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MEDICARE
SUPPLEMENTS

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Medicare Supplement (Medigap) Plan Comparison:

Why would I need a Medicare Supplement?

 

Many people mistakenly think that when they are eligible for Medicare they will no longer have to pay for any health care services. While Medicare does cover a wide range of care, it does not pay 100% of all medical bills. In general, Medicare covers approved expenses 80/20; Medicare pays 80% of the cost and the beneficiary (the person who has a Medicare plan) pays 20%. If you have original Medicare, you will have out-of-pocket expenses for healthcare.

That is where a Medicare Supplement (or Medigap) policy can help. Medicare Supplements are sold by private insurance companies and help pay some of the costs that original Medicare does not cover, such as copayments and coinsurance, which can easily add up.

Medicare Supplement plans work alongside of original Medicare as a secondary payor. Medicare pays its share of the Medicare-approved amount for covered health care costs, then the Medicare Supplement policy will pay its share. The amount you owe on that specific health care invoice will be reduced or eliminated completely. Medicare Supplements will only pay on Medicare-approved expenses. In general, the following items are usually not covered by Medicare: long-term care, vision or dental care, hearing aids, eyeglasses, or private-duty nursing.

​Medicare Supplement (Medigap) Facts:

  • You must have original Medicare Part A and Part B to purchase a Medicare Supplement plan.

  • Medicare Supplement policies will not work with Medicare Advantage plans.

  • A Medicare Supplement policy only covers one person.  If you and your spouse both want Medicare Supplement coverage, you will each have to buy separate policies.

  • Prescription drugs are not covered by Medicare Supplement policies. We recommend that you purchase a Part D Prescription Drug Plan.

  • Medicare Supplement policies are standardized and are identified in most states by letters (A-N).

  • Different insurance companies may charge different premiums for the exact same policy.  Use the plan letter to make sure you are comparing the same policies.

  • Medicare Supplement policies are guaranteed renewable even if your health status changes.  The insurance company cannot cancel your Medicare Supplement policy as long as you pay the premium.

  • During your Medicare Initial Enrollment Period (IEP), Medicare Supplement policies are guaranteed issue. Even if you are experiencing health challenges you can purchase a Medicare Supplement plan during IEP. However, after your IEP, most* Medicare Supplement policies are underwritten. For example, if someone is in good health when they turn 65 and decide to wait until they "need" a Medicare Supplement plan, it may no longer be available to them if their health condition is such that they do not pass underwriting. (*Carriers in some states offer a guaranteed issue Medicare Supplement plan that is available after IEP.)

Choosing Medicare Supplement (Medigap) Plan:

 

As mentioned above, Medicare Supplement policies are standardized. A Medicare Supplement Plan G with one carrier is the same as a Medicare Supplement Plan G with another carrier. So how can you decide which plan to choose? Here are some key points to consider:

  1. Premium - Each carrier sets the cost of their plan and decides how much to raise the rates. Medicare Supplement policies are designed to cover you for the rest of your life, as long as you keep paying the premiums. (They are not one-year policies like Medicare Advantage Plans.) Think long-term and, if possible, find out how much the carrier has traditionally raised rates through the years. Choosing the lowest starting rate is not always advisable. Some plans start off artificially low to attract your attention but raise their rates substantially in subsequent years. 

  2. Extra Benefits - While the standardized Medicare Supplement plans are identical, some carriers add on extra benefits like a dental, vision, hearing discount plan or a gym membership. Some carriers offer a gym membership for an additional cost. Check into any extra benefits that may be included with the plan.

  3. Customer Service and Claims Handling - A carrier's reputation also factors into the decision. Have their customers appreciated working with them? Check for star ratings and reviews if possible.

Need help choosing a plan? We assist seniors with selecting a plan. There is no cost for our services. We are here to help you select the plan that's right for you.

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Pros:

 

Predictable - There are fewer surprises when medical services are required, making it easier to budget. The out-of-pocket costs are more predictable.

 

Flexible - You can go to any provider who accepts Medicare. There is no need to search provider directories for in-network doctors.

Guaranteed Renewable - Some people experience a rise in healthcare needs as they age. A Medicare Supplement plan helps you prepare financially for the future because it is guaranteed renewable, as long as you pay your premiums.

"Golden Ticket" - It has been said that Medicare Supplement plans are the "Golden Ticket" of healthcare as there is less "red tape" to hold up recommended treatment. "Red tape" is referring to treatment authorizations, referrals, and approvals required by some plans.

Cons:

 

Cost - There is a monthly premium for a Medicare Supplement plan, in addition to the Part B (outpatient) premium and the Part D (prescription drug) premium. For some, the costs of a Medicare Supplement plan can be prohibitive. Others simply do not wish to pay a monthly premium when they may only see their physician once a year.

Dental, Vision, Hearing - Medicare Supplement plans do not have dental, vision, hearing insurance coverage. Some offer a dental, vision, hearing discount plan. Either way, whether you purchase dental, vision, hearing insurance or whether you pay out-of-pocket for your dental, vision, hearing exams and services, there is an additional cost.

Fitness - Some Medicare Supplement plans offer gym membership, others do not. Some may offer it for an additional fee. Bottom line, if going to the gym is a part of your wellness plan, you may incur out-of-pocket expense for a gym membership.

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