Medicare Supplement Plans
What is a Medicare Supplement Plan?
A Medicare Supplement plan, also referred to as Medigap, is a health insurance policy sold by private insurance companies to fill the gaps in Medicare Parts A and B.
Why Enroll a Medicare Supplement?
Many Medicare beneficiaries don’t realize that Original Medicare doesn’t pay for all of your medical expenses. While Original Medicare does provide comprehensive health coverage, you are still responsible for copays, coinsurance and deductibles.
It is often overlooked that there is no out-of-pocket spending limit for Medicare covered services when using Original Medicare benefits without a Medicare Supplement plan.
For example, after your Part B deductible, you are responsible for 20% of covered services. This 20% coinsurance has no limit. This means you are exposed to unlimited claims cost-sharing.
Enrolling in a Medicare Supplement will help cover the 20% of Part B, as well as expenses associated with Part A.
A Closer Look at Medicare Supplement
Medicare Supplement plan eligibility includes:
✓ you must have Parts A and B to enroll in a Medicare Supplement policy
✓ your Medicare Supplement policy must be guaranteed renewable
✓ you cannot pay for your Medicare Supplement out of SSA
A Medicare Supplement plan can cover some or all of the following:
✓ Medicare Part A and B deductibles
✓ Medicare Part A coinsurance and hospital costs (up to an additional 365 days after Medicare benefits are used)
✓ Medicare Part B coinsurance or copayment
✓ Blood (first 3 pints)
✓ Part A hospice care coinsurance or copayment
✓ Skilled nursing facility care coinsurance
✓ Part B excess charges
✓ Coverage for emergency services while traveling overseas, which aren’t covered under Medicare
When deciding to enroll in a Medicare Supplement, you have decided to have all of your medical coverage by Medicare-approved providers. Under this arrangement, Medicare will pay first, and your supplement will pay second. After Medicare processes a claim for covered services, the balance of your bill will be sent to your Medicare Supplement plan for secondary payment.
Note: Remember that whichever supplement plan you choose, Original Medicare remains the primary payer for all covered claims.
There are a number of Medicare Supplement options available to you nationwide. Each plan is identified by a letter: A, B, C, D, F, G, K, L, M and N. Since 2011, all Medicare Supplement plans have been standardized. This means a selected plan will have the same benefits regardless of where you live or the insurance provider you choose.
It is important to understand your premiums and out-of-pocket costs associated with the available Medicare Supplement plans.
When To Enroll in a Medicare Supplement Plan
The ideal time to enroll in a Medicare Supplement plan is during your Medicare Supplement Open Enrollment period. This enrollment period begins the first day of the first month in which you’re 65 or older and enrolled in Medicare Part B.
The importance of this enrollment period is that you can secure a Medicare Supplement policy without any medical underwriting. This means that the insurance company can’t deny you coverage or rate up your premium due to pre-existing health conditions. if you have pre-existing conditions, you will not be penalized, rated or denied coverage during this enrollment period.
Should you miss this enrollment period, applying for a new policy will subject you to medical underwriting.
You can not have a Medigap policy as well as a Medicare Advantage plan at the same time.
Some Tips About Medigap Policies
Medigap policies are pretty straight-forward, but there are a number of specific rules that apply when enrolling in this type of coverage. Here are some tips that are helpful to know about Medigap policies, but call us at 703-214-4600 if you’d like more information.
- In order to purchase a Medigap policy, you must have Medicare Part A and Part B.
- If you are currently enrolled in a Medicare Advantage Plan, you can apply for a Medigap policy, but make sure you can disenroll from the Medicare Advantage Plan before your Medigap policy begins.
- Your monthly premiums for a Medigap policy are paid to a private insurance company and are in addition to the monthly Part B premium that you pay to Medicare.
- A Medigap policy is issued to a single beneficiary. If you and your spouse both want a Medigap policy, you will each have to purchase separate policies.
- You can buy a Medigap policy from any insurance company that is licensed in your state to sell one.
- Any standardized Medigap policy is guaranteed renewable even if you have health problems. Guaranteed renewable simply means that the insurance company cannot cancel your Medigap policy as long as you pay the premium.
- Some Medigap policies sold in the past combined medical and prescription drugs benefits. All Medigap policies sold after January 1, 2006, aren’t allowed to include prescription drug coverage. If you want prescription drug coverage, you should consider joining a Part D plan.
- If you have a Medicare Medical Savings Account (MSA) Plan, it is illegal for anyone to sell you a Medigap policy.
Need Additional Coverage?
Want to explore your Medicare Supplement options? Contact us and we can assist you in finding the right plan.
