Medicare Supplement Guide

Sherrie Johnson Sherrie became a professional writer in 2014. An expert in all things Medicare, you can find her work across a number of publications. When she’s not writing, you can find her fixing up her farm in Kentucky where she lives with her husband.
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Exploring Medicare Supplement Plans 

If you’re getting ready to blow out the candles on your 65th birthday cake, selecting a Medicare plan should be at the top of your list. But with all the options, what do you choose? And is Original Medicare all you need? While Original Medicare covers hospital and medical visits, Medicare Supplement assists with the additional health care costs that Original Medicare doesn’t cover, such as copayments, coinsurance, and deductibles. Read on for a comprehensive guide to understanding Medicare, Medicare Supplement plans, and discovering which one is right for you. 

In this article, we will cover:

  1. What is Original Medicare and What Does it Cover?
  2. What is Medicare Supplement (Medigap)?
  3. What Does Medigap Cover?
  4. How Do Medigap and Medicare Advantage Compare?
  5. How Do I Apply for Medigap?
  6. Can You Wait to Purchase a Plan?
  7. How Much Does Medigap Cost?

What is Medicare Supplement?

Medicare Supplement plans are also known as Medigap plans. Medigap plans are sold by private companies and designed to help pay for health care costs that Original Medicare doesn’t cover. While Medicare Parts A and B cover hospitalization and doctor visits, many out-of-pocket expenses—such as copayments, coinsurance, and deductibles—are not covered. This is where Medicare Supplement comes into play. When enrolled in both Original Medicare and Medicare Supplement, each will pay its share of covered health care costs. As Medicare Supplement plans assist with additional costs that Original Medicare doesn’t cover, this means most out-of-pocket costs that arise after a medical emergency will be covered. Essentially, as Part B only covers 80% of your fees, Medicare Supplement assists with the last 20%. With Medicare Supplement, you don’t have to worry about paying additional fees when recovering.

What You Need to Know About Medigap

When enrolling in a Medicare Supplement plan, it’s important to be knowledgeable about the basics of Medigap and each specific policy. Here are important factors about Medigap you should note: 

  • You must be enrolled in Original Medicare to purchase a Medigap plan. Medigap works alongside Original Medicare.
  • You cannot purchase a Medigap plan if you have a Medicare Advantage plan (also known as a Medicare Part C).
  • With a Medigap plan, you pay a monthly premium in addition to your premium for Medicare Parts A, B, and D.
  • Each Medigap policy covers one person. This means you and your spouse will need separate policies.
  • Medigap plans are standardized health insurance plans, issued by private insurance companies and endorsed by the U.S. government.
  • Like other types of Medicare plans, Medigap options are labeled by the letters of the alphabet. 
  • There are ten standardized Medigap plans. Standardized plans are the same in all 50 states. In other words, Medigap Plan A in California provides the same coverage as Medigap Plan A in Florida.
  • Insurance companies cannot change Medigap policies, but they can charge different premiums, so be sure to shop around.

Note: If you live in Minnesota, Wisconsin, or Massachusetts, plans will look different for you. It’s best if you check with a licensed professional to better understand your state’s healthcare marketplace and for up-to-date information on plans and pricing.

What Is Not Covered By Medigap?

As when choosing which Medicare plan to enroll in, it’s always important to know what is and isn’t covered in each policy. Again, in order to qualify for Medigap, you need to be enrolled in Original Medicare. As previously stated, Medical Supplement covers many of the additional costs associated with Original Medicare, such as copayments, coinsurance, and deductibles.

Medigap policies do not include the following:

What Are My Medicare Supplement Options?

Here is a quick breakdown of the most popular Medigap options:

PLAN COVERAGE
Plan B
  • Basic benefits
  • Medicare Part A deductible
  • Medicare Part B coinsurance
  • Preventative Part B coinsurance
Plan D
  • Basic benefits
  • Medicare Part A deductible
  • Medicare Part B coinsurance
  • Preventative Part B coinsurance
  • Skilled nursing
  • Foreign travel emergency
Plan G
  • Basic benefits
  • Medicare Part A deductible
  • Medicare Part B coinsurance
  • Preventative Part B coinsurance
  • Skilled nursing
  • Foreign travel emergency
  • 100% Medicare Part B Excess
Plan M
  • Basic benefits
  • 50% Medicare Part A deductible
  • Medicare Part B coinsurance
  • Skilled nursing
Plan N
  • Basic benefits
  • Medicare Part A deductible
  • Medicare Part B coinsurance with a copay
  • Preventative Part B coinsurance
  • Skilled nursing
  • Foreign travel emergency

What’s the Difference Between Medigap and Medicare Advantage? It’s important to note that you legally cannot be enrolled in both Medicare Advantage (Medicare Part C) and a Medical Supplement plan (Medigap). Medicare Advantage is an alternative to Original Medicare, while Medigap supplements your Original Medicare. The chart below compares Medigap and Medicare Part C.

  Medicare Advantage (Part C) Medicare Supplement a.k.a. Medigap
Access to Doctors
  • Must be within HMO/PPO Network
  • Any doctor that takes Medicare
Costs
  • Lower premium, higher out of pocket costs
  • Higher premium,
  • lower out of pocket costs
Geographic Coverage
  • Localized to a specific region
  • Coverage available in all 50 states + foreign travel

 How Do I Apply for Medigap?

First, you must be enrolled in Original Medicare Medicare Part A and B. This applies to each person. If both you and your spouse want coverage, you must each apply for a Medicare Supplement plan.

Next, you’ll want to look at the calendar.

The federal government gives you a six-month window to apply for a Medigap plan with guaranteed acceptance. Apply in that window, and you will be accepted even if you have a preexisting condition.

Your six-month window begins on the first day of the month you turn 65 and apply for Part B. For example, if your birthday is May 25, then you have six months to sign up starting from May 1. Your enrollment period ends on December 1.

Note: If you have insurance through your employer, you can enroll when you apply for Part B.

Can You Wait to Purchase a Medigap Plan?

Must you purchase a plan if you’re healthy and don’t see a need? What if you miss your enrollment window? 

You can still apply, but insurance companies don’t have to accept you. Applying after your enrollment window permits insurance companies to ask health questions. At this point, they are allowed to deny you coverage due to health issues like preexisting conditions. Enrolling during your six-month enrollment period is vital for guaranteed Medical Supplement coverage.

Bottom Line: It’s smarter to apply even if you’re healthy. If you wait until you’re sick, you may get denied.

How Much Does Medigap Cost?

While specific costs will vary by policy, when you have a Medigap plan, you pay a monthly premium for your supplemental coverage in addition to the premiums you pay for Medicare Parts A, B, and D.

Note: As long as you pay monthly premiums, your Medigap policy will be yours for life.  You cannot be fazed out or denied your Medigap insurance. A few states may refuse to renew a Medigap policy purchased before 1992.  All policies after that date are guaranteed to renew each year automatically.

 

 

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