With 10 plans to choose from, it can be hard to know which Medicare Supplement plan is best for you. Yet it’s important to pick the right plan because it can be difficult or expensive to change plans later on.
Plan F, the most comprehensive plan, is also the most popular. But what is the best Medicare Supplement plan for your situation? Our guide below can help you decide.
What is Medicare Supplement Insurance?
Original Medicare consists of Part A, which covers hospitalization, and Part B, which covers other medical expenses. But Original Medicare doesn’t pay for everything. It doesn’t include prescriptions, nor does it cover vision or dental services. Many Medicare enrollees purchase a Medicare Part D prescription drug plan and/or dental and vision insurance to fill in these gaps.
But there are other important limits on what Parts A and B will cover. For example, Part A pays for 60 days in the hospital, but after that you must share the cost. Part B only pays 80 percent of your doctor bills and other medical costs. Parts A and B each have a deductible that you must meet before Medicare will begin paying. For 2018, the Part A deductible is $1340 and the Part B deductible is $183. Depending on your health, you can have high out of pocket costs if you only have Original Medicare.
Medicare Supplement, or “Medigap,” insurance pays some or all of the healthcare expenses that you would ordinarily be responsible for under Original Medicare. A Medigap plan may pay your Part A and B deductibles, the 20 percent coinsurance for medical expenses, or the cost of long-term hospitalization.
What is the Best Supplemental Insurance to have with Medicare?
Medicare Supplement insurance is sold by private insurance companies. There are 10 standard plans, identified by the letters A through N. Standardization means that each lettered plan always has the same benefits, no matter which insurance company is offering it. The alphabet soup of letters can be confusing. It’s important to know that Medicare Supplement Plans A through N are not the same as Medicare Parts A through D.
Which Medicare Supplement plan is best? Here’s an overview of the top plans:
- Plan F is the most popular plan and it also offers the broadest coverage, paying virtually everything that Medicare does not. Plan F’s benefits include an additional 365 days of hospitalization, the deductibles under Parts A and B, and the 20 percent coinsurance under Part B. It also pays for “excess charges.” This is a surcharge of up to 15 percent that doctors are allowed to bill if they think Medicare’s reimbursement rate is too low.
- High deductible Plan F has the same benefits as plan F, but in 2018 you must meet a deductible of $2,240 before the plan will begin paying. The high deductible plan has significantly lower premiums, but you will pay a greater share of your medical costs.
- Plan G is the second most popular plan, and also the second most comprehensive. The difference between Plan F and Plan G is that Plan G does not pay the Medicare Part B deductible.
- Plan C also does not pay the Part B deductible, nor does it pay for Medicare excess charges. Otherwise, it has the same benefits as Plan F.
In addition to these options, Plans N, M, L, K, D, B and A are available, each with a slightly different set of benefits. If you live in Massachusetts, Minnesota or Wisconsin, the plans are standardized differently.
How to Find the Best Medicare Supplement Insurance
To find the right Medicare Supplement plan, think about what you can afford to pay in premiums and your projected healthcare costs. There’s no one-size-fits all answer. There are, however, two things to keep in mind:
- Although the plans are standard, the monthly premiums are not. Different insurance companies may charge different rates for the exact same plan. Some types of plans will get more expensive as you age. That means you can save money by shopping around.
- It’s best to choose carefully and enroll during the six-month open enrollment period. It starts with the first month you are 65 or older and enrolled in Medicare Part B. If you sign up for a plan during this time, you can’t be turned away. You also can’t be charged more money because of your health. If you wait or change plans, your coverage will be medically underwritten, meaning you could face higher premiums or be turned down altogether because of health conditions.
The best way to choose a Medicare Supplement Plan is to work with a company that can search policies and rates for you, answer your questions, and explain the coverage. Fill out our form to get started with a free online quote.