1. Reduce the impact of a large deductible

Health insurance deductibles have been rising in recent years. In 2025, the average deductible for single coverage was $1,886, up more than 15 percent over five years. More than a third of covered workers now have a deductible of $2,000 or more.²

Deductibles are costs that you need to cover before your health insurance plan begins to pay for covered services. A fixed indemnity insurance plan can help with those out-of-pocket costs. You can use the benefits to help pay your deductible, coinsurance or other costs.

Depending on your plan, you may receive benefits for covered health services such as doctor visits or prescription medications. Your policy lists each payout amount ahead of time, so you’ll know what to expect.

Could a fixed indemnity insurance plan help you pay for your healthcare costs? Explore plans online to learn more.

2. Help manage hospital-related costs

A hospital stay can bring bills that add up fast, even with a health insurance plan in place. A fixed indemnity insurance plan pays a set benefit for covered services, such as a hospital admission or a surgery.

Here’s an example of how a fixed indemnity insurance plan that includes hospital coverage could help after an emergency surgery. The fixed indemnity plan benefits may include:

This payment of $10,800 would be in addition to any healthcare coverage your main health insurance plan provides. The benefit payment doesn’t depend on the size of the bill. If your health insurance covers most of your surgery, you can use the money to cover other expenses.

3. Help pay for recovery and follow-up care costs

Costs don’t stop once you leave the hospital. Follow-up visits, physical therapy and recovery care can add to your bill. A fixed indemnity plan may help pay for these out-of-pocket costs.

The benefit isn’t limited to medical bills, either. If a payout covers more than your recovery-related costs, you can put the rest toward everyday expenses while you recover, such as rent, gas or groceries.

4. Supplement a high-deductible health plan (HDHP)

A high-deductible health plan, often called an HDHP, usually has a lower monthly premium but a higher deductible than other health insurance plans. A fixed indemnity plan can help with that trade-off.

It doesn’t replace your major medical insurance plan, and it isn’t considered minimum essential coverage under the ACA.³

Fixed indemnity insurance can help you pay for your deductible and other healthcare costs before your health insurance plan begins to pay for covered services.

Thinking about pairing a fixed indemnity plan with an HDHP? Explore plans online.

5. Provide financial flexibility during a health event

A fixed indemnity benefit is tied to the covered services. This means your benefit could be more or less than your bill. If it’s more, you’ll have extra money to put toward other expenses. If it’s less, you’ll have the money to help cover part of a larger expense.

Keep in mind that when it comes to your main health insurance plan, there are also ways you may be able to lower your expenses. These may include using an in-network doctor or a participating pharmacy. A fixed indemnity plan can help you cover the additional costs. This combination of a set benefit and potential in-network savings can add real flexibility when an unexpected health event occurs.

Frequently asked questions

What is fixed indemnity insurance, and how does it differ from traditional health insurance?

Traditional health insurance pays for covered healthcare services once you meet your deductible. A fixed indemnity plan works differently. It pays you a set, flat amount for a covered event, like a hospital day. It pays this amount no matter what the bill is or what your main health insurance plan covers. It’s a benefit that arrives alongside your regular health insurance coverage, not in place of it.

Can I use a fixed indemnity plan instead of a major medical insurance plan?

No. A fixed indemnity plan is limited-benefit supplemental insurance. It is not a full health insurance plan. It doesn’t meet the ACA’s rules for minimum essential coverage. It can’t replace a major medical insurance plan. It’s built to supplement, or work alongside one.

How exactly does fixed indemnity help with out-of-pocket costs?

A fixed indemnity plan pays a set benefit for a covered healthcare service. You can use the payment to help cover out-of-pocket costs, such as deductibles, coinsurance or other expenses. The amount paid depends on the terms of your policy and the covered service received.

Do I have to spend the indemnity benefit strictly on medical bills?

No. Benefits are often paid to you, not your provider, unless you have assigned your benefits to the provider or hospital. You can spend that benefit on medical bills. Or you can use it for daily costs, like rent, utilities and groceries, while you recover.

Does a fixed indemnity plan pay benefits even if I have other health insurance?

A fixed indemnity plan can pay benefits for covered healthcare services even when you have a major medical insurance plan. The benefit amount is based on your policy, not on what your primary health insurance plan pays. Check your policy documents for details about covered services and benefit amounts.

Wondering if a fixed indemnity plan might fit your needs? Call a licensed insurance agent at 1-800-273-8115 or explore plans online.

For informational purposes only. This information is compiled by UnitedHealthcare, and/or one of its affiliates, and does not diagnose problems or recommend specific treatment. Services and medical technologies referenced herein may not be covered under your plan. Please consult directly with your primary care physician if you need medical advice.

Sources:

1. UHOne. “How does a fixed indemnity plan work?” Accessed July 22, 2026. Retrieved from https://www.uhone.com/resources/articles/hospital-and-doctor/how-fixed-indemnity-insurance-works

2. KFF. “2025 Employer Health Benefits Survey.” October 22, 2025. Retrieved from https://www.kff.org/health-costs/2025-employer-health-benefits-survey/

3. HealthCare.gov. “Minimum Essential Coverage.” Accessed July 22, 2026. Retrieved from https://www.healthcare.gov/glossary/minimum-essential-coverage/

Part Number: 53408-X-0826