A Medicare Supplement insurance plan, also known as Medigap, is healthcare insurance you can buy that may help pay for the out-of-pocket costs Original Medicare doesn’t cover.
Let’s explore how Medicare Supplement plans work, what they cover and more.
Table of Contents:
How do Medicare Supplement insurance plans work?
Original Medicare Part A (Hospital Insurance) and Part B (Medical Insurance) pay for many, but not all, healthcare services and supplies. Medicare Supplement insurance plans help pay your share of some of the healthcare costs that Original Medicare doesn’t cover, like copayments, coinsurance and deductibles.
Other important things to know:
- Medicare Supplement insurance plans are not the same as Medicare Advantage plans.
- A Medigap policy only covers 1 person. If you and your spouse both want Medigap coverage, you must buy separate policies.
- Medigap policies do not include prescription drug coverage. If you want prescription drug coverage, you can join a Medicare Prescription Drug Plan (Part D).
- You pay a monthly premium when you have a Medicare Supplement plan in addition to the Part B premium from Original Medicare.
- A Medicare Supplement policy is guaranteed renewable even if you have health problems. This means your private insurance company can’t cancel your policy if you pay the premium and provide accurate information on your application.
- Medigap policies generally don’t cover long-term care, vision or dental care, hearing aids, eyeglasses or private-duty nursing.
What does Medicare Supplement insurance cover?
Medicare Supplement insurance plans help pay for costs not covered by Original Medicare. Each plan provides a range of benefits so you can choose the best Medigap plan for your needs.
- Part A coinsurance and hospital costs up to an additional 365 extra days after Medicare benefits are used
- Part B coinsurance or copayment
- Blood (first 3 pints)
- Part A hospice care coinsurance or copayment
Additional benefits that may be included in certain plans:
- Skilled nursing facility care coinsurance
- Part A deductible
- Part B deductible
- Part B excess charge
- Foreign travel exchange (up to plan limits)
- Out-of-pocket limit
Everyone has unique healthcare needs. If you’re thinking about adding extra insurance to Original Medicare, check out how to pick the best Medicare Supplement insurance plan for you.
What does Medicare Supplement insurance not cover?
Medicare Supplement plans generally don’t cover:
- Long-term care (like non-skilled care you get in a nursing home)
- Vision or dental services
- Hearing aids
- Private‑duty nursing
- Prescription drug coverage
If you’re looking for prescription drug coverage,
Medicare Part D could be the answer. There are 2 ways to get Medicare Part D prescription drug coverage: a stand-alone plan, which works with Parts A and B, or a Medicare Advantage Prescription Drug plan (MAPD).
To get coverage for other products and services, a Medicare Part C (Medicare Advantage) plan may be a good option. Like Medicare Supplement plans, most Medicare Advantage plans offer various benefits so you can shop your options and pick the right plan for your needs.
Who is eligible for a Medicare Supplement plan?
To buy a Medicare Supplement plan, you must be:
- 65 years old or older
- Enrolled in Medicare Parts A and B
- Live in the state where the policy you want is offered
Note: In some states, you can be under age 65 with a disability or end-stage renal disease (ESRD).
When can I enroll in a Medicare Supplement plan?
You can apply for a Medicare Supplement policy any time. However, the best time to buy a plan is during your 6-month Medicare Supplement Open Enrollment period.
Your Medicare Supplement Open Enrollment period starts the first month you’re both age 65 or older and have Part B. The big advantage is you can buy any Medicare Supplement plan sold in your state without answering health questions. Even if you have health problems, insurance companies cannot deny you a Medicare Supplement policy and must offer the same price as people with good health.
If you apply after your open enrollment period, there is no guarantee that an insurance company will sell you a policy unless you are eligible for a guaranteed issue right. If you’re under age 65 and have Medicare, you may not be able to buy a Medicare Supplement policy or the one you want until you turn 65.
How much does Medicare Supplement insurance cost?
Each insurance company can set their own price, or premium, for its Medicare Supplement plans. There can be differences in the premiums that different insurance companies charge for exactly the same coverage.
As you shop for a Medigap policy, be sure to compare the same policy between several insurers. For example—if you’re interested in Medigap Plan C—compare the price of Medigap Plan C from 2-3 different insurance companies. This way you know you’ll be getting the best price for the plan you want.