Medicare Medigap Insurance

Medigap is extra health insurance that can help pay for some costs not covered by Original Medicare (Part A and Part B). You buy Medigap coverage from a private insurance company to pay costs such as copayments and deductibles. You pay a monthly premium for a Medigap policy.

Two requirements for getting Medigap is having Medicare Part A and Medicare Part B. Medicare Part A helps pay for hospital services while Medicare Part B covers the cost for doctor services.

Also, people who have a Medicare Advantage plan (Medicare Part C) cannot get a Medigap plan. This is because much of what Medigap covers is taken care of by Medicare Part C.

To make choosing the right plan easier and ensure that you are making the right choice, it is important you understand the numerous factors involved. In this article, we will explain all the items you need to consider while choosing a Medicare plan.

Types of Medigap Insurance

There are currently 10 standardized Medigap plans as well as one high-deductible plan available in most states. Each plan is named with a letter. There are: Plans A, B, C, D, F, G, K, L, M, N, and a high-deductible version of Plan F. Picking the right plan for you can take a lot of research.

Medicare Part A costs covered by Medigap policies

  • The cost of hospital coinsurance for up to a year after your Medicare Part A hospital benefits end
  • Medicare supplement plans also cover Part B coinsurance / copayments
  • 50-100% of Skilled nursing facility stay coinsurance
  • Medigap plans might cover up to 50-100% of your hospice care coinsurance/copayment
  • Medigap plans can cover up to 50-100% of the Medicare Part A deductible costs

Medicare Part B costs covered by Medigap policies

  • 50-100% of your Medicare Part B copay/coinsurance can be covered by Medigap
  • Medigap Plan C and Plan F are the only plans that help pay for Medicare Part B deductible
  • Plan F and Plan G Medigap policies cover the Medicare Part B excess charges

Things not covered by Medigap policies

  • Long-term care (care in a nursing home)
  • Routine vision or dental care
  • Hearing aids
  • Eyeglasses
  • Private-duty nursing

When you buy a Medigap plan, you get your benefits from Original Medicare (Part A and Part B), and the Medigap plan covers the out-of-pocket costs associated with Original Medicare benefits. When you are part of a Medicare Advantage (Part C) plan, you get your benefits from that plan instead of the federal Medicare program. These plans must provide at least the same amount of coverage as Original Medicare (Part A and Part B), but may offer additional benefits.

Foreign Travel

Medigap Plans C, D, F, G, N, or M provide coverage if you go abroad.

Medigap Pros and Cons

If you have Medigap insurance you are able to visit any provider that allows Original Medicare patients. Medigap policies may have low monthly premiums, additional benefits like dental or vision, doctor supervision, and are available to all entitled individuals.

These plans must provide at least the same amount of coverage as Original Medicare (Part A and Part B), but may offer additional benefits. Plan benefits and pricing vary widely.

It may be important for some Medicare beneficiaries to have access to senior home care. Finding out how to get this care through private medical insurance is important. Investigate coverage on home medical equipment and senior assisted living. In-home care and home medical equipment are covered under Medicare Part B (along with doctor’s visits and other preventive services). There are, however, limitations to this coverage.

Currently, there are 10 standardized Medigap plans and one high deductible plan, each represented by a letter (A, B, C, D, F, G, K, L, M, N, and high deductible F) sold in most states. Benefits and coverage rates vary with each policy, but the details of each plan remain the same despite the plan provider or location. For example, Plan A details are the same in New Jersey as they are in Oregon.

The Benefits of a Medicare Supplement plan can include

  • Minimal to no cost for Medicare-covered services, depending on the plan
  • Freedom to use the plan nationwide (except for Medicare SELECT plans)
  • No medical underwriting if the plan is purchased during the Medigap Open Enrollment Period.
  • Drug coverage is included with most of these plans
  • Managed care, such as supervision of doctors by the plan, possible case management, sometimes a 24-hour nurse hotline
  • Availability to all individuals entitled to Medicare Part A and enrolled in Medicare Part B who reside within the service area
  • Possible additional benefits, such as routine dental and vision, and health club membership
  • 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*

*Coverage may be partial for some plans

Some Medigap Plans Can Also Include

  • Skilled nursing facility care coinsurance
  • Medicare Part A deductible
  • Medicare Part B deductible
  • Medicare Part B excess charges
  • Foreign travel emergency

The Disadvantages of a Medicare Supplement plan can include

  • Drug coverage isn’t included, but you can add this through a separate Medicare Part D plan
  • Medical underwriting can be required, except during the Medigap Open Enrollment Period, with some exceptions
  • Depending on the state, plan choices may be limited and more expensive for individuals under 65
  • Cost sharing and copayments for most many services
  • Physician network restrictions
  • Possible geographic restrictions
  • Possible requirement of referrals for specialist visits

Medicare Advantage vs Medigap

Differences between Medicare Advantage and Medigap

Both Medigap and Medicare Advantage, also known as Medicare Part C, provide a series of plans that seek to reduce costs and provide benefits to the user of a plan. You cannot be enrolled in both programs at the same time as many of the benefits and costs will contradict each other. Both require and are added onto the plans and benefits of Medicare Part A and Part B.

It’s important to note that Medicare Part C includes benefits specifically related to vision, dental, and hearing as well as the drug prescription plan(s) covered in Medicare Part D. Medigap is more focused on reducing costs to Original Medicare (Parts A and B). While Medigap does provide a prescription drug plan much like in Medicare Part D, it does not include the other benefits of Medicare Part C.

Medigap policies fill in the coverage gaps

Original Medicare (Parts A and B) pays for many of your health care services and supplies, but it doesn’t pay for everything. That’s why you may want to consider getting a Medicare Supplement Insurance policy, also called Medigap. A Medigap policy is health insurance sold by private insurance companies. They help pay some of the costs that Original Medicare doesn’t cover, such as copayments, coinsurance, and yearly deductibles. Some Medigap policies also help pay for services that Original Medicare doesn’t cover at all. Basically, a Medigap policy fills the “gaps” in Original Medicare coverage.

How do Medigap policies work with Medicare?

Medigap policies supplement your Original Medicare benefits, which is why these policies are also called Medicare Supplement plans. If you have Original Medicare and a Medigap policy, Medicare will pay first and your Medigap policy will fill in the gaps. For example, suppose you have a $5,000 ambulance bill and have not yet met the yearly Part B deductible ($185 in 2019). Medicare Part B will pay 80% of your bill, minus the deductible amount. Your Medigap policy will then pay the remaining 20% plus the deductible amount.

Medigap policies protect you from big medical bills.

Costs* with and without Medigap

With a Medigap Policy Without a Medigap Policy
+ Ambulance charge: $5,000 + Ambulance charge: $5,000
+ Part B yearly deductible: $185 + Part B yearly deductible: $185
– Medicare Part B pays: $3,860  Medicare Part B pays: $3,860
– Medigap policy pays: $1,140  Medigap policy pays: $0
You pay: $0 You pay: $1,140

*Costs shown are examples only and do not represent exact calculations.

Plans that don’t supplement Medicare coverage (Aren’t Medigap policies)

  • Advantage plans (like an HMO or PPO)
  • Medicare Prescription Drug plans (Part D)
  • Medicaid
  • Employer’s or union’s plans
  • Veterans’ benefits
  • Long-term care insurance policies

Additional facts about Medigap policies

You must have Medicare Part A and Part B to get a Medigap policy.

Every Medigap policy must be clearly identified as “Medicare Supplement Insurance.”

A Medigap policy can only cover one person, so if you are married, both you and your spouse must buy separate policies.

Not all types of Medigap policies may be available in your state.