Medicare Supplements, also known as Medigap policies, are insurance plans offered by private insurance companies to fill the “gaps” in Original Medicare (Part A and Part B) coverage. These gaps refer to out-of-pocket costs like deductibles, coinsurance, and copayments that beneficiaries would otherwise have to pay themselves.

Here’s a breakdown of Medicare Supplements:

  • Purpose:
    • The primary aim of a Medigap policy is to help pay for certain costs that Original Medicare doesn’t cover. This can make healthcare expenses more predictable and manageable for beneficiaries.
  • Types:
    • There are 10 standardized Medigap plans available in most states, identified by letters A, B, C, D, F, G, K, L, M, and N. (Note: Plans C and F are not available to people who were newly eligible for Medicare on or after January 1, 2020.)
    • Each lettered plan offers a different set of benefits but is standardized, meaning the benefits for a Plan G, for example, are the same regardless of the insurance company or location (with some variation in Massachusetts, Minnesota, and Wisconsin).
  • Coverage:
    • Depending on the Medigap plan chosen, coverage might include:
    • Part A deductible and coinsurance
    • Part B deductible and coinsurance or copayments
    • Blood (first 3 pints each year)
    • Hospice care coinsurance or copayment
    • Skilled nursing facility care coinsurance
    • Foreign travel emergency coverage (up to plan limits)
  • Some plans also offer an out-of-pocket maximum, which can provide additional financial protection.
  • Cost:
    • Beneficiaries pay a monthly premium for their Medigap policy in addition to the monthly Part B premium.
    • Premiums can vary widely based on several factors, including age, location, and the insurance company.
  • Enrollment:
    • The best time to buy a Medigap policy is during the 6-month Medigap open enrollment period, which starts the month a person turns 65 and is enrolled in Medicare Part B. During this period, an insurance company can’t use medical underwriting, meaning they can’t charge more or deny coverage based on health status.
    • If trying to buy or switch Medigap policies after this period, the insurance company may use medical underwriting.
  • Medicare Advantage vs. Medigap:
    • It’s essential to understand that Medigap policies supplement Original Medicare. If a beneficiary is in a Medicare Advantage Plan (Part C), they can’t use a Medigap policy to pay for expenses. In fact, it’s illegal for someone to sell you a Medigap policy if you’re in a Medicare Advantage Plan, unless you’re switching back to Original Medicare.
  • Guaranteed Renewability:
    • Medigap policies are guaranteed renewable, meaning as long as you pay the premium, the insurance company can’t terminate the policy even if health problems arise.

When considering a Medigap policy, it’s essential to compare the various plans and understand what each plan covers. Beneficiaries should also review their needs annually, as healthcare needs and available policies may change over time.