Medicare Supplement or Medigap coverage
What’s a Medigap Policy?
Original Medicare pays for many, but not all, health care services and supplies. A Medigap policy is private insurance that helps supplement Original Medicare.
This means it helps pay some of the health care costs that Original Medicare doesn’t cover (like copayments, coinsurance, and deductibles). These are “gaps” in Medicare coverage. If you have Original Medicare and a Medigap policy, Medicare will pay its share of the Medicare-approved amounts for covered health care costs. Then your Medigap policy pays its share.
A Medigap policy is different from a Medicare Advantage Plan (like an HMO or PPO) because those plans are ways to get Medicare benefits, while a Medigap policy only supplements the costs of your Original Medicare benefits. Note: Medicare doesn’t pay any of your costs for a Medigap policy. All Medigap policies must follow Federal and state laws designed to protect you, and policies must be clearly identified as “Medicare Supplement Insurance.” Medigap insurance companies in most states can only sell you a “standardized” Medigap policy. Each standardized Medigap policy must offer the same basic benefits, no matter which insurance company sells it. All plans offer the same basic benefits but some offer additional benefits. You can choose which plan meets your needs. Note: In most states, standardized policies, or plans, are identified by the letters A, B, C, D, F, G, K, L, M, and N, and each type of plan generally contains the same benefits in all states. In Massachusetts, Minnesota, and Wisconsin, benefits will be labeled differently, but the policies are still standardized within each state. Other things to know about Medigap policies Who can buy a Medigap policy? Generally, you must have Medicare Parts A and B to be able to buy a Medigap policy. The best time to buy a Medigap policy is on the first day of the month in which you’re 65 or older and enrolled in Part B. This time period, called your Medigap Open Enrollment Period, ends 6 months later. During this period, an insurance company can’t refuse to sell you a policy or charge you more because of your health. If you’re under 65, you won’t have this Open Enrollment Period until you turn 65, but state law might give you a right to buy a policy before then. Note: A Medigap policy covers only one person. Spouses must each have their own policy. 4 Other things to know about Medigap policies (continued) How much do Medigap policies cost? You pay a monthly premium to the private health insurance company that sells you the policy. The premiums will be different for plans with different benefits (for example, Plan A compared to a Plan F), but will also differ among insurance companies selling the same plan. Therefore, it’s very important to compare policies and their costs. Note: If you buy Plan K, L, or N, you’ll pay part of the Part B coinsurance and copayments, which may result in lower premiums for some Medigap Plans. Also, plans called “Medicare SELECT” may cost less because they’ll only provide benefits if you use specific hospitals or doctors. Where can Medigap policies be used? Unless the policy is a “Medicare SELECT” policy, a Medigap policy can be used in any U.S. state or territory, so you don’t need to buy a new one if you move. Do Medigap policies cover prescription drugs? New Medigap policies don’t offer prescription drug coverage. If you want prescription drug coverage, you must get a stand-alone Medicare Prescription Drug Plan that works with Original Medicare, or you can leave Original Medicare and join a Medicare Advantage Plan that offers drug coverage. How do Medigap claims work? You get a Medicare Summary Notice (MSN) every 3 months from Medicare that lists your health insurance claims information. It’ll tell you if Medicare paid the claim and if it’s been sent to your Medigap insurance company. You should compare your MSN to any statement you get from the Medigap insurance company and any bill you get from a provider. Can my Medigap policy be cancelled? Any Medigap policy is guaranteed renewable even if you have health problems. This means the insurance company can’t cancel your Medigap policy as long as you pay the premium.