Which Medicare supplement plan do I need?
Medicare supplement plans are sold by private health insurance companies and can help you pay some of the medical expenses that original Medicare doesn’t cover, such as co-payments, co-insurance, and deductibles. Medicare supplement plans are also referred to as Medicare supplemental insurance or Medigap. They consist of eight standardized plan options A, B, D, G, K, L, M and N and are provided by private insurance companies that must be approved by Medicare. Every Medigap policy must adhere to federal and state regulations, designed to protect you, the consumer. This means, no matter where you buy a Medicare supplement plan and which insurance company you purchase the plan from, your policy will have the exact same basic benefits (except in Massachusetts, Minnesota, and Wisconsin, where Medigap policies are standardized differently). In some states, you will find a specific type of supplemental policy called ‘Medicare SELECT’.
While you will find in most states Medigap Plan A, you may not find each of the eight plans offered in your local area, as each insurer is free in which Medigap policies they offer. To find a Medicare supplement plan that is available to you, you may use the plan finder at Medicare.gov.
What do Medicare supplement plan policies cover?
The greatest advantage of Medicare supplement policies is that they help you with co-payments and with acute care procedures which are not covered by original Medicare Part A and B. Each of the standardized policies offers different benefits at different costs, so you can select the Medigap plan that best meets your individual health care and financial needs. Some even add coverage for medical services which are not covered by original Medicare. None of the Medigap plans however includes prescription drug coverage, so you need to add a ‘Medicare Part D’ plan to help you with the cost for prescribed medication.
How do Medicare supplement plans work?
A Medigap policy supplements your Medicare benefits. When you add a Medicare supplement plan to your original Medicare Part A and B, and go to the doctor or a hospital that accepts Medicare, Medicare will first pay its share of the Medicare-approved amount for covered health care costs. Your Medicare supplement plan provider will then pay its share, as far as it is included in your policy. This means that they “accept assignment” for all Medicare patients. If your doctor participates, the Medigap insurance company is required to pay the doctor directly if you request.
As long as you pay your monthly premium, the insurance company cannot cancel your policy, even if you develop serious health problems.
When can I buy a Medicare supplement plan?
In order to add supplemental insurance to your Medicare, you must have Medicare Part A and B. As a policy only covers one person, you and your spouse each have to buy separate policies. You can add supplemental insurance during the first 6 months after you are eligible for Medicare, usually at your 65th birthday. If you miss this ‘initial enrollment period’, the insurance company can use underwriting, which means your medical history will be considered, and you may be turned down, or have to pay a higher premium.
Where can I buy a Medicare supplement plan?
You can purchase a Medigap policy from any insurance company which offers that plan in your state.
What do Medicare supplement plans cost?
In addition to the monthly Part B premium that you pay have to pay to Medicare, you have to pay a monthly premiums for a Medigap policy. The premium is set by the insurance company you select. The amount of co-payments and deductibles (if any) depend on the plan you select.
Medicare supplement plans vs Medicare advantage plans
Depending on the Medigap plan you select (A, B, D, G, K, L, M or N), supplemental insurance covers most of your gaps in Medicare. On average and in most states, you will find plans at a monthly premium that is most likely more expensive than most Medicare advantage plan premiums. However, contrary to Medicare advantage plans where you typically are required to select your health care provider from the plan’s network, you may visit any doctor or facility that accepts Medicare. Which option is better for you depends on your individual medical and financial needs.
Medicare supplement plans and prescription drug coverage
Medicare supplement plans do not include prescription drug benefits. You will need to add a stand-alone Medicare Part D prescription drug plan to insure prescription medication.
How to compare Medicare supplement plans
Each insurance company is free to set their own premium for the exact same policy. Comparing Medicare supplement plans is easy as you are comparing the same benefits (for example, Plan A offered by one insurer must have the same benefits as Plan A offered by another insurance company), so you can select the insurance company that offers a plan for the lowest premium. Make sure, however, to purchase from a company that has good reputation and customer service.
