Medicare Supplement Insurance

What is Medicare Supplement Insurance Plan?

Medicare Supplement Insurance Plans and Medigap are one in the same, this plan helps to cover the gaps that Medicare Part A and Medicare Part B don't. Instead of waiting to be reimbursed (if applicable), Medicare Supplement Insurance plans pay the facility directly for any of what are called cost-sharing expenses. You purchase these plans via private insurance companies which offer different levels of coverage. The premium you pay is dependent on the policy.

These plans only offer coverage for one person meaning each spouse must purchase their own plan.

 

General Insurance

Premiums: In order to keep your policy active you must pay this to your insurance company or to Medicare. 
 

Deductibles: This is the amount that you are required to pay until you reach your set deductible amount.
 

Copay: This is what you pay when you visit a provider or facility for a service rendered. This amount varies on the types of providers if they're specialists, in or out of network. Medicare copayment rates are set every year and are based on the current inflation rate. 
 

Coinsurance This is a fixed percentage that you will be responsible for, if your insurance covers 80% of a cost you are responsible for the remaining 20%. It is important to make sure you understand which percentage amount is your responsibility. Please check with your insurer or review your policy plan. 
 

Cost-sharing: This is the expense that you are responsible for (with the exception of premiums). This is typically deductibles, coinsurance and your copays. 

 

Out-of-pocket limits: This is the most that would be your responsibility in cost-sharing. Only 2 of the Medicare Supplement Insurance plans limit out-of-pocket costs and Medicare Part A and Part B have no out-of-pocket limit.
 

How Does a Medicare Supplement Insurance Plan Work

There are a handful of rules you must follow to be eligible:

• Unless you have Medicare Part A and Part B you cannot buy a Medicare Supplement Insurance Plan. Medicare Part A and Part B must be active for the entirety of your Medicare Supplement Insurance plan.
• A Monthly Premium for your Medicare Supplement Insurance plan will have to be paid but will vary by your plan and location. These premiums are set by the individual insurance companies.
• The plan will cover some of your out-of-pocket expenses that Original Medicare does not cover which is in return for the payment of your premium.

 

“To understand how the Medicare Supplement Insurance plan works remember that Medicare Part A and B both have deductibles and/or coinsurance. So after the deductible is met, Medicare Part B will generally pay 80% and the other 20% will be your responsibility.
 

As an example, if you have a $1000 bill, The deductible for Medicare Part B is $240(2024 deductible amount used for this example, per medicare.gov and is subject to change): $1000 - $240 Deductible that you pay = $760. Medicare Part B will pay 80% of the remaining $760.00 which means you are responsible for the remaining 20% which would be $152.00 Your total out-of-pocket cost would be $392 for that $1000 bill.

With Original Medicare, there is no maximium limit put on your out-of-pocket expense. As an example, if you have a $10,000 bill you will pay the same $240 deductible(example amount used above). This means that you will have to pay the remaining 20% of the remaining $9760 which would be $1952 bringing your total out-of-pocket cost to $2192.00.

 

What Does it Cover?

Medicare Supplement Insurance plans help cover out-of-pocket costs associated in Original Medicare, like:

• Copayments

• Coinsurance

• Deductibles

 

*per https://www.medicare.gov/health-drug-plans/medigap/basics/coverage. 
 

What is not covered?

Medicare Supplement Insurance Plans can cover Medicare-approved expense, but cannot cover expenses not covered by Medicare Part A & Part B.
 

Here are a few areas that a Medicare Supplement Insurance Plan does not cover:

• Dental
• Vision
• Hearing

Since these items are not considered cost-sharing expenses you are responsible for covering them. Medicare might cover some emergency dental expenses and diagnostic vision tests  

 

Medicare Advantage plans may help cover additional benefits. You should note that Medicare Supplement Insurance plans do not cover premiums for Part A and Part B and they both must be active to keep your Medicare Supplement Insurance plan active.

 

Who is eligible?

In order to be eligible for a Medicare Supplement Insurance Plan you must first be enrolled in Original Medicare Parts A and B. Below is the enrollment information for eligibility:

 

• Eligibility in some states may be age

• Insurance companies are not required by Federal Law to sell Medicare Supplement Insurance plans to people under 65

• Must be enrolled in Original Medicare parts A and B

• Cannot have a Medicare Supplement Insurance Plan and Medicare Advantage Plan

• If you are new to Medicare, the Medicare Supplement Insurance plans F and C are not available to you

Open Enrollment Period

For Medicare Supplement Insurance (Medigap) Plans, the Medigap Open Enrollment Period begins on the first day of your birthday month when you turn 65 or are older and enroll in Medicare Part B, lasts for 6 months. During this 6 month period you are able to buy any Medicare Supplement Insurance plan without being turned down or charged more because of a health condition and medical underwriting cannot be used. You must pay monthly premiums to maintain your coverage after you are enrolled.

Although you are able to apply for a Medicare Supplement Insurance plan at any time, please note that if you buy outside of this 6 month period you may be denied for a Medicare Supplement Insurance plan if you have a pre-existing condition or other health issues. Please check with the insurance company as some states may have an extended or additional enrollment times where it is not necessary to have medical underwriting. 
 

Help Protect your Finances

With Original Medicare there are deductibles and other expenses that are your responsibility, with a Medicare Supplement Insurance Plan you may be able to protect yourself from unexpected cost-sharing expenses, deductibles and other costs because you are able to fill those gaps with a plan that is right for you. MedicareOptions.PRO can help you navigate these plans and help educate you with the necessary information to make an educated decision. 

Are you currently on Medicare and moving? Call today for assistance.