If you’re approaching the age of 65 or have already enrolled in Medicare, you may have heard about Medicare Supplement Insurance, also known as Medigap. This type of insurance is designed to help cover some of the out-of-pocket costs associated with Medicare, including deductibles, copayments, and coinsurance. In this blog, we’ll provide a comprehensive guide to what Medicare Supplement Insurance is, how it works with Part D of Medicare, and how you can choose the right plan for your needs.
What is Medicare Supplement Insurance?
Medicare Supplement Insurance is a private health insurance policy that helps cover some of the costs that Original Medicare doesn’t pay for. There are ten standardized Medigap plans available in most states, each labeled with a letter from A to N, together with two high-deductible versions of plans F and G. Medigap plans vary in their coverage levels and premiums, but all offer some basic benefits, such as coverage for Medicare Part A and B coinsurance and copayments.
One of the main benefits of Medicare Supplement Insurance is that it can help protect you from unexpected healthcare costs. When you have a Medigap policy, you’ll generally pay lower out-of-pocket costs for covered services than you would with Original Medicare alone. But have in mind, you cannot have a Medigap policy and be enrolled in Medicare Advantage at the same time, so make a calculated decision on what best suits your health situation.
How Does Medicare Supplement Insurance Work with Prescription Drugs?
While Medicare Supplement Insurance is designed to help cover costs associated with Original Medicare, it doesn’t include prescription drug coverage. For that, you’ll need to enroll in a separate Medicare Part D plan, which covers the cost of prescription medications.
If you’re enrolled in a Medicare Supplement Insurance plan and a Medicare Part D plan, your Medigap policy will work alongside your Part D coverage. Medigap plans don’t cover prescription drugs, but they can help pay for some of the out-of-pocket costs associated with Part D, such as deductibles and coinsurance.
Choosing the Right Medicare Supplement Insurance Plan
When it comes to choosing a Medicare Supplement Insurance plan, it’s important to understand your options and what each plan covers. While all Medigap plans offer some basic benefits, such as coverage for Medicare Part A and B coinsurance and copayments, some plans offer additional benefits, such as coverage for foreign travel emergency care. Basic benefits are: coinsurance for an inpatient hospital stay for days 61-90, 100% of hospital care beyond day 150, 20% coinsurance for the Medicare-approved amount after you meet the Part B deductible, and the first three pints of blood each day.
The following are the ten standardized Medigap plans available in most states:
- Plan A: This plan covers basic benefits, including Medicare Part A and B coinsurance and copayments, as well as the first three pints of blood.
- Plan B: covers basic benefits, plus the Medicare Part A deductible.
- Plan C: This plan covers everything that Plan B covers, as well as the Medicare Part B deductible, skilled nursing facility coinsurance, and foreign travel emergency care.
- Plan D: covers basic benefits, as well as skilled nursing facility coinsurance and foreign travel emergency care.
- Plan F: This plan covers everything that Plan C covers, but also covers the Medicare Part B excess charges. However, if you were not eligible for it before January 1, 2020, you cannot enroll in it. It has a high-deductible version in some states.
- Plan G: has the same coverage as plan C, but does not cover the Medicare Part B deductible. It has a high-deductible version in some states.
- Plan K: covers a portion of the cost-sharing for Medicare-covered services.
- Plan L: This plan covers a higher percentage of the cost-sharing for Medicare-covered services than Plan K.
- Plan M: This plan covers everything that Plan D covers, but only 50% of the Medicare Part A deductible.
- Plan N: covers everything that Plan D covers, but has copayments for some services.
When choosing a Medigap plan, you’ll also want to consider the cost of the premiums. Medigap plans are sold by private insurance companies, and the cost of the premiums can vary depending on the plan you choose and where you live. It’s important to compare the costs and coverage of different plans to find the one that best fits your needs and budget.
Conclusion
Medicare Supplement Insurance can be a valuable addition to Original Medicare, helping to cover some of the out-of-pocket costs associated with healthcare services that are left uncovered by Original Medicare. When paired with a Medicare Part D plan, Medigap can provide comprehensive coverage for both medical and prescription drug costs.
If you’re interested in enrolling in a Medigap plan, it’s important to do your research and compare your options. Consider the coverage and premiums of each plan, and choose the one that offers the benefits that are most important to you.
With the right Medicare Supplement Insurance plan, you can have greater peace of mind knowing that you’re covered when unexpected healthcare costs arise.
