Understanding Medicare Gap Insurance

Medicare is a federal government insurance program primarily designed for people over 65, but it also covers younger people with certain disabilities. It provides coverage for most medically necessary services, including hospital stays, doctor visits, and prescription drugs. However, there are gaps in coverage that can leave beneficiaries with significant out-of-pocket costs. That’s where Medicare gap insurance comes in – also known as Medigap.

What is Medicare Gap Insurance?

Medicare gap insurance is a type of supplemental insurance policy that helps cover some of the costs that Medicare doesn’t pay for. Medigap policies are sold by private insurance companies, and they work alongside your Medicare coverage to help fill in the gaps.

There are ten standardized Medigap plans available in most states, labeled A, B, C, D, F, G, K, L, M, and N. Each plan offers a different combination of benefits, so it’s important to understand what each plan covers before choosing one.

What Does Medicare Gap Insurance Cover?

The benefits covered by Medigap policies depend on the plan you choose. However, some common benefits include:

It’s important to note that Medigap policies do not cover prescription drugs. If you want coverage for prescription drugs, you’ll need to enroll in a separate Medicare Part D plan.

How Much Does Medicare Gap Insurance Cost?

The cost of Medicare gap insurance varies depending on the plan you choose and where you live. In general, the more comprehensive the coverage, the higher the premium. However, it’s important to remember that even though you will have to pay a monthly premium for Medigap coverage, it may save you money in the long run by covering some of the costs that Medicare doesn’t pay for.

Who Needs Medicare Gap Insurance?

If you have Medicare Part A and Part B, you may want to consider purchasing a Medigap policy to help cover the costs that Medicare doesn’t pay for. This is especially true if you anticipate needing a lot of medical care in the coming year or if you have a chronic condition that requires ongoing treatment.

Medicare gap insurance can also be a good option if you travel frequently outside of the United States. Most Medigap plans provide some coverage for emergency medical care received outside of the country.

How to Choose a Medicare Gap Insurance Plan

When choosing a Medigap plan, it’s important to consider your healthcare needs and your budget. Here are some questions to ask yourself:

• What are my current healthcare needs? Do I anticipate needing a lot of medical care in the coming year?
• How much can I afford to pay for a monthly premium?
• Do I travel frequently outside of the United States?
• Do I want the freedom to see any doctor who accepts Medicare, or am I willing to choose from a network of providers?

Once you’ve answered these questions, you can compare the benefits and costs of the different Medigap plans in your state to find the one that best fits your needs.

FAQs

Can I Buy Medicare Gap Insurance Anytime?

No, you can only buy Medigap insurance during certain enrollment periods. The best time to buy a Medigap policy is during your Medigap open enrollment period, which begins on the first day of the month in which you are both 65 or older and enrolled in Medicare Part B, and lasts for six months. During this time, you can buy any Medigap policy sold in your state, regardless of your health status, and the insurance company cannot charge you more because of any pre-existing conditions.

What Happens to My Medicare Gap Insurance if I Move?

If you move to a new state, you may be able to keep your current Medigap policy, but your premium may change. However, if you move to a different area within your state, your Medigap policy should stay the same.

Can I Change My Medicare Gap Insurance Plan?

Yes, you can change your Medigap policy at any time, but there are some restrictions. If you want to switch to a different Medigap policy, you will generally have to go through medical underwriting, which means the insurance company can review your health status and may charge you more based on any pre-existing conditions.

Do I Need to Renew My Medicare Gap Insurance Policy Every Year?

No, once you purchase a Medigap policy, it is automatically renewed each year as long as you continue to pay your premiums on time.

Is Medicare Gap Insurance the Same as Medicare Advantage?

No, Medicare gap insurance is not the same as Medicare Advantage. Medicare Advantage plans are a type of Medicare health plan offered by private insurance companies that contract with Medicare to provide Part A and Part B benefits. These plans may also include additional benefits, such as prescription drug coverage, dental, vision, and hearing care. Medicare gap insurance, on the other hand, supplements your original Medicare coverage and only covers certain out-of-pocket costs.

Conclusion

Medicare gap insurance can be a valuable tool for helping to cover the costs that Medicare doesn’t pay for. By understanding the benefits and costs of the different Medigap plans available in your state, you can make an informed decision about which plan is right for you.