Medicare Supplement Plans
What is a Medicare Supplement Plan?
Original Medicare Part A (Hospital) and Part B (Medical) pays for many, but not all health care services and supplies. A Medicare Supplement plan, also called “Medigap” or Med Supp, is an additional insurance sold by private insurance companies that helps cover what Original Medicare doesn’t cover (like copays, coinsurance and deductibles). So, if you have Original Medicare and a Medigap policy, Medicare will first pay its share of the Medicare-approved amount for covered health care costs, then your Medigap policy pays its share, usually covering nearly all of the rest, except a yearly $240 deductible. By adding a supplemental plan to your Original Medicare, you will have as close to complete medical coverage you can get while also having the freedom to choose which doctors and hospitals you want to use! Really! If you want the most comprehensive coverage with the most freedom to choose your doctors and hospitals and are willing to pay a little more premium each month to not have surprise medical bills, than a Medicare Supplement plan is for you!
Now the nitty-gritty! There are 10 Medicare Supplement plans to choose from (Plan A - Plan N) and all of them are standardized by the federal government. Each plan (Plan A - Plan N) offers different benefits and costs. All Medigap plans must cover preexisting conditions after a six-month waiting period. The waiting period does not apply to those who had continuous creditable coverage for six months before enrolling in a Medigap plan.
Medigap policies generally don't cover the cost of dental care, eyeglasses, hearing aids, or private-duty nursing. On the other hand, most Medigap plans cover emergency healthcare during the first 60 days of overseas travel, subject to 20% coinsurance and a $250 annual deductible.
Also note Medicare Supplement (Medigap) only works with Original Medicare Part A and Part B and does not work with Medicare Advantage Plans. Bottom line, if you have a Medicare Advantage plan, you do not need a Medigap policy and vice-versa.
Why Should I Consider a Medicare Supplement Plan?
One of the biggest positives about having a Medigap policy with Original Medicare is the freedom to go to any doctor you want without a referral (unlike Medicare Advantage plans where you have to see in-network doctors and get referrals to have the services fully covered). And when you have a Medigap policy, nearly all of your costs are paid except for the yearly $240 deductible is paid! Bottom line, Medigap is great if being able to choosing who your doctors are or what hospitals you go to is important to you, don’t want surprise medical bills and are willing to pay a higher monthly premium for that financial peace of mind.
Types of Medicare Supplement Plans
Currently, there are 10 types of Medigap policies to choose from. Here is a chart showing what the plans cover. 95% of our clients choose plan G or plan N as they give the best bang for your buck. As with anything, each plan has its pros and cons and when we talk, we will go into detail about these and which plan is right for your specific needs.
Frequently Asked Questions About Medigap Plans
Can I switch to Medicare Advantage Plan if I do not like Original Medicare with a Medigap policy?
Yes. You can switch from Medigap to Medicare Advantage during the Medicare Annual Enrollment Period (AEP) from October 15th to December 7th or if you are eligible for a Special Enrollment Period (SEP).
Do Medigap policies cover prescription drugs?
Medigap policies don’t offer prescription drug coverage. If you want prescription drug coverage (which you should get to avoid a penalty), you must get a stand-alone Medicare Prescription Drug Plan (Part D) that works with Original Medicare (which we can help you with).
Can the insurance company cancel my Medigap policy?
Any Medigap policy is guaranteed renewable even if you have health problems. This means the insurance company cannot cancel your policy if you pay your premiums.