Hospital costs already cause enough stress, Hospital indemnity coverage shifts the focus to healing, not finances. When outpatient surgery or a hospital stay happens, the last thing someone should worry about is how much it will cost to get better. Even with health insurance, premiums don’t cover everything. If an admission to the hospital occurs for a covered accident or sickness, hospital indemnity insurance plans provide benefits that can help pay for hospital expenses that aren’t covered by health insurance. Some options may be offered to those outside of the employer group or who have no medical insurance at all.