Medicare Supplement plans are offered by private insurance providers. They’re meant to help offset some of the out-of-pocket costs associated with Original Medicare, such as copayments, coinsurance, and deductibles. Medicare Supplement plans are also known as Medigap insurance. Medicare Supplement plans act as supplemental insurance to Medicare Part A and Part B.
This means if you have a Medicare Supplement plan, Medicare will cover the necessary medical expenses first. In contrast, the Medicare Supplement plan will take care of the remaining out-of-pocket costs. To qualify for a Medicare Supplement plan, you’re required to have Medicare Part A and Part B.
Medicare Supplement Plan Coverage
Medicare Supplement plans are standardized and are available in most states, including Florida. There are 10 Medicare Supplement plans, and they are labeled from Plan A to Plan N in the states where they’re available. Some Medicare Supplement plans are no longer available to new Medicare enrollees. Also, though insurance companies are not obligated to offer all of the Supplement plans, they must provide Plan A, Plan C, or Plan F. Since the policies are standardized, they must all provide the same basic benefits.
If you’ve already enrolled for Medicaid or a Medicare Advantage program, you cannot legally purchase a Medicare Supplement plan. Medicare Supplement Plans only work with Original Medicare, adding to those benefits. Also, Medicare supplement plans only provide coverage for individuals. It does not cover couples or dependents jointly. If you became eligible on January 1, 2020, or later, you are not eligible to purchase a Medicare Supplement plan that helps with Part B premiums, such as Medicare Supplement Plan F and Plan C.
However, if you already have both plans before then, you can continue with the coverage. Medicare Supplement plans cover the out-of-pocket costs for Medicare Part A, such as skilled nursing facility care, copayments, hospice care coinsurance, and extended stays at a hospital. All Medicare Supplement plans to cover some Part B costs such as coinsurance, copayments, deductibles, and other costs such as excess charges.
Each letter provides a different range of coverage beneficiaries can get:
- Plan A: This plan provides the smallest range of coverage for beneficiaries. If you get plan A you will get additional coverage for Part A coinsurance, up to 365 days of hospital stay after benefits are used, Part B coinsurance, and copayment, first the prints of blood for a medical procedure, Part A coinsurance and copayment for hospice care
- Plan B: there is not much difference between Plan A and Plan B in coverage range. However, plan B covers the Part A deductible, which helps you to more money. Besides the Part A deductible, other benefits of coverage are the same as Plan A.
- Plan C: This plan offers the widest. range of coverage for their beneficiaries. The only thing that Plan C doesn’t cover is Part B Excess charges. However, Part B excess charges are not that common. Additionally, Plan C is no longer available for beneficiaries who weren’t eligible for Medicare prior to January the 1st 2020.
- Plan D: this plan also covers additional benefits in comparison to Plans A and B. It covers the same things as Plan B plus skilled nursing facility care and 80% of foreign travel emergencies.
- Plan F: this plan is also one of the most comprehensive plans on the market. It provides the widest range of coverage for its beneficiaries. It covers 100% of all of the costs that are left by Original Medicare. However, it isn’t also available for those who weren’t eligible before the 1st of January 2020. This is because plans can no longer cover the Part B deductible.
- Plan G: this is the most comprehensive plan on the market that beneficiaries new to Medicare can get. The only thing that plan G doesn’t cover is the Part B deductible. Other benefits are covered 100%, besides the foreign travel emergency which is covered by 80%.
- Plan K: plan K covers 50% of most benefits like Part A hospice care and copay, Part B coinsurance or copay, first three blood prints, skilled nursing facility care coinsurance, and Part A deductible. The only things that are covered 100% are Part A coinsurance for a hospital stay of up to 365 days and Part B preventive care.
- Plan L: plan L is like Plan K also a cost-sharing supplement plan. It covers 75% of Part A deductible, Part A coinsurance for hospice care, Medicare Part B copays and coinsurance, 75% of the first three blood prints, and coinsurance for skilled nursing facilities. The only things that are covered 100% are Part B preventive care and Medicare Part A coinsurance.
- Plan M: from all three cost-sharing plans, plan M is the most comprehensive one. All benefits are covered 100%, only the Part A deductible is covered by 50%. Part B excess charges and Part B deductibles aren’t covered.
- Plan N: plan N is also one of the comprehensive plans. It covers 100% of the benefits, except of travel emergencies which are covered by 80%. It also don’t have Part B excess charges and Part B deductible.
For detailed Medigap plan comparison, check here.
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Though Medicare Supplement plans all have standardized benefits, each Supplement plan’s cost is based on the insurance company you choose and some other factors. There are three means through which insurance companies calculate the cost of Medicare Supplement plans. The three methods are 1) community-rated systems, 2) issue-age related, or 3) attained-age related. In community-rated policies, the Supplement Plan cost is fixed regardless of age, sex, or other factors.
In community-rated Supplement plans, beneficiaries will pay the same amount for each plan unless the price increases due to economic factors. As for issue-age-related systems, the Supplement Plan premium and other costs are based on your age when you purchased the Supplement Plan. The younger the age, the less premium you’ll pay for the plan. However, the premium may increase as you get older as a result of inflation. In attained-age-rated systems, your Supplement plan premium gradually increases as you get older. The cost is lower for younger people but becomes more expensive as they age.
Insurance providers usually offer discounts on Medicare Supplement plans due to certain reasons. For example, some plans may include discounts for non-smokers, women, and people who pay their premiums in advance each year.
Eligibility and Enrollment
You become eligible for Medicare Supplement during your Initial Enrollment Period, i.e., three months before you turn 65, and you enroll for Medicare Part B and three months after your 65th birthday. This period is called the Medigap Initial Enrollment period. During this window, you have a guaranteed right to purchase the plan. Insurance providers will not deny your application based on health as long as you qualify.
However, if you choose to enroll later, an insurance provider may reject your application based on health or other grounds. To register for a Medigap plan, you have a few options:
- Search for insurance providers that offer Supplement plans through the Medigap plan search tool on Medicare.
- Contact Medicare or insurance companies that offer Supplement plans online or on the phone.
- Enroll through a broker like us.
Better Place Insurance Group Can Help
If you have high out-of-pocket costs after enrolling in Original Medicare, Supplement plans are a good way of reducing these costs. At Better Place Insurance Group, we can help you get the best Medigap policy for your healthcare needs. You can find us in Lakeland, Florida, where we specialize in providing affordable insurance policies.