Medigap: Medicare’s Supplemental Coverage Program
If Medicare doesn’t cover all your expenses, Medigap can help. Here’s what you should know about the program.
Medicare can be a valuable resource, but it doesn’t pay for everything. In fact, most people find it only covers about half their medical costs. The rest comes out of pocket.
That’s where Medigap comes in. It’s a group of government-regulated plans that pick up where Medicare leaves off. There are 12 Medigap plans in all, simply called Plans A through L. They offer a variety of options that get better as you pay higher premiums. Once enrolled in Medicare, you can purchase the plan that best fits your needs and budget.
Although you buy Medigap from an insurance company, the plans themselves were designed by Congress. By law, everyone enrolled in a specific plan gets the same benefits, no matter who the insurer is.
The only thing that differs is cost. Premiums and copayments vary from company to company, but benefits don’t. So look at what is best for you. Are you able to afford a higher premium and pay less later, or do you prefer a high-deductible plan that costs less up front?
Plan A is the most basic. It covers:
- Your hospital copayments for Medicare Part A
- Your medical copayments for Medicare Part B
- The first three pints of a blood transfusion
- An extra 365 days of hospitalization (after your Medicare benefits stop)
From there, the plans become more comprehensive. They can cover everything from in-home nursing to preventive care.
Twelve separate plans may sound like a lot. But in health care, one size does not fit all. Having several plans makes it easier to find one that’s right for you. Of course, it also means you need to carefully weigh your options.
And there are other issues to consider, too:
- You must also be enrolled in Medicare Parts A and B.
- You cannot have a Part C (Medicare Advantage) plan.
- Medigap doesn’t cover prescriptions, so you’ll need Part D coverage.
- It doesn’t cover eyeglasses or hearing aids.
- It doesn’t pay for dental care or wellness programs.
- Plans H, I and J are no longer available to new applicants.
- Premiums may go up over time.
- A Medigap policy only covers one person, so your spouse will need her/his own policy.
If you’re in good health, though, enrolling in a lower-tiered Medigap plan may help you save a little. But that’s not all:
- You don’t have to use network caregivers.
- You don’t need a referral to see a specialist.
- There are no copayments for approved services.
- Approval is automatic for covered treatments.
- You can use facilities and doctors outside your local area.
- Some plans pay for extended nursing care.
- Your policy won’t be canceled for any reason other than nonpayment.
- If you buy during open enrollment, you won’t be turned down.
There is only one open enrollment period for Medigap. It starts when you sign up for Medicare Part B and ends six months after. During this time, you can buy any Medigap plan you want. That’s why it’s best to act before this window closes. Afterwards, your options may be more limited.
There are plenty of ways to go about it. For instance, you can call an insurance agent and ask to review the plans. You can also drop in at your local library or contact Medicare directly. However you go about it, remember to do your research. The choice you make will likely be a permanent one.