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Medicare Supplements 101

If you're 65 and above, you've probably applied for Original Medicare (Part A and Part B).

While Original Medicare pays for healthcare and supplies, it does not cover all. That's where Medicare supplements come in.

What is Medicare Supplement?

Medicare supplement is also referred to as Medigap because it helps fill the gaps in Original Medicare by paying for the cost of copayments, coinsurance, and deductibles. Medicare supplements plans are regulated by the state insurance departments and sold by private health insurance companies.

How does Medicare supplement work?

Medicare supplement is available through several plans such as A, B, C, D, F, G, K, L, M, N. However, some of these plans (C, F, E, H, I, and J) are not available for those who apply for Medicare after 2020.

Medicare supplement plans help pay for what's left of out-of-payment costs such as copayments, deductibles, and coinsurance after Medicare and you have paid your share.

Medicare supplement plans are also standardized, which means plans from different companies provide the same benefits.

Medicare supplement plans are designed for individuals and cannot cover couples. However, a husband and wife can buy separate plans.

What Medicare supplement plans cover

Medicare supplement covers extended hospital costs, coinsurance, and hospice care payments for Part A. Medicare supplement plans also cover some Part B costs such as coinsurance and deductibles. They also help pay the cost of the first three pints of blood if you need a transfusion. Plans also cover emergency healthcare services outside the US for the first 60 days.

However, if you just became eligible for Medicare (in 2022), you won't be able to purchase a Medicare supplement plan (Plan C and F) that covers Part B.

If you were eligible before January 1, 2020, you'd still be able to buy Plan C and F. But if you've already purchased a Plan C and F, you can keep them.

Medicare supplement plans do not cover non-medically necessary services and prescription services.

Enrolling in a Medicare supplement plans

Before signing up for Medicare supplement, you must first sign up for Original Medicare (Part A and Part B). In the first six months of your enrollment into Part B, you'll be automatically into Medicare supplement if you apply. This period is called a guaranteed issue right period.

You can enroll during the Medicare Open Enrollment Period, which is only available once after you enroll in Medicare Part B. If the enrollment period passes and you miss the opportunity to enroll, you'll have to do an underwriting if you have a change of mind. The underwriting will ascertain whether the insurance company can accept you or not.

How much does Medicare supplement costs?

Although Medicare supplement plans are standardized, prices vary from one insurance company to another. Costs also depend on the state that you live in. So if you live in Richmond, Virginia, you may pay less or higher than someone living in Florida. How much you'll pay also depends on the plans you choose. Generally, a higher coverage means higher costs. Factors such as age, sex, and health history also determine the Medicare supplement cost.

Why Medicare supplement?

  • Medicare supplement offers nationwide coverage. You can buy a plan in one state and use it in another state.

  • The costs are predictable.

  • You can choose from various plans to meet your health needs.

  • Insurance companies can't turn down your application if you sign up during the enrollment period after you turn 65.

How to buy Medicare supplement plans

There are various ways to buy Medicare supplement plans, including finding a policy on the Medicare website. You can also call 800-MEDICARE (800-633-4227) or contact insurance providers yourself.

However, the best way to buy a plan is through an independent insurance agent, who'll help compare the coverages and prices from different providers and guide you in choosing the best value in price and coverage.

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