A Medicare supplement insurance plan is sold by private companies. It can help pay some of the health care costs that Original Medicare doesn’t cover, like copayments, coinsurance, and deductibles. Some policies also offer coverage for services that Original Medicare doesn’t cover, like medical care when you travel outside the U.S.A Medigap policy is different from a Medicare Advantage Plan. Advantage plans are ways to get Medicare benefits, while a Medigap policy supplements your Original Medicare benefits.
If you have Original Medicare and you buy a Medigap policy, Medicare will pay its share of the Medicare-approved amount for your covered health care costs.
Then your Medigap policy pays its share.
A Medigap plan and a Medicare supplement are one in the same. They are two names for the same thing. So when you see the words “Medicare supplement, it is interchangeable for the word “Medigap”. These plans are also called “Medicare Supplemental Insurance”
There are 10 standardized Medicare supplement plans available in most states. In Massachusetts, Minnesota, and Wisconsin, Medigap policies are standardized in a different way. The plan names are letters of the alphabet, plans A, B, C, D, F, G, K, L, M, and N.
The chart below will compare Medicare supplement plans by showing basic information about the different benefits that Medigap policies cover. If a check mark appears, the plan covers the described benefit 100%. If a percentage appears, the plan covers that percentage of the benefit.
Even though Medigap plans are run by private companies such as Blue Cross, United Healthcare, or Humana, every Medigap policy must be standardized and must follow Federal and state laws.There are multiple “F” plans offered by multiple companies, but they’re all exactly the same plan by Medicare rule. This makes it easy to compare “F” plans between two companies, since they are the exact same coverage but not necessarily the same price. To clarify further still, that means that each private company that offers a certain plan has to offer the exact same benefits as their competition. The same can be said for the “N” plans, the “C” plans, and so on.
Each insurance company decides which Medigap policies it wants to sell, although state laws might affect which ones they offer. Insurance companies that sell Medigap policies:
With a Medicare supplement policy (Medigap) you can go to any doctor, or other health care provider, anywhere in the United States, as long as that doctor or provider accepts Medicare.
A good starting point to compare Medicare supplement plans is Medicare’s online plan finder tool.
Here are some other important facts you must know:
Insurance companies set prices for Medigap policies in 1 of 3 ways:
Regardless of which type of pricing your Medigap insurer employs, the price will most likely increase each year because of inflation and rising health care costs.
As a general rule of thumb, premiums that are based on both age and increased medical costs typically increase faster and at a steeper rate than other premiums.
Below, as an example, you will see Plan F and Plan N premiums for 5 popular insurance companies that offer a Medicare supplement plan. The first one shows the monthly premium at age 65 and the second shows those rates for someone age 70.
These are sample rates for the San Francisco area:
In addition, you must still pay your Medicare Part B monthly premium (134 in 2017)).
In most states, there is a “guaranteed acceptance” or “open enrollment” period during these specific times:
This means the insurance company can’t do any of these because of your health problems:
If you are older than age 65, and the open enrollment period does not apply, you may still apply for a Medicare supplement. You will need to answer some medical questions in order to be accepted in a plan.
While the insurance company can’t make you wait for your coverage to start if you qualify for guaranteed acceptance, it may be able to make you wait for coverage related to a pre-existing condition.
A pre-existing condition is a health problem you have before the date a new insurance policy starts.
In some cases, the Medigap insurance company can refuse to cover your out-of-pocket costs for these pre-existing health problems for up to 6 months. This is called a “pre-existing condition waiting period.” After 6 months, the Medigap policy will cover the pre-existing condition.
Coverage for a pre-existing condition can only be excluded in a Medigap policy if the condition was treated or diagnosed within 6 months before the date the ” existing condition waiting period, the Medigap policy will cover the condition that was excluded.
Keep in mind, though, for Medicare-covered services, Original Medicare will still cover the condition, even if the Medigap policy won’t cover your out-of-pocket costs, but you’re responsible for the Medicare coinsurance or copayment.
As we mentioned earlier, Medicare Part A and Part B, along with a Medicare supplement will cover most or all of your Medicare approved medical costs except prescription drugs.So, when you choose to purchase a Medicare supplement policy, you would most likely enroll in a Prescription Drug Plan (Medicare Part D) as well.
Since January 1, 2006, prescription drug plans (Medicare Part D) have been available to everyone with Medicare. If you decide not to join a Medicare Prescription Drug Plan when you’re first eligible, and you don’t have other creditable prescription drug coverage, or you don’t get Extra Help, you’ll likely pay a late enrollment penalty.
To get Medicare drug coverage, you must join a plan run by an insurance company or other private company approved by Medicare. Each plan can vary in cost and drugs covered.
In general, Medicare Part D covers the cost of prescription drugs. The amount of coverage will depend on the drugs you take, and whether or not you are in the Coverage Gap (donut hole), or in Catastrophic Coverage. To get complete information on prescription drug plans, and to determine which plan is right for you, visit our Prescription Drug Plans page or Contact us.
Contact us to find out what your cost would be and help with choosing the right plan.