By Chris Cordon

Most people believe health insurance is the thing that protects them from financial ruin.

Then they read the fine print the hard way.

The most-cited study of medical bankruptcy in this country found that nearly 8 in 10 of the people it wiped out had health insurance when they got sick. (American Journal of Medicine, 2009.) A decade later, two-thirds of all U.S. bankruptcies were still tied to medical bills or illness-related lost income. (American Journal of Public Health, 2019.)

Read that again. Not the uninsured. The insured. People who did everything right, paid their premiums, carried the card in their wallet, and still ended up in front of a bankruptcy judge.

And it isn’t an old story. Among cancer patients carrying medical debt today, 98% had health insurance when they ran it up. (American Cancer Society Cancer Action Network, 2024.)

How does that happen?

The Gap Your Plan Leaves Behind

Health insurance has a deductible. You knew that. What people underestimate is how big the hole is before the plan pays for much of anything.

The average deductible at a small business is now $2,575 for single coverage. Nationwide, nearly a third of covered workers face a deductible over $2,000, roughly double the share a decade ago. (KFF, 2024.)

So you get sick. Or you get hurt. The treatment starts. And the first few thousand dollars are entirely yours, before insurance meaningfully kicks in. Then coinsurance. Then the out-of-pocket maximum, which on a family plan can sit north of $18,000.

That’s the gap. It’s real money, it’s owed fast, and your health insurance is doing exactly what it promised while you write the checks.

The Bills That Aren’t Even Medical

Now add the costs no health plan was ever going to touch.

The mortgage still comes due. So does the car payment, the electric bill, the groceries. If the illness keeps you from working, the income shrinks at the exact moment the bills grow.

Then the quiet ones. Gas and hotels for treatment three hours away. Childcare while you’re in the hospital. The co-pays that repeat every single week.

It adds up to something staggering. More than 40% of cancer patients drain their entire life savings within two years of a diagnosis. The average loss: about $92,000. (American Journal of Medicine, 2018.)

Their insurance was working the whole time. It just wasn’t built to cover any of that.

It’s Not a Rare Event

This is where people tell themselves it won’t be them.

The odds say otherwise. About 4 in 10 Americans will be diagnosed with cancer at some point in their lives. (American Cancer Society.) Heart disease is still the country’s number one killer, behind roughly one in five deaths. (CDC.)

These aren’t freak occurrences. They’re the most common things that happen to ordinary people. And the financial damage doesn’t wait for the diagnosis to turn dire. A ground ambulance ride often runs $900 or more, and it isn’t protected by the federal surprise-billing law, so even insured patients can get handed the full bill. A single ER trip routinely leaves an insured family hundreds of dollars lighter, and often more than a thousand.

Where Cash is King

So, let’s walk through something that should be obvious. When you go through something bad, cash is king. More than likely you’re about to go through something physically exhausting, emotionally draining. It doesn’t need to be financial. And when a family member goes through something severe, the entire family faces it with them. Nieces, nephews, and children will shave their head in solidarity with a parent or family member going through chemo. The entire world stops spinning when a loved one is in the intensive care unit.

It’s cash. Money that shows up fast, with no rules about how it gets spent.

That’s the whole point of Accident, Hospital, and Critical Illness coverage. They aren’t health insurance. They sit beside it. When you land in a hospital bed, or get handed a diagnosis, they pay a lump sum of cash directly to you. Not to the hospital. To you.

You decide what it’s for. The deductible. The mortgage. The plane ticket. The week of groceries while you’re not earning. It fills the exact gap that sinks insured families.

What ASA Members Can Do

Two honest questions.

First: if I got seriously sick or hurt tomorrow, how much would I owe before my health insurance paid a dime? Find your deductible and your out-of-pocket maximum. That number is your exposure.

Second: where would that cash come from? Savings? A credit card? A fundraiser? If the answer makes you uneasy, that’s the gap these plans are built to close.

Good health insurance is necessary. It was simply never designed to keep a family solvent through a catastrophe. American Subcontractors Association members can look at supplemental cash coverage through The ASAdvantage Health Plan, which is a sensible place to start.

Insurance pays the hospital. Cash protects the family. Those are two different jobs.

Chris Cordon was a Benefits Consultant at Affinity Benefits, the program administrator for The ASAdvantage Health Plan. For questions about the ASAdvantage Health Plan, please contact Sandra Midtlien at smidtlien@affinitybenefits4u.com