Medicare is the federal health insurance program in the United States for citizens above the age of 65. It includes three parts- Part A (Hospital Insurance), Part B (Medical Insurance), Part D (Prescription drug coverage). It is important to note that the Medicare does not cover all the expenses like copayments, coinsurance, and annual deductibles. Citizens can consider opting for a Medicare Supplement plan, commonly referred to as Medigap. The Medigap covers the expenses which are not met by the Medicare. The Medicare Supplement plans are offered by private insurance companies and it is intended to address the gaps not met by the Original Medicare.
Salient Features of Medicare Supplement Plan
Medigap plans supplement the original Medicare hence the person has to be enrolled in Original Medicare Part A and Part B and continue to be enrolled in the same to be eligible for Medigap plan. Generally, the citizens under 65 years of age will not be able to get Medicare Supplement plan. The Medicare Supplement plan covers only one person hence separate policies have to be bought for spouses. The Medigap policies are sold by private insurance companies who are licensed to carry operations in the respective state. The citizens have to pay a monthly insurance premium for buying the Medicare Supplement plan. Another benefit of the standard Medicare Supplement plan is that it cannot be canceled even if the person has health issues. It is guaranteed renewable and continues to be in force till the premium is paid.
If someone has both the Original Medicare and Medigap plans, then the Original Medicare will pay first and the remaining expenses not met by it will be filled in by the Medigap plan. For example for an ambulance bill of $3000, the Medicare Part B will pay 80% of the bill and the Medigap plan will pay the remaining 20% coinsurance of the ambulance bill.
Benefits Covered by Medicare Supplement Plans
There are 10 standardized Medigap plans represented by the letters A to N. The premiums for different variants of the Medigap plans may vary, but the benefits covered as the same irrespective of the location. Usually, the Medigap plans cover benefits which include- Medicare Part A coinsurance and hospital costs, Medicare Part B coinsurance or copayments, Part A hospice care insurance or copayment, and Blood (first 3 pints).
Exclusions from Medicare Supplement Plans
Generally, the 2019 Medicare Supplement plans do not cover health services and supplied related to – long-term care (care in a nursing home), routine eye and dental care, hearing aids, eyeglasses, private nursing, and drug prescription.