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Medicare Supplement (Medigap) Plans


Medicare Supplement plans cover some of the healthcare costs Original Medicare leaves behind. These plans fill your coverage gaps, including copayments, deductibles, and coinsurance. As a result, when you have a Medicare Supplement (Medigap) plan, you will have little-to-no out-of-pocket costs for Medicare-covered services and equipment.

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What Are Medicare Supplement (Medigap) Plans?

Medicare Supplement plans are supplemental insurance policies that cover healthcare costs Original Medicare (Part A and Part B) leave behind. Providers bill Medicare first and charge the remaining amount to the Medigap carrier.

In 47 states, Medicare Supplement (Medigap) plans are identified by letters A through N. Each lettered plan offers a different coverage level. This type of coverage is also known as Medigap.

What is a Medicare Supplement?

The federal government standardizes Medicare Supplement plans, meaning benefits for each lettered plan are consistent across all insurance companies nationwide. Before you begin to compare Medigap plans, it is helpful to familiarize yourself with the Medigap pricing methods that carriers use.

Your carrier’s pricing method can affect your Medicare Supplement plan’s monthly premium rates and how it will increase over time. Additionally, it is essential to note that if you have a Medigap policy and your spouse needs coverage, they must buy a separate policy.

Generally, Medicare Supplement plans offer individual coverage, which is why you and your spouse cannot share a policy. However, not being able to share a policy offers more positives than negatives for spouses. In this case, each spouse can obtain a plan to fit their unique health and budget goals.

For example, Ronald and Carolyn are a married couple turning 65 and enrolling in Medicare. Ronald is very healthy and exercises every day. Carolyn was recently diagnosed with heart disease and had trouble walking up and down the stairs in their home.

When enrolling in a Medicare Supplement plan, Ronald wants something low-cost to cover him in an emergency. On the other hand, Carolyn needs to enroll in a plan that offers more comprehensive coverage, as she goes to the doctor at least once a month.

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Difference Between Medicare Supplement Plan and Medigap Plans

If you are wondering what the differences are between a Medicare Supplement plan and a Medigap plan, you may be shocked to find out that they are the exact same type of insurance plan. A Medigap plan and a Medicare Supplement plan are two names for one type of insurance coverage. Thus, the names are interchangeable. If you hear someone speaking about Medigap Plan G and Medicare Supplement Plan G, they are talking about the same coverage.

So, you may be wondering why there are two names for the same plan. This is because Medicare Supplement plans fill the gaps that Original Medicare coverage leaves behind. This is how we get the term Medigap, as in Original Medicare gaps. So, Medigap is merely a shortened version of the formal name, Medicare Supplement. If you are trying to decide between enrolling in a Medigap plan or a Medicare Supplement plan, you already have the answer you are looking for. You do not need to decide between Medicare Supplement and Medigap plans because they are one and the same.

How Do Medicare Supplement Plans Work?

Medicare Supplement (Medigap) plans work by supplementing your Original Medicare coverage. Thus, providing you with more comprehensive healthcare coverage.

Medigap plans aim to achieve a single goal: to lower the out-of-pocket costs for Medicare enrollees. Once you enroll in a Medigap plan, you will have a better understanding of your annual out-of-pocket medical costs, reduce your risk for unexpected healthcare bills, and receive an overall higher level of Medicare insurance coverage.

Depending on the Medicare Supplement plan in which you enroll, you may be able to eliminate unexpected medical costs altogether. Plus, there is a plan for everyone.

The amount of care you receive each year will be the biggest determining factor as to which Medigap plan you should choose. In addition to predictable costs, you receive several additional benefits when you enroll in a Medicare Supplement plan.

Thus, Medicare Supplement plans are a great addition for anyone with Original Medicare.

Can You Have Two Medicare Supplement Plans?

Since Medicare Supplement (Medigap) plans cover the gaps Original Medicare leaves behind, you may think that enrolling in multiple Medigap plans will save you more money in the long run. However, enrolling in two plans is not necessary. In reality, enrolling in more than one Medicare Supplement plan at the same time is not legal in the U.S.

