How Does Medigap Work? Medigap 101

Understanding Medigap basics

Once you understand how Medigap works with Medicare you can dig a little deeper to learn about the different types of plans, how premiums are determined and how you can use Medigap.

The following video will go beyond how Medigap works with Medicare to address these topics.

Medigap facts

In the first video in this series we learned that Medigap is insurance offered by private companies designed to fill the gaps of original Medicare.

These gaps are monetary in nature and not intended to provide additional benefits beyond what is normally included in Medicare.

Gaps include Parts A and B deductibles and coinsurance amounts that are your responsibility.

Medigap policies are standardized and are designated by the letters: A, B, C, D, F, G, K, L, M, and N.

Plan F benefits, for example, will be identical no matter which company offers it.

Medicare Supplement Plans Benefit Checklist
A
B
C
D
F*
G
K
L
M
N
Basic Plan (Part A Coinsurance up to an additional 365 days)
x
x
x
x
x
x
x
x
x
x
Basic Plan (Part B Coinsurance/ Co-payment; 1st 3 Pints Blood; Part A Hospice Care Coinsurance/ Co-payment)
x
x
x
x
x
x
50%
75%
x
100% except up to $20 co-pay for office visits and $50 co-pay for ER visits
Skilled Nursing Co-payment ($144.50/day for days 21 – 100 for 2012)
x
x
x
x
50%
75%
x
x
Part A Deductible ($1,156 for 2012)
x
x
x
x
x
50%
75%
50%
x
Part B Deductible ($140 for 2012)
x
x
Part B Excess Charges (additional 15% for providers not accepting Medicare assignment)
x
x
Foreign Travel Emergency
x
x
x
x
x
x
Out-of-Pocket Maximum
$4,660
$2,330

* Plan F includes a high deductible option where $2000 is required before benefits are paid.

Massachusetts, Minnesota and Wisconsin have plans that are standardized in their own unique ways.

What Determines Medigap premiums?

Their are several factors that can effect premiums aside from which plan is chosen and which company is selling it. The following are some things that can effect Medigap premiums:

  • Age
  • Gender
  • Where you live
  • Your health
  • Tobacco use

Choosing providers

Unlike Medicare Advantage plans, when you own a Medigap policy you can choose any provider that accepts Medicare. This is an advantage for people who travel or reside in more than one State such as snowbirds.

The exception is a type of policy called Medicare Select. This is a Medigap policy that requires you stay within a network. Medicare Select policies make up a very small portion of all Medicare supplements.

Renewing your plan

Unlike Medicare Advantage, you do not need to renew your plan each year and you cannot be canceled unless you cease to pay your premiums.

Medigap and Part D

At one time, you could buy a Medigap policy that included drug coverage, but this is no longer the case. If you would like drug coverage (highly recommended) you will need to enroll in a stand-alone Part D plan.

See Part D Plans For All 50 States & Washington D.C.

Part D plans are State-specific, require you pay a monthly premium and renew or choose a new plan each year during the Annual Enrollment Period.

Next: Video 3 – Medigap vs Medicare Advantage – The Differences

 

Leave a Reply

Your email address will not be published. Required fields are marked *