What is Medicare Supplement Insurance?

Original Medicare (Medicare Parts A and B) is provided by the federal government. Medicare Supplement Insurance is an optional addition to Original Medicare. They are designed to help you cover out-of-pocket costs remaining from Original Medicare coverage, like copays, coinsurance, and deductibles. These plans are offered and managed by private insurers approved by Medicare.

You may have heard of Medigap and are wondering, what is a Medigap plan? Medigap is simply another name for Medicare Supplement Insurance. There are 10 Medigap plans. Medigap plans are all standardized, meaning that each plan letter (Plan A for example) have the same benefits. However, different plan letters (Plan A compared to Plan K), have different benefits. These plans are standardized differently in Massachusetts, Minnesota, and Wisconsin.

Medigap eligibility is based on your eligibility for Original Medicare. If you’re enrolled in Medicare Part A and Medicare Part B, you are typically eligible for a Medigap plan.

You can learn more about and compare the Medigap Plans available in your area with the HelloMedicare Guided Path tool.

What Does Medicare Supplement Insurance Cover?

A Medigap plan (i.e. Medicare Supplement Insurance coverage) only supplements your existing Original Medicare benefits by helping with copays, coinsurance, and deductibles. All Medigap plans cover all or some basic costs including:

  • Part A coinsurance and hospital costs up to an additional 365 days after Medicare benefits are used up
  • Part B coinsurance or copay
  • Blood (first 3 pints)
  • Part A hospice care coinsurance or copay

Some Medigap plans also cover all or some additional out-of-pocket costs, including:

  • Skilled nursing facility care coinsurance
  • Part A deductible
  • Part B deductible
  • Part B excess charge
  • Foreign travel exchange (up to plan limits)
  • Out-of-pocket limit

Certain Medigap plans in some states also offer a high-deductible option. These plans have lower premiums in exchange for a high-deductible.

Because Medigap plans in Massachusetts, Minnesota, and Wisconsin are standardized in different ways, plan options and benefits will be different than those listed above.

How Much Does Medicare Supplement Insurance Cost?

Unlike Original Medicare, Medigap plans are offered by private insurers. That means private insurance companies determine the monthly premiums for each of their plans. Private insurance companies can price Medigap plans in 3 different ways: community-rated, issue-age-related, and attained-age-rated.

  • Community-rated plans generally charge everyone with the same plan the same amount, regardless of age. Premiums may change based on inflation or other factors.
  • Issue-age-rated plans base premiums on the age when you first purchased the plan. Premiums are lower for people who buy when they’re younger (65) and may vary based on inflation and other factors.
  • Attained-age-rated base premiums on your current age. Premiums are low when you are young (65) but increase as you age, as well as increasing with inflation and other factors.

What you pay for a Medigap plan depends on a number of factors. These factors include how the plan is priced, which plan or benefit options you choose, whether or not you go through medical underwriting (something you can bypass if you enroll when your Part B coverage starts), and if you select a high-deductible plan.

Keep in mind that in order to enroll in a Medigap plan, you must be enrolled in Original Medicare (both Parts A and B). This means that you will need to continue to pay your Medicare Part B premiums to remain eligible for your Medigap plan.

When and How Can I Sign Up for Medicare Supplement Insurance?

When you first become eligible for Medicare, you are automatically enrolled in Original Medicare (Parts A and B). You can buy a Medigap plan during your 6-month Medigap Open Enrollment Period. This period starts when you enroll in Part B. Around this same time, you should receive your Medicare Card in the mail, which contains your unique Medicare number. It is helpful to have this card and number available when you begin enrollment in Medigap.

You can also enroll in Medigap at any time after the enrollment period, but you may be subject to medical underwriting. If you are found to have past or current health issues during medical underwriting, you may be denied coverage, given a delayed start time to your coverage, or charged more for your plan.

Because costs and coverage vary by plan letter, it’s important to understand each plan’s benefits. Start by researching the Medigap plans available in your area using HelloMedicare’s personalized Guided Path tool. Be sure to compare monthly premiums, how insurance companies price each plan, and plan letter benefits that suit your needs.

When you find a plan that fits your healthcare needs and your budget, HelloMedicare, HealthMarkets and Golden Outlook can help you enroll in a Medigap plan too. Simply click “enroll” on the plan description page. Have your Medicare Card ready when you begin the enrollment process.

We understand that choosing a plan can be overwhelming. That’s why HelloMedicare, HealthMarkets and Golden Outlook are standing by to help. Our licensed insurance agents can answer many questions you have, from “What is a Medigap plan?” to “How do I sign up for Medicare Supplement Insurance?” to “What plan is right for me?” Just ask.