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A Comparison of Medicare Supplement Programs

Medicare comes in four basic parts. Parts A and B were the original Medicare plans, and cover hospital services, preventive care, home health and hospice. Part C, also called Medicare Advantage, mainly allows Medicare beneficiaries to purchase their Medicare policies from private insurance companies rather than the government; and Part D covers prescription drugs. Medicare supplements, often referred to as Medigap, help users to afford their deductibles and co-payments. Some plans offer extra benefits as well.

  1. Plan A

    • As of 2011, Plan A is the most basic and inexpensive Medigap plan. Some states have laws which require any insurance company which sells Medicare supplements to offer Plan A. All other Medicare supplement plans feature Plan A's core benefits along with their own. Plan A benefits include co-payment coverage for Part A hospital stays, an additional 365 days of hospital benefits after Medicare ends, the costs of the first three pints of blood per year and the coinsurance for Part B.

    Plan F

    • Plan F has the most benefits of all Medigap plans. It includes every kind of coverage you can buy in a Medicare supplement. All of the core Plan A benefits are included, as well as hospice co-payments, the coinsurance for skilled nursing care, coverage of both the Part A and B deductibles, and foreign travel emergency coverage. However, Plan F is generally the most expensive plan. You can buy Plan F in a more affordable, high-deductible version, which results in lower premiums. Benefits do not begin until you meet your yearly deductible amount. In 2011, this was $2,000 per year.

    Cost-Sharing Plans

    • Medigap cost-sharing plans also let you purchase a Medicare supplement for lower monthly premiums. Plans K and L have benefits for the Part B coinsurance, Part A hospital coinsurance, hospice care and the Parts A and B deductibles. Plan K covers only 50 percent of its benefits instead of 100 percent, while Plan L covers 75 percent. Instead of an annual deductible, both plans have annual out-of-pocket (OOP) limits. In 2011, the Plan K OOP limit was $4,620, while Plan L's was $2,310.

    Plan N

    • Introduced in 2010, Plan N offers benefits for hospital care, blood, the Part A deductible, hospice, skilled nursing facility coinsurance and the first three pints of blood. Plan N is the only Medigap plan which has its own co-payments, however. Its benefits for the Part B coinsurance covers 100 percent, except for a $20 co-payment for office visits. It also has a $50 co-pay for visits to the emergency room.

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