Summary: Medicare Supplement Insurance plans help cover your out-of-pocket Medicare costs. There are 10 Medicare Supplement plans that may be available to you, each providing different level of benefits.
Do you have Original Medicare (Part A and Part B) for your Medicare coverage? You may want to know about the added protection available with Medicare Supplement plans. Out-of-pocket costs with Part A and Part B can pile up, especially if you have a chronic health condition or a medical emergency.
Medicare Supplement plans help cover those out-of-pocket Medicare costs so it’s easier to budget for your health care. Here’s what to know so you can make an informed decision.
What are Medicare Supplement plans?
Medicare Supplement (Medigap) plans are designed to help pay your share of health-care costs under Medicare Part A and Part B. For example, they may pay your Medicare Part B coinsurance for Medicare-approved doctor visits and lab tests. Medicare Supplement plans are sold by private insurance companies, but they have standard benefits designed by the government. In other words, Medicare Supplement Plan A offered by Company ABC will have the same basic benefits as Plan A sold by Company XYZ. Some companies choose to offer additional benefits, but they must include the standard benefits, at a minimum.
Please note that Medicare Supplement Plan A is not the same as Medicare Part A. There are four “parts” of Medicare, and there are up to 10 lettered, standardized Medicare Supplement plans in most states.
What do Medicare Supplement plans cover?
All Medicare Supplement plans typically cover:
- Your Medicare Part A hospital coinsurance, plus an additional full year of benefits after your Medicare benefits are exhausted
- Some or all of your Medicare Part B coinsurance
- Some or all of your Part A hospice coinsurance
- Some or all of your first three pints of blood
Medicare Supplement Plan A is the most basic of the standardized, lettered Medicare Supplement plans. It usually includes only those benefits listed above.
From there, the benefits in the 10 standard Medicare Supplement plans vary a bit more. Some pay all or part of your Medicare Part A and/or Part B deductibles, your Part A skilled nursing facility coinsurance, and your Part B excess charges. A few even offer benefits for limited emergency health care when you’re traveling outside the U.S. Take a look at this Medicare Supplement plan comparison chart to help you decide which plan suits your needs.
How much do Medicare Supplement plans cost?
Each insurance company prices its plans differently. It may be a good idea to compare premiums from several insurers before you buy, since the benefits will be essentially the same.
Medicare Supplement insurance companies can use one of three ways to rate, or price, their policies:
- Community-rated, which means everyone pays the same premium regardless of age
- Issue-age rated, which means your premium is based on your age at the time you buy the policy
- Attained-age rated, which means your premiums go up as you get older and hit certain preset milestones.
Although the premium for a community-rated plan may be higher at first, it may be least expensive over time. Attained-age Medicare Supplement plans usually start with a low premium, but the increases at different age milestones can be steep. Be sure you know how your plan is rated before you buy so you aren’t hit with unexpected premium hikes later on. Also note that plans can—and do—change their premiums from time to time.
When can I buy a Medicare Supplement plan?
Your Medicare Supplement Open Enrollment Period (OEP) typically begins the month you are both age 65 or over and enrolled in Part B, and lasts for six months. If you think you will ever want coverage, it’s important to buy it during the OEP. During this time, you have guaranteed-issue rights and can’t be turned down for a pre-existing condition. If you wait to buy until after your OEP, you may have to pay more if you have a health condition, and you could be turned down for the coverage you want.
Unlike with Medicare Advantage and Medicare Part D prescription drug plans, there is no annual enrollment period for Medicare Supplement plans. You can apply for a plan anytime you want, as long as you’re enrolled in Medicare Part A and Part B. But there are only certain cases when you have guaranteed-issue rights to buy a plan.
Interested in comparing Medicare Supplement plans right now? Just enter your zip code in the box on this page to get started.