What Is Medicare Supplemental Insurance?

Medicare Supplemental Insurance is insurance coverage designed to cover gaps in Medicare. This includes your deductibles, coinsurance, co-pays, and excess charges. This coverage is also often called Medigap Insurance, because it covers the gaps in Original Medicare.

To understand how Medicare supplements work, it’s best to first understand the basics of Medicare coverage.

What Does Medicare Cover?

Medicare offers several benefits related to medical and prescription drug coverage. On its own, it can provide pretty decent coverage. However, it can expose you to significant co-pays and coinsurance with no limits on financial exposure.

Medicare breaks it’s coverage down into four parts categorized by letter designations.

Original Medicare

Medicare Part A is your hospital insurance. It helps cover medical expenses if you are in the hospital. Your financial responsibility with Part A includes deductibles, coinsurance, and co-pay expenses. These can become significant if you do not have Medicare supplemental insurance coverage. You are automatically enrolled Part A at age 65 if you worked at least 40 quarters in the United States. You can also qualify for coverage through a spouse who worked at least 40 quarters.

Medicare Part B is coverage for outpatient medical services. You are responsible for deductibles, coinsurance, co-pays, and excess charges if you don’t have a Medicare supplement. This coverage is elective but most Medicare recipients choose to enroll. You will pay a monthly premium for Medicare Part B. Your income level serves as a base for this premium. The more you make more per year, the more you’ll pay more for Part B. The current minimum premium is $134 per month.

Other Parts

Medicare Part C is a privatized plan that is also known as Medicare Advantage. You can choose to take this plan offered by private health insurers instead of regular Medicare. While there are benefits to this plan, you will typically find that there are far fewer doctors and hospitals that accept this type of policy. You will still have to pay your Medicare Part B premiums to own this type of policy. This might mean you may pay anywhere from $0 additional to over $100/month for this plan. If you have this plan you, will not be able to buy a Medicare Supplemental Insurance plan.  Medicare supplements are not intended to cover gaps in Medicare Advantage.

Medicare Part D is your prescription drug coverage. Part D is available to any individual already enrolled in Parts A and B. This coverage is optional. However, it might be wise to enroll in a Part D plan to avoid the Part D penalty if you end up needing this coverage down the road. In some states, you will pay as little as $20 per month.

How Do You Choose a Medicare Supplemental Insurance Plan?

Medicare supplemental insurance plans have standardized coverage between companies. Some companies also offer additional benefits to these plans. However, such services are not a part of the policy, can discontinue at any time, and may be subject to geographic availability.

Medicare supplemental insurance plans have letter designations indicating the benefits included with each. The most popular plan is currently Medicare Supplement Plan F because it covers all of the gaps in Medicare. Over half of our clients who own a Medicare Supplemental plan own Plan F.

What Costs Should I Consider?

So, understanding what you’ve read to this point, you should feel comfortable that if you want a Plan F, for example, you can get rates from different insurance companies and choose the least expensive Plan F. It’s that simple. You don’t have to worry about whether one company has better benefits, if another company has a better doctor’s networks, or if another is better at paying claims. Standardized Medicare Supplement Plan F will work the same regardless of which company you purchase the plan from.

Compare Your Medicare Supplement Rates Immediately!