What is a Medicare Supplement Plan?
A Medicare Supplement Plan, also known as Medigap, provides supplemental health insurance for health care costs not covered by Original Medicare (Parts A and B), such as co-payments, deductibles, and health care if you travel outside the United States. Medicare Supplement Plans are sold by private insurance companies and you must pay a monthly premium, in addition to your Part A and B premiums. Medicare Supplement Plans are often referred to as “Medigap” – they help cover the gap in what Original Medicare doesn’t pay in healthcare costs.
Medicare Supplement Plans do not cover any additional services or supplies beyond your Original Medicare (Part A and B) benefits. The Centers for Medicare and Medicaid Services (CMS), the federal agency governing Medicare, has designated several standardized Medicare Supplement Plans, labeled “A” through “N.” (These letters are not related to the Medicare Part A, B, C and D labels.)
Each of the standardized plans provides benefits for different out-of-pocket costs, and all of the plans with the same letter must offer the same basic benefits. For example the basic benefits of one company’s Plan G are the same as the basic benefits of another company’s Plan G, regardless of your location. The only difference between Medicare Supplement Plans with the same letter is usually the monthly premium cost.
Medicare Made Easy Part Four: Medicare Supplement (Medigap) Plans
Why Consider a Medicare Supplement Plan?
Medigap plans help pay the out-of-pocket medical costs not covered by Original Medicare (Parts A and B).
- No referrals needed to visit specialists.
- No claim forms to fill out or submit.
- Your plan travels with you nationwide.
Who is Eligible for a Medicare Supplement Plan?
To apply for a Medicare Supplement Plan, you must first be enrolled in both Medicare Part A and Part B. You are eligible to apply without underwriting when you first join Medicare and in a few special circumstances, but generally after your Initial Enrollment Period, you will be subject to medical underwriting and may not be accepted into a Medicare Supplement Plan.
When Can You Enroll in a Medicare Supplement Plan?
You have a designated Medicare Supplement Open Enrollment Period that begins when you are both 65* (or older) and enrolled in Part B. This enrollment period lasts for 6 months, and it is the only time you will have a guaranteed-issue right to join a Medicare Supplement Plan. You may not be denied coverage based on any pre-existing conditions during this enrollment period (although a waiting period may apply). If you miss this enrollment period and attempt to enroll in the future, you may be denied coverage or charged a higher premium based on your medical history.
*In some states, you may be able to enroll in a Medigap Plan before the age of 65.
Medicare Advantage vs. Medigap
Both Medigap and Medicare Advantage plans offer lower deductibles, copays and financial support, but there are a few key differences in what the plans offer.
Apart from offering healthcare coverage when traveling outside the US, Medigap does not offer additional benefits or coverage on top of what Original Medicare provides. Some Medicare Advantage plans offer health coverage outside the US, while also providing dental , vision, hearing, fitness and flex card benefits.
Number of plans
If you are interested in a Medigap plan, you will be enrolled in both Original Medicare as well as your Medicare Supplement Plan. If you desire prescription drug coverage, you will also need to enroll in Part D. This means you may be paying three different premiums for comprehensive coverage.
Medicare Advantage plans are designed to include everything that Original Medicare offers, plus more. Many Medicare Advantage plans include Part D coverage as well as low to no premiums, and lower out-of-pocket expenses. Having all of your healthcare coverage living in a single plan can make managing your network and costs easier.
If you are deciding between a Medicare Advantage and Medicare Supplement Insurance (Medigap) plan, it’s important to consider how much each plan will cost, how convenient your coverage will be, and if you are interested in additional benefits.
Will a Medicare Supplement Plan Provide Coverage for Medical Foreign Travel Emergencies?
The standard Medicare Supplement Plans (C, D, F, G, M and N) all provide foreign emergency care when traveling outside of the United States.
For example, your Medigap Plan may cover foreign travel emergency care if it begins during the first 60 days of the trip or if Original Medicare does not cover the emergency care. A Medigap Plan may also pay up to 80% of the billed charges for foreign medical emergency care after a $250 deductible is met for the year. The lifetime limit of foreign travel emergency coverage with a Medicare Supplement Plan is $50,000.
Frequently Asked Questions
You’ve seen the term “Medicare Supplement” multiple times throughout this article, so you may be wondering, “what is Medigap?” When talking about Medigap, you can use the terms “Medigap” and “Medicare Supplement Insurance” interchangeably. While Medigap doesn’t offer additional benefits on top of Original Medicare, Medigap helps to pay for what is not covered by Original Medicare – the 20 percent Medicare coinsurance.
You’re not required to enroll in a Medigap, or Medicare Supplement Insurance, plan if you are already enrolled in Medicare. That being said, Medigap can help supplement the cost of deductibles, copayments and coinsurance that Original Medicare doesn’t cover. You can decide whether a Medigap plan is right for you based on your finances, and whether you are interested in additional coverage. If you desire a plan with additional savings and benefits, you may wish to look into a Medicare Advantage plan.
You cannot have Medicare Supplement and Medicare Advantage plans at the same time.
Annual Enrollment Period (AEP)
Medicare Annual Enrollment Period runs each year from October 15 to December 7. What is the Annual Enrollment Period vs. Open Enrollment Period?
Initial Enrollment Period (IEP)
Your Initial Enrollment Period generally surrounds your 65th birthday but may occur if you otherwise become eligible for Medicare for the first time.
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Last Updated: October 13, 2023