Medicare supplement insurance also known as Medigap is a supplemental Medicare coverage program for filling in some of the
services that are not covered in the original Medicare program (Parts A and B). Medigap or Medicare Supplemental Insurance as a program is standardized by the same agency such as Medicare and CMS
(Centers for Medicare and Medicaid Services), but Medicare Supplement Insurance plans are sold and administered by private companies.
Medigap policies, since the introduction of Medicare Part D, are prohibited from covering drugs, and a Medicare Advantage
beneficiary can’t claim on a Medicare Supplemental Insurance policy at the same time. So Medigap is an alternative solution to enrolling in a Medicare Advantage plan and is in addition to the
original Medicare. In fact, almost one in five Medicare beneficiaries chose s a Medigap or Medicare Supplemental Insurance policy.
Medigap Insurance is offered in ten standardized plans, initially labeled A to N, and the rules of selling a Medicare
Supplemental policy can vary. Some states require extended coverage in contrast to the definitions of the standardized Medigap Insurance plans. Notably though Medicare covers both spouses, Medicare
Supplement Insurance is strictly personal and each spouse must make separate amends if both wish to be covered by Medicare Insurance as well as Medicare. Plan A Medigap Insurance covers coinsurance
for Part A and Part B of Medicare, as well as the first three pints of blood that may be needed in any claim and all coinsurance for Part B-covered preventive services after Part B deductible has
Plan B Medigap Insurance is like Plan A only it also covers hospital deductibles
for each benefit period. Plan C Medigap Insurance is like Plan B but with many more benefits: It covers the additional cost of remaining in a nursing facility after day 20 of the 100-day period
allowed by Part A of Medicare. It also pays for the deductible of Part B of Medicare concerning visits to the doctor and outpatient hospital care. Notably, it offers an emergency while abroad
coverage, paying 80% of medical fees for up to two months and up to $50,000 for a lifetime, with a deductible cost of $250 per calendar year.
Plan D Medicare Supplemental Insurance is almost the same as Plan C, with a
switch: It does not cover the Medicare Part B annual deductible. Plan F Medigap Insurance is like Plan C, with the addition of paying for excess charges arising from Part B services of Medicare, with
a maximum of 15% more than what Medicare approves. Plan F also has a high-deductible version, meaning that monthly premiums are lower than the premiums for the regular plan F, but coverage begins
after the annual deductible has been met ($2000 as of 2011).
Plan G Medigap Insurance is a compromise between Plans C and F. It does not cover
Part B deductibles, but it covers 100% of excess charges of Part B services as mentioned in Plan F Medicare supplemental insurance. Plans K and L Medicare Supplement Insurance are quite similar. Both
cover the coinsurance costs of hospital stays. Then the differences start: a percentage of Part B coinsurance, the first three pints of blood, hospital deductibles, as well skilled nursing facility
stays past the first 20 days are covered on a shared basis. Plan K covers 50%, while Plan L covers 75%.
Both Plans (K and L) cover for 100% of Medicare’s Part A and B coinsurance after the annual maximum has been
paid. In the case of Plan K that is $4,140; in the case of Plan L that’s $2070. There have been two recent additions to the Medicare Supplemental Insurance plan options – Plan M Medigap and Plan N
Medigap. Medicare Supplemental Plan N has similar benefits to Plan D Medicare Supplemental insurance, but there is a $20 co-payment for doctor visits and a $50 co-payment for emergency room visits.
The co-pay applies after the $162 deductible is paid. Plan M Medicare Supplement Insurance offers similar benefits to Plan D Medicare Supplement Insurance, but only covers 50% of the Part A
deductible and none of the Part B deductible.Medigap policies sold in Massachusetts, Minnesota and Wisconsin have somewhat different plans and offer prescription drug coverage, in some cases in more
depth (covering a wider range of drugs than in Part D.
Medicare Supplemental Insurance is available to those that already have Medicare coverage, both
Parts A and B. The monthly Medicare Part B premium must be paid, as well as an additional premium to the Medicare Supplemental insurance company. Prices for the plans are standardized. As mentioned
earlier, each spouse must buy his or her own Medicare Supplemental Insurance plan, since they do not offer mutual coverage. The best time to buy Medicare Supplement plans is during the
Open Enrollment period. This is a 6
month period that begins on the first day of the month in which both spouses are 65 years old or older and have enrolled in Medicare Part B. In some states, additional open enrollment periods are
available, including for people under the age of 65.During the Open Enrollment Period, insurance companies cannot use medical underwriting. This means that;
- They cannot refuse to sell you any Medicare Supplement plans
they are selling,
- They cannot charge you more for a policy because of health
- They cannot force you to wait for coverage except in the case
of a pre-existing condition although many states don’t allow this and most Medicare supplement plans waive this anyway.
To prevent these types of problems it is a good idea to buy a policy during the Open Enrollment
Period especially if you can prove you have recent creditable coverage. If you have at least six months of continuous prior creditable coverage, a Medicare Supplemental Insurance company can’t make
you wait before coverage before any pre-existing condition coverage starts. At RJames Associates and Insurance Brokers we will help you navigate Medicare Supplement maze and assist you with
determining which plan is best for you. Give us a call today!