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Medicare Supplement Plans (Medigap) in Minnesota

October 6, 2016

Medicare Supplement (Medigap) plans in Minnesota are different from Medigap plans offered in other states. If you are a Medicare beneficiary in Minnesota, Medicare Supplement insurance can help offset your Original Medicare out-of-pocket costs.

How Medigap plans work in Minnesota

Medicare Supplement (Medigap) plans offer additional coverage for out-of-pocket expenses you may have with Original Medicare, Medicare Part A and Part B. These Medigap plans are available through private insurance companies. Medigap plans only cover one person, so if you’re married, you and your spouse will both need individual policies. You must have Part A and Part B to enroll in a plan, and you’ll need to continue paying your Medicare Part B premium, in addition to the premium for your Medigap plan.

Medigap isn’t meant to be all-inclusive health coverage; it’s a way to supplement your Original Medicare benefits. For example, it doesn’t include prescription drug coverage, which must be purchased separately with a Medicare Prescription Drug Plan. Also, Medicare Supplement benefits don’t work with Medicare Advantage plans.

Minnesota’s eligibility rules are different than in other states. In Minnesota, you are first eligible to enroll in a Medigap plan as soon as you enroll in Medicare Part B. Once you have Part B, your six-month Medigap Open Enrollment Period (OEP) begins. During this time, you have guaranteed-issue rights, meaning that insurance companies may not reject you or charge you a higher premium because of pre-existing conditions. Unlike other states, there are no age restrictions that affect your eligibility, as long as you have Medicare Part B.

Types of Medigap plans in Minnesota

Medigap plans sold in Minnesota have different standardized benefits than plans offered in other states. In the rest of the country, each state offers a selection of 10 Medigap plans, with each plan type designated by a letter (for example, Plan F). Benefits are the same across each plan letter, regardless of location or insurance company. Minnesota, Massachusetts, and Wisconsin are the exceptions, with each state offering its own standardized Medigap benefits. However, modified versions of Medigap Plans K, L, M, N, and high-deductible F are offered in Minnesota.

Minnesota offers two types of Medigap plans: the Basic Plan and the Extended Basic Plan.

The Basic Plan covers:

  • Part A inpatient hospital coinsurance
  • Part B coinsurance
  • First three pints of blood each year
  • Cost-sharing expenses for Part A hospice and respite care
  • Cost-sharing expenses for Part A and Part B home health care
  • Part A skilled nursing facility (SNF) coinsurance for 100 days
  • 80% of the cost of overseas emergency coverage
  • 50% of Part B outpatient mental health costs
  • 20% of physical therapy services
  • Benefits mandated under Minnesota law, including cancer screenings, reconstructive surgery, vaccinations, and diabetic supplies

The Extended Basic Plan covers:

  • Part A inpatient hospital coinsurance
  • Part B coinsurance
  • First three pints of blood each year
  • Cost-sharing expenses for Part A hospice and respite care
  • Cost-sharing expenses for Part A and Part B home health care
  • Part A skilled nursing facility (SNF) coinsurance for 120 days
  • 80% of the cost of overseas emergency coverage
  • 50% of Part B outpatient mental health costs
  • 20% of physical therapy services
  • Benefits mandated under Minnesota law, including cancer screenings, reconstructive surgery, vaccinations, and diabetic supplies
  • Part A inpatient hospital deductible
  • Part B deductible
  • Medicare-covered preventive services
  • 80% of usual and customary fees
  • 80% of overseas coverage

The main difference between the two plans is that the standard Basic Plan doesn’t cover the Part A inpatient hospital deductible, Part B deductible, usual and customary fees, or non-emergency coverage in a foreign country. The Extended Basic Plan fully covers the Part A and Part B deductibles, and partially covers non-emergency overseas coverage and usual and customary fees. The Extended Basic Plan also pays for Medicare-covered preventive services and an additional 20 days of coinsurance costs for Part A skilled nursing facility (SNF) stays.

However, insurance companies allow beneficiaries with Basic Plan coverage to add on optional riders. Basic Plan members can add on any or all of the following benefits:

  • Part A inpatient hospital deductible
  • Part B deductible
  • Usual and customary fees
  • Preventive care not covered under Medicare

Minnesota also offers Medicare SELECT plans. This is a type of Medigap insurance usually has a lower premium cost and requires members to use in-network providers to be fully covered. Medigap guaranteed-issue rights also apply to Medicare SELECT plans.

For more information on how Medigap works in Minnesota, visit www.mn.gov or contact Minnesota’s State Health Insurance Assistance Program (SHIP) at 1-800-333-2433 from 8AM to 4:30PM Monday through Friday.

Choosing a suitable Medigap plan in Minnesota

Medicare Supplement plans in Minnesota come with standardized benefits, meaning that plans of the same type offer the same coverage. All Basic Plans and Extended Basic Plans must offer the same benefits detailed above. However, insurance companies may charge different premiums for the same benefits. When comparing plans, pay attention to how the insurance company prices its premiums, not just the current premium cost. The insurer’s pricing method can affect your premium costs both now and in the future.