Wise Insurance Logo

Call Us

What is Supplemental Life Insurance (Medigap)?

College professor explaining Medicare Supplements
Medicare Supplements – Original Medicare, while offering great benefits, is not enough coverage for the average person. If you are a Medicare beneficiary, you have two options to reduce your medical expenses. You can either enroll in a Medicare supplement plan or a Medicare Advantage plan. There is quite a lot to know about each of these options, but today, we’re going to focus on Medicare supplement plans. After reading this article, you’ll understand what Medicare supplements are, what coverage they provide, who is eligible to enroll, and how much these plans cost.

What is a Medicare supplement?

Medicare supplements are also called Medigap plans. Their name is derived from what they’re designed to do: fill in the “gaps” left by Original Medicare (Part A and Part B). If you enroll in a Medicare supplement, it will become your secondary insurance. There are ten supplements to choose from, plus a couple of high-deductible options. The plans are called by an alphabet letter and consist of Plans A, B, C, D, F, G, K, L, M, and N. There is also a high-deductible Plan F and high-deductible Plan G. All of them reduce your medical expenses, but some offer more coverage than others. Medicare supplements are easy to understand because the federal government has standardized them. What that means is that their coverage and benefits stay the same from one year to the next and across all states and insurance companies. So, for example, you can buy Plan G in Texas from Company or Plan G in California from Company B, and you’ll have exactly the same coverage. Plus, unlike Medicare Advantage plans, your coverage will never change. You don’t have to review your plan each year, and it will automatically renew.

How do Medicare supplement plans work?

After Original Medicare pays on a claim, it is sent to your Medigap plan carrier. The amount they’ll pay for the claim depends on which of the letter plans you have. A nice feature of Medigap plans is that they will work with any provider who accepts Medicare assignment. Since about 96% of providers accept Medicare, you’ve got a lot of freedom to choose your healthcare team. This is also helpful to beneficiaries who like to travel. You won’t have to worry about getting permission from your plan to see an out-of-network provider, nor will you pay more if you receive care in another state.
couple of seniors traveling and taking a selfie in a beautiful beach with a mountain knowing that their Medicare Supplement Plans work.
Beneficiaries who like to travel. You won’t have to worry about getting permission from your plan to see an out-of-network provider.
Beneficiaries who like to travel. You won’t have to worry about getting permission from your plan to see an out-of-network provider. After you’ve enrolled in a Medicare supplement plan, your plan with automatically renew each year as long as you pay the monthly premiums. Failure to pay your premium is the only reason your plan can disenroll you.

What do Medicare supplements cover?

Medicare supplements pay costs that remain after Original Medicare pays. If you haven’t looked into what those costs could be, it’s a good idea to get familiar with your coverage under Parts A and B. However, we’ll mention the basics here. The costs that your Medicare supplement plan could pay include:
  • Part A deductile
  • Part A coinsurance and hospital costs, including an additional 365 days after your benefits are exhausted
  • Skilled nursing facility care coinsurance
  • Part A hospice care coinsurance
  • Part B deductible
  • Part B coinsurance and copayments
  • Part B excess charges
  • First three pints of blood
  • 80% of a foreign travel emergency (up to plan limits)
Of those costs, the ones that your supplement will pay depends on which of the plans you have. For example, Plan F will pick up all of those costs, leaving you with no out-of-pocket costs. Plan G has the next best coverage, covering all but the Part B deductible.

What is not included in Medicare supplements?

The one disadvantage to Medicare supplements is that they do not include coverage for anything not approved by Medicare. If Parts A or B don’t cover it, neither will your Medigap policy. If you choose to enroll in a Medigap plan, you’ll need to enroll in a separate Part D prescription drug plan. Even if you do not currently take any prescriptions, you need to enroll to avoid penalties later. Plus, there are limited enrollment times, so if you find yourself needing drug coverage outside of one of those enrollment periods, you will not be able to get the coverage you need. Medicare supplements also don’t include the extra benefits you’ll often find in Medicare Advantage plans. Services like dental, vision, and hearing care, meal delivery, gym memberships, transportation, etc. However, you may be able to get some of these extras covered in a separate policy, which can be very affordable.

Who can I enroll in Medicare supplement insurance?

If you are enrolled in Parts A and B, you can enroll in a Medigap plan. The best time to enroll is during your Initial Enrollment Period or IEP. This is the 7-month window around your 65th birthday. Your IEP is the best time to enroll because you will have guaranteed issue rights to any Medicare supplement plan you’d like. Outside of your IEP, you will likely need to go through medical underwriting to get one of these plans. Certain situations qualify you for a Special Enrollment Period or SEP. If you qualify, you’ll have guaranteed issue rights to some (but not all) Medigap policies. In addition, some states have their own rules regarding guaranteed issue rules. There are no specific enrollment periods that pertain to Medicare supplements. You can choose to enroll, disenroll, or change your plan at any time.

How much do Medicare supplement plans cost?

The best Medicare supplement plans do come with a higher price tag. Your premium will depend firstly on which of the ten plans you choose. Plan F has the most coverage, so it has the highest premiums. In addition, your monthly premium will depend on where you live, your age, gender, and tobacco use. The insurance company gets to set its own premiums for their plans. Some are known to be more expensive than others, and some increase their rates at a quicker pace. It’s important to shop around at different carriers to make sure you’re getting a competitive price. Want to learn more about Medicare supplement insurance plans? Give us a call! Our licensed insurance agents specialize in all things Medicare and will make sure you find a plan that will work well for you.

Share this article

Table of Contents

Still Have Questions?

We strive to educate and empower our clients to make the best decisions for their health insurance coverage.

Still Have Questions?

If you’ve enrolled in Medicare and want to learn more about your coverage, then we’re here to help. Feel free to reach out to us today and we will find a time to talk more about your specific coverage and the ways you can use it.

Recent Blog Posts