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According to federal law, you are only allowed to enroll in one Medigap plan at a time. Thus, you should enroll in the best plan for your healthcare needs and budget.

If you were to enroll in more than one Medigap plan at a time, not only would you be at risk for both plans saying the other is responsible for your coverage and receiving no coverage at all. You would also risk being kicked off both Medigap plans. Thus, you would lose your supplemental Medicare coverage and be responsible for the remaining 20% through Medicare Part A and Part B copayments, which can quickly add up.

Additionally, if you enroll in a Medicare Supplement plan outside of your Medicare Supplement Open Enrollment, you may be subject to underwriting health questions. This means that you could be denied Medigap coverage due to pre-existing health conditions. So, enrolling in the best plan the first time is key to saving yourself the most money in the long run.

What Do Medicare Supplement Plans Cover?

Medicare Supplement (Medigap) plans cover all the same services Original Medicare. Once Original Medicare pays its portion, those without a Medigap plan have a deductible, copayments, or coinsurance. However, you are no longer responsible for these out-of-pocket costs with Medicare Supplement plans.

Depending on your Medigap plan, the policy will cover most or all your leftover costs from Original Medicare. Refer to the Medicare Supplement comparison chart above to see what each lettered plan covers and what you will be responsible for paying.

These benefits include:

  • No network restrictions – you can see any doctor or visit any hospital that accepts Original Medicare
  • No requirement for referrals to see a specialist
  • Coverage is the same in all states
  • 12 Unique plan options available to fit your needs/budget
  • Guaranteed renewable plans – your carrier cannot drop you for any reason other than not paying your premium
  • Medigap plans help reduce your out-of-pocket costs

If you are looking for a plan that prioritizes convenience and ease, a Medicare Supplement plan may be right for you.

How Medicare Supplement Insurance Benefits Work

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What is the Most Popular Medicare Supplement (Medigap) Plan?

Not all Medicare Supplement plans share the same benefits. So, some plans tend to attract more enrollees than others. Due to their comprehensive coverage, Medigap Plan F, Plan G, and Plan N are the most popular Medicare Supplement plans nationwide.

If you refer to the Medigap comparison chart above, you will notice that these three plans offer the most comprehensive coverage of all Medigap plans.

Depending on your budget and healthcare needs, one of these three plans may work best for you. However, not all Medicare beneficiaries are eligible for all the top options. Those who received Medicare after January 1, 2020, are not eligible for Medicare Supplement Plan F. So if you are new to Medicare, your most comprehensive option is Medicare Supplement Plan G.

How Do Medicare Supplement Plans Work with Original Medicare?

Medicare Supplement plans work with Original Medicare by covering the costs left behind for beneficiaries to pay.

Once you enroll in Original Medicare, you become eligible for a Medicare Supplement (Medigap) plan. When you have Original Medicare, you do not have 100% coverage for Medicare-covered services. This leaves beneficiaries with out-of-pocket costs that can quickly add up.

To offset these costs, beneficiaries can enroll in Medicare Supplement plans. Once Original Medicare pays its portion of the bill, your plan will pay second. Depending on your plan, you may not pay anything out-of-pocket once you meet your plan’s deductible.

After factoring in your monthly premium, you will begin saving you money as early as your first doctor appointment of the year.

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What is Not Covered by Medicare Supplement (Medigap) Plans?

Medicare Supplement plans do not cover anything Original Medicare does not cover. These plans are a proper secondary coverage to Original Medicare. Thus, the plans only pay after Original Medicare pays its portion. Each Medicare Supplement plan covers a different percentage of costs. You can see these costs in the comparison chart above.

For example, the most notable benefits that do not receive coverage are dental, vision, hearing, and prescription drugs.

However, you are not out of luck for these benefits when you enroll in a Medicare Supplement plan. Beneficiaries often enroll in stand-alone dental, vision, and hearing plans and Medicare Part D prescription drug coverage alongside their Original Medicare and Medicare Supplement coverage.

