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What is Medicare Supplement Insurance (Medigap)?

Medigap, or Medicare Supplement Insurance, is supplementary private health insurance that complements Original Medicare. Medicare Supplement Insurance is available to enrollees to assist with costs not covered by Original Medicare (Parts A and B).

Regarding medical care, Original Medicare only covers 80% of what Medicare Part A and B cover. A Medigap policy can assist pay for all or part of the 20% that Original Medicare doesn’t cover.

These plans assist with the out-of-pocket expenses you incur for hospitalization, physician services, in-home health care, lab charges, costly medical equipment, and more, such as copays and deductibles for Medicare Parts A and B.

Medigap ranges from basic to comprehensive in terms of coverage and price. Medigap does not cover both prescription drugs and dental care. However, you can acquire these add-ons independently.

How many distinct Medigap Plans are there?

A through N are the letters that represent the 12 different Medigap policies. Each lettered plan covers the basic policy benefits and varying extra help.

It’s important to consider how each Medigap plan’s benefits stack up against your healthcare requirements as you shop around. Medical expenses not covered by insurance, such as deductibles, copayments, and coinsurances, may be reimbursed depending on your specific letter plan.

Policy Operations for Medigap

Medicare Supplement Insurance is available to those who meet certain criteria. To be eligible for Medicare Supplement Insurance, you must be 65 or older, enrolled in Original Medicare, both Part A and B.

Even though you can enroll in a Medicare Supplement program at whatever time of the year, you are guaranteed to be covered for any preexisting illnesses you may have during the six-month open enrollment period.

Medigap policies are perpetually renewable so long as premiums are paid. Therefore as you continue to pay your premium, your insurance will be maintained yearly. This renewal ensures that it will be renewed annually without any additional action required from you.

There is a wide range in the price of Medigap coverage, so it is crucial to shop around. All insurance providers’ scopes for Medigap must adhere to uniform standards. Cost is the only thing that varies between Medigap plans from different providers.

Each member of a married couple should obtain their Medigap policy. Your spouse is not eligible for coverage under your Medigap policy. Some Medigap policies may cover additional services not paid for by Original Medicare.

Medicare Supplement Insurance meets typical coverage gaps in Original Medicare. Private Medigap policies have monthly premiums paid directly by policyholders to the insurance company. These costs are in addition to those for Original Medicare (Parts A, B, and D).

Key Takeaways for Medigap

There are a key takeaways you should note before enrolling on the Medigap plan:

  • Both Parts A and B of Medicare are required.
  • You can enroll in Medigap coverage even if you’re already enrolled in a Medicare Advantage plan, but you’ll need to cancel your MA coverage before your Medigap coverage takes effect.
  • Your monthly fee for the Medigap plan from the private insurer is in addition to your monthly premium for Medicare Part B.
  • A Medigap policy can cover only one person. You, as well as your spouse, must each purchase your Medigap policy if you both wish to be covered.
  • A Medigap policy can be purchased from any insurance provider with the necessary state licenses to do business in your area.
  • Regardless if you are experiencing health issues, you are guaranteed renewal on any normal Medigap coverage. Your Medigap coverage is guaranteed renewable as you continue to pay your premium.
Medigap VS Medicare Advantage

Private insurers provide Medicare Advantage and Medigap policies, but they are very different. Medicare Advantage programs replace Original Medicare and offer more comprehensive coverage than Medigap policies, you can learn more about Medicare here.

Medigap policies are supplementary and help address gaps by covering out-of-pocket expenditures connected with Original Medicare. You can get either a Medicare Advantage or a Medigap policy, but not both at the same time.

After signing up for Medicare Part A and Part B, you are eligible to enroll in a Medicare Advantage plan. When you sign up for a Medicare Advantage plan, you no longer need Medicare Parts A and B.

Medigap helps with coinsurance, copayments, and deductibles, some of the costs that Original Medicare doesn’t cover. Medigap is not meant to cover expenses that Original Medicare (Parts A and B) do not.

Because of this, you cannot use Medigap to pay for Medicare Part B copayments or deductibles or for hearing, vision, or dental care that Original Medicare does not cover.

You may want to consider a Medicare Part D plan even if you possess Original Medicare and even Medigap coverage to assist pay for your prescription medication costs.

Part D insurance is optional with Medicare, but if you don’t sign up for it when you first become eligible for Medicare, you may be subject to permanent penalties if you ever decide to enroll in and pay for drug coverage.

If you’re healthy and don’t have a lot of medical bills, Medicare Advantage could be your preferred option. However, the majority of people should consider Medigap.

Combining Medicare Advantage with Medigap is not possible. You are free to choose between the two options.

Bottom Line

The state of your finances and your health should be considered before making any major choices. A discussion with a Medicare expert can help determine the optimal Medicare plan for you.

When you combine traditional Medicare with a Medigap policy, you have more leeway in deciding where and how you receive medical treatment. Those who spend significant time each year in a new region may be better off with traditional Medicare plus Medigap insurance coverage rather than a Medicare Advantage plan.