Medigap is a supplemental insurance plan that was designed to cover the gaps in coverage left by Medicare. Unlike Medicare, however, Medigap is not a government-sponsored insurance program.
It is sold through private insurance companies and you purchase the policy on your own. Federal and state regulation of Medigap helps keep it affordable and ensures that the individual policies offer standardized benefits.
How Medigap Works
Because Medicare does not provide coverage for all health and medical expenses, Medigap policies are used to pay for expenses not covered by Medicare. In addition to paying for these expenses, you can also use a Medigap policy to pay for regular Medicare expenses such as your deductible and co-pays.
There are 12 standardized Medigap policies, referred to simply as “Plan A,” “Plan B,” and so on, that are authorized by the federal government. Each type of policy offers specific benefits to make them easy to compare coverage. All 10 are not offered in every state, as each state may decide how many-and which-policies to make available to residents.
Plan A provides the most basic coverage, and it is available in every state and through every insurance company that sells Medigap. Each successive plan offers the same basic benefits, with additional coverage at an additional expense.
Medigap policies are only available to Medicare beneficiaries. Generally, you must have both Medicare Part A and Part B. If you are married, your Medigap policy will not cover your spouse; he or she must purchase another policy to be covered.
What You Need to Know About Purchasing a Medigap Policy
It is strongly advised that you purchase Medigap within the first six months that you become covered by Medicare. During this six-month window, insurance companies that sell Medigap are obligated to sell you the policy that you want, regardless of whether you are considered high risk or whether you have a preexisting condition on record.
Additionally, once you purchase a policy, no matter which insurance company you buy it through, it is guaranteed renewable, and it cannot be canceled for as long as you keep current on premium payments.
If you enroll in Medicare Part C (aka Medicare Advantage), be advised that your Medigap policy will not pay benefits. So choose one or the other-but don’t pay for both.
When you are considering the purchase of a Medigap policy, the insurance company must provide you with literature that shows what each plan does and does not cover. Be sure to do your own research as well. The cost for each plan will vary from company to company, so once you decide on which plan you want, shop around for the best price.
Learn More About Medigap
Whichever plan you choose, try to make sure that between your Medicare and Medigap policy, you have the most comprehensive coverage that you can afford. For more information on choosing a Medigap policy, visit Medicare.gov and download Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.
Written by senior housing writer Nikki Jong.