Are you considering getting a Medicare Supplement plan? Maybe you want to find out more about Medicare Supplement insurance. Make sure you understand what different plans cover so you can find a plan that may best meet your needs.

What is a Medicare Supplement plan?

Let’s start with a bit of background about Medicare Supplement (also called Medigap) plans.

Private insurance companies offer Medicare Supplement plans to help pay Medicare’s out-of-pocket costs. Different Medicare Supplement plans pay for different amounts of those costs, such as copayments, coinsurance, and deductibles, and fill in some other “gaps” in Medicare coverage.

In 47 states, Medicare Supplement plans are standardized into 10 different sets of benefits, labeled by alphabetical letters so that you can easily compare plans sold by different insurance companies. For example, Medicare Supplement Plan A (not to be confused with Medicare Part A) includes the same benefits no matter where you buy this plan (however, some insurance companies might offer additional benefits).

Massachusetts, Minnesota, and Wisconsin have different standardized Medicare Supplement plans than the 10 types offered elsewhere in the United States.  Please note that all insurance companies won’t necessarily offer all the types of Medicare Supplement plans.

When you buy a Medicare Supplement plan, you generally pay a premium to the insurance company for your coverage.  Typically, as long as you continue to pay your premium and have Medicare Part A and Part B, your Medicare Supplement plan will be automatically renewed each year, although the premium amount may change.

Is a Medicare Supplement plan right for you?

Ultimately you are the best judge of the type of insurance that meets your personal needs and lifestyle.  However, if one or more of the following circumstances is true for you, a Medicare Supplement plan may be a good choice.

  • You are enrolled in Medicare Part A and Part B and have many doctor visits or frequent hospitalizations.
  • You want the security of knowing you’ll have help with many of the medical expenses that Medicare Part A and Part B don’t completely cover.
  • You like the flexibility of being able to choose any doctor or hospital that accepts Medicare, possibly even when traveling throughout the United States
  • You divide your time between two homes in different regions of the United States and you want to be able to receive treatment from any doctor or health facility that accepts Medicare.

A Medicare Supplement plan might not be the best choice for you in situations such as these:

  • You have coverage from a union or employer that already covers most of the medical costs that are not paid by Medicare Part A and Part B.
  • You have a Medicare Advantage plan. Medicare Supplement plans and Medicare Advantage plans aren’t designed to work together.

 How do I shop for the best Medicare Supplement plan?

Each standardized Medicare Supplement plan helps cover a different range of certain Medicare costs. For example, some plans may cover 100% of the Medicare Part A deductible, some cover a portion of that deductible, and some plans don’t cover the deductible at all. Some plans may cover emergency medical care when you’re traveling (at a maximum of 80%, up to plan limits).

One way to compare the benefits offered by the 10 standardized Medicare Supplement plans is to take a look at this chart. Think about which services you use the most and where your highest Medicare out-of-pocket costs have been. For example, is there a good chance you’ll spend some time in a skilled nursing facility? Medicare Supplement Plans C, D, F, G, M, and N may cover these Medicare-approved costs at 100%.

Keep in mind that you do pay a monthly premium with a Medicare Supplement policy (and you still continue paying your Medicare Part B premium as well). Medicare Supplement plan premiums may vary by insurance company and among different plans. Generally speaking, the more coverage provided by the Medicare Supplement plan, the higher the premium.

Some things to consider before making a decision about which Medicare Supplement plan may be best for you include:

  • How much do I spend on health-care costs? Will the Medicare Supplement plan provide value or will the premium cost more than I currently spend on health care?
  • What do I spend my health-care dollars on? Which Medicare Supplement plan or plans provide coverage for these medical services and supplies?  Will I also want to purchase insurance for items neither covered by Part A and Part B nor by Medicare Supplement plans –such as Medicare Part D Prescription Drug coverage?
  • How much can I afford to spend in premiums? Remember, you continue to pay separately your Medicare premium (for most people Part B premium), your Medicare Supplement plan premium, and if you choose to add prescription drug coverage, your Medicare Part D Prescription Drug Plan premium.

Medicare Supplement insurance plans are not connected with or endorsed by the U.S. government or the Federal Medicare program.

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