Medicare Supplements, also known as Medigap, is health insurance sold by private health insurers. The plans are designed to be paired with Original Medicare (Medicare Part A and Part B) to fill in the gaps left behind by Medicare, such as deductibles, coinsurance, and copays. Many Medicare beneficiaries like Medigap because it helps protect them from high medical expenses.
Read on to learn how Medicare Supplement plans work.
How Medicare Supplement Plans Work
You can’t purchase this plan unless you are already enrolled in Original Medicare. Medicare Supplement plans are sold by private insurance companies approved by Medicare, with up to 10 plans available for Medicare beneficiaries in most states. The Medicare Supplement plans are labeled as A, B, C, D, F, G, K, L, M, and N. The plans vary in their coverage and have different levels of coverage for the following benefits listed below:
- Medicare Part A deductible
- Medicare Part A hospital coinsurance
- Medicare Part B copayment or coinsurance
- The first three pints of blood
- Medicare Part A hospice care copayment or coinsurance
- Skilled nursing facility care coinsurance
- Medicare Part B deductible
- Medicare Part B excess charges
- Foreign travel emergencies
Even though the plans are sold by private insurance companies, the policies are standardized. For instance, a Medicare Supplement Plan N in California provides the same coverage as a Medicare Supplement Plan N right here in Texas – the only difference will be the insurance company and the plan’s pricing.
Note that if you didn’t qualify for Medicare before January 1, 2020, you cannot purchase Medigap Plan C or Plan F. These Medicare Supplement plans are no longer available to new Medicare beneficiaries, but you can keep the plan if you are already enrolled. Also, you cannot buy a Medicare Supplement Plan if you already have coverage through Medicare Advantage. Also, the plans only provide coverage for an individual — not a married couple.
It is also important to know that you have a one-time enrollment (Medicare Supplement Open Enrollment Period) opportunity after you turn 65 and first sign up for Part B to enroll in a Medicare Supplement plan. During this six-month period, you can purchase a Medigap plan and not have to worry about being accepted. This is called a guaranteed issue right. However, suppose you decide not to enroll during this period. In that case, you could be turned down for coverage or charged more and put through medical underwriting.
Nonetheless, once you’re enrolled in a Medicare Supplement plan, you will receive coverage for any Medicare-approved facility. Once you receive your care, Original Medicare will first provide its coverage. After that share is paid, the rest will then be given to your supplement plan. Your supplement plan will cover up to its limits, which could be some, most, or all of the costs, depending on the plan you chose. Then, whatever costs are left over will be up to you to pay.
You are also required to pay a monthly premium for a Medigap plan. You will pay your Medicare Supplement plan separately from any Medicare monthly premium. The costs for a Medigap plan also vary depending on the private insurance companies you got your policy from. However, in general, there are three ways in which Medicare Supplement plans are priced: community-rated, issue-age-rated, and attained-age-rated.
Before making any final decisions regarding Medigap plans, you may want to speak to a Medicare expert at Vic 4 Insurance to compare your options and make sure the plan is affordable. Get in touch with us today!