Table of Contents:
- What is Medigap?
- Medigap Glossary of Terms
- Medigap Coverage
- Medigap Costs
- Medigap and Other Insurance Plans
- How to Buy a Medigap Policy
- Medigap in Minnesota
- Traveling with Medigap
WHAT IS MEDIGAP?
Medigap is a Medicare Supplement Insurance plan that pays for extra costs not typically covered by Original Medicare. This generally includes copayments, coinsurance, and deductibles. Medigap plans may also cover medical care needed when traveling outside of the United States, among other costs.
Read More: What is Medigap and Do I Need It?
Medigap plans are sold by private insurance companies that have been licensed in your state. Medigap is different from Medicare Advantage Plans and may not cover Part D prescription medication costs. The specific items that are covered by your Medigap plan will vary depending on which plan you choose.
MEDIGAP GLOSSARY OF TERMS
- Medigap: Medicare Supplement Insurance that fills gaps in Medicare coverage.
- Copayment: An amount you may be required to pay for covered procedures, medications, and other medical costs after meeting your plan’s deductible.
- Coinsurance: An amount, usually a percentage of total costs, you may be required to pay as your share of the cost for services after meeting your plan’s deductible.
- Deductible: The amount you must pay for health care or prescription drugs before other insurance (Original Medicare, a Medicare Advantage Plan or Part D drug plan, or other insurance) begins to pay part or all of costs.
- Preventative Care: Health care to prevent illness or detect it at an early stage.
- Usual and Customary Fees: The amount of money that Medicare determines is the normal or acceptable range of payment for specific healthcare services or procedures.
What Are the Types of Medigap Plans?
Medigap plans can be categorized as:
- Medicare Select: This is a Medigap plan that limits coverage to a predetermined network of medical providers and health care facilities.
- Standardized: This Medigap plan has no set network. You will not need to seek prior authorization for Medicare-approved services. As long as your health care provider participates in Medicare, your Medigap plan will cover your care.
MEDIGAP IN MINNESOTA
Medigap plans can vary drastically throughout the country. In most states, different Medigap plans are identified by letters (A, B, C, D, F, G, K, L, M and N). The state of Minnesota is somewhat unique when it comes to Medigap policies.
The basic benefits that you’ll receive in Minnesota cover items like inpatient hospital care, Part B coinsurance, the first 3 pints of blood each year, Part A hospice and respite care cost-sharing, as well as Parts A and B home health services and supplies cost-sharing.
Does Medigap Cover Prescription Drugs?
Although this varies between plans, most Medigap policies do not cover:
- Long-term care
- Vision care and eyeglasses
- Dental care
- Hearing aids
- Private-duty nursing
There is no standard cost for Medigap plans. Each insurance company that offers Medigap sets its premiums. When deciding between Medigap plans, make sure to understand how the insurer prices its policies. This can affect how much you pay now, and also how much you could pay in future years.
Medigap premiums are set in one of three ways:
- Community-Rated: Also known as “no age-rated.” In these Medigap plans, the same monthly premium is charged to everyone with the policy, regardless of their age. Premiums may go up due to inflation and other factors, but age is not a factor.
- Issue-Age-Rated: Also known as “entry age-rated.” In these plans, your premium is determined based on your age when you buy the Medigap policy.
- Attained-Age-Rated: The premiums in these plans are based on the policyholder’s current age and will go up as you get older.
Read More: 7 Medicare Facts You May Not Know
Other factors could influence Medigap policy costs, such as:
- Discounts offered by the insurance company, such as discounts for non-smokers or for people who pay premiums electronically.
- High-deductible plan options generally have lower premiums but require you to pay a certain amount of all medical expenses before Medigap coverage starts.
- A more limited provider list (Medicare Select plans).
Most Medigap plans are guaranteed renewable plans. This means that benefits will remain consistent, even if your health needs change. As long as you continue to pay the premium, the insurance company cannot cancel your Medigap policy. (The premiums may change, however.)
MEDIGAP AND OTHER INSURANCE PLANS
Medigap and Medicare Advantage Plans
Both Medigap and Medicare Advantage Plans provide coverage through a private insurance company. Medicare Advantage Plans (also known as Medicare Part C) generally cover Medicare Parts A, B, and D. In addition, Medicare Advantage Plans usually provide dental, vision, and wellness benefits.
Medigap plans don’t work with Medicare Advantage Plans – you can’t use Medigap to pay Medicare Advantage premiums, copays, and deductibles. Therefore, if you have a Medigap policy and decide to change to a Medicare Advantage plan, you would need to cancel the Medigap plan.
If you join a Medicare Advantage Plan for the first time and are unsatisfied with the plan, federal law grants you the right to buy a Medigap policy. This right only applies if you return to Original Medicare within 12 months of joining the Medicare Advantage Plan.
Are you unsure about which Medicare plan is right for you? Contact Twin City Underwriters.
Read More: Should I Get Medicare Advantage or Medigap?
Medigap and Medicare Part D Plans
Medigap plans do not cover prescription drug costs. In order to obtain drug coverage and avoid penalties, you would need to purchase a separate Medicare Part D plan. Learn more about Medicare Part D here.
HOW TO BUY A MEDIGAP POLICY
The best time to buy a Medigap policy is when you’re first eligible. This six-month Medigap Open Enrollment Period automatically begins the first month you have Medicare Part B, and when you’re at least 65 years old.
If you don’t enroll in Medigap at that time, you can buy a policy during the annual open enrollment period. You may be able to buy a policy outside of open enrollment, depending on your situation. Contact Twin City Underwriters to discuss your options.
There are a few simple steps involved in purchasing a Medigap policy:
- Decide what plan you want
- Plans vary based on what benefits you want. In most states, they are named by letters A-N. You’ll need to consider your current and future health care needs.
- Choose a policy
- Looking at the policies in your area, you will need to choose one that aligns with your healthcare needs. If you need help figuring out what policy works best for you, get in touch with Twin City Underwriters.
- Buy a policy
- Once you’ve decided on a policy and insurer, Twin City Underwriters can help you apply. The insurance company should provide the information you need. If you have any questions, we’re here to help!
TRAVELING WITH MEDIGAP
If you’re traveling outside the United States, you could be entitled to additional coverage for emergency health care services or supplies.
With Medigap plans, you may receive coverage benefits such as:
- Foreign travel emergency care.
- Coverage for 80% of billed charges for certain medical expenses while in emergency care outside of the U.S.
Though you may be covered, foreign travel emergency coverage with Medigap policies has a lifetime limit.
Talk with an insurance broker for more information on traveling with Medigap. You’ll get personalized advice that meets your needs.
WE’RE HERE TO HELP!
Get all the answers to your Medicare questions in our Medicare Resource Guide.
Do you have questions about Medicare, and which plan is right for you? Twin City Underwriters offers free informational Medicare webinars and one-on-one meetings with agents where you can ask questions and get personal answers. We can help you select the right coverage for your needs. To attend a webinar or set up an appointment, call us toll-free at 1-800-507-6778 or send us a message.