When is the Best Time to Enroll in a Medicare Supplement?

To be eligible for a Medicare Supplement (Medigap) plan, you must enroll in Original Medicare. To qualify for Original Medicare, you must be a U.S. citizen or legal resident for at least five years and any of the following:

  • Age 65 or above
  • Collect Social Security Disability Income (SSDI) benefits for at least two years
  • Diagnosed with ESRD or ALS

After enrolling in Original Medicare, the best time to sign up is during your six-month Medicare Supplement Open Enrollment Period. This enrollment period begins on the first day of the month your Medicare Part B goes into effect.

When you enroll in a Medicare Supplement plan during this time, you have guaranteed issue rights. This means pre-existing conditions cannot affect your admittance to the plan. Carriers cannot decline your coverage based on your health history. You may still enroll in a Medicare Supplement plan outside your Medigap Open Enrollment Period window, but you may be subject to health questions.

How Much Do Medicare Supplement (Medigap) Plans Cost?

Medicare Supplement premium prices vary by ZIP Code and carrier. A policy of the same plan letter may cost more in one ZIP Code than another or from one carrier to the next. Depending on the option you choose, the average monthly premium can range between $40 and $300.

Several factors determine your Medicare Supplement plan’s premium. Depending on your health and budget needs, one of these plans could save you from high unexpected medical costs. Although premium price is crucial when choosing a Medigap plan, it is not the only factor. You should also understand coverage and other out-of-pocket expenses.

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When choosing a Medigap plan, it is essential to understand the carrier’s pricing method to determine the cost of your coverage. There are three main pricing methods. They include:

  • Community-rated – Carriers who use community rating do not base rate increases on gender or age. Premium increases are the same across the board for anyone with a plan using the community-rating method.
  • Issue-age – Carriers who use issue-age rating base their premium on the age you are when you enroll in the plan. Your price will always be consistent with that of a person enrolling at the age you were when you signed up.
  • Attained age – Carriers who use attained age ratings will increase your premium based on your current age, regardless of how old you were when you enrolled in the plan.

Whichever pricing method your carrier uses, your Medicare Supplement plan’s premium will increase due to outside factors such as annual inflation.

How to Enroll in Medicare Supplement (Medigap) Plans in 2023

If you are considering adding a Medicare Supplement plan to your Medicare benefits, call us at the number above.

If calling now is not an option, complete our online rate form, and one of our agents will reach out to you with your individualized quotes. Our agents will need to collect additional information to provide you with the most accurate rate quote for all your supplemental options.

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Sources:

MedicareFAQ is dedicated to providing you with authentic and trustworthy Medicare information. We have strict sourcing guidelines and work diligently to serve our readers with accurate and up-to-date content.

  1. When Can I Buy Medigap, Medicare. Accessed February 2022.
    https://www.medicare.gov/supplements-other-insurance/when-can-i-buy-medigap
  2. Medigap, Centers for Medicare and Medicaid Services. Accessed February 2022.
    https://www.cms.gov/Medicare/Health-Plans/Medigap

Jagger Esch

Jagger Esch is the Medicare expert for MedicareFAQ and the founder, president, and CEO of Elite Insurance Partners and MedicareFAQ.com. Since the inception of his first company in 2012, he has been dedicated to helping those eligible for Medicare by providing them with resources to educate themselves on all their Medicare options. He is featured in many publications as well as writes regularly for other expert columns regarding Medicare.

4 thoughts on “Medicare Supplement (Medigap) Plans

  1. we had Transamerica supplement insurance until 1/1/2021 and our agent said that medica would be a better insurance, and it is not. can he get back on the plan he had before?

    1. Hi Michael! Unfortunately, this is very common & beneficiaries end up learning the hard way. You can enroll in a Medigap plan at any time of the year. The only issue is if you have any pre-existing conditions you could be denied. Give us a call and we can help figure out how to get you back on the plan you had or equivalent.

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