Supplemental Insurance for Senior Citizens

Senior citizens who sign up for Medicare health insurance coverage are often surprised to find that Medicare doesn't pay for all health care expenses. Some doctor's visits, prescription drugs and diagnostic tests are often not covered by Medicare, and additional costs for long-term care in a nursing home or other facility can also create a financial burden. Supplemental insurance policies can provide coverage for areas where Medicare is lacking.

Who Needs Supplemental Insurance?

• Almost every senior who does not have health insurance from an employer or through a spouse's group plan can use supplemental insurance. Supplemental health insurance provides coverage for services and prescriptions that Medicare does not pay for, and some plans offer complete coverage when Medicare benefits are exhausted, such as in long hospital stays. Because the need for long-term care in a nursing home setting is always a possibility but one that is not covered by Medicare or traditional health insurance, a long-term care policy is also advisable.

Supplemental Health Insurance

• For most retirees who do not have pension insurance or who are receiving Medicare benefits, a supplemental health insurance policy is a must to cover the out-of-pocket costs associated with Medicare. Also known as Medigap policies, these supplemental health insurance policies are sold through health insurance companies, but the policies offered often vary from state to state. Both Insure.com and Bankrate advise enrolling in a Medigap policy during your state's "open enrollment" period, which lasts for six months beginning on the first day of the month in which you are 65 or older and enrolled in Medicare Part B.

What Supplemental Plans Cover

• Like any health insurance policy, supplemental health insurance policies offer varying coverages depending upon what you are willing to pay. There are plans that cover hospice and skilled nursing care, plans to cover emergencies during foreign travel and high deductible plans for those who'd like a lower premium. While plans will vary from state to state, all states are required to offer Medigap policies.

  Most Medigap policies will not cover long-term care and do not offer dental or vision coverage.

Long-Term Care Insurance

• In addition to supplemental health insurance, most seniors should have long-term care insurance to cover a stay in a rehabilitation facility or nursing home. It is advisable to purchase long-term care insurance as soon as possible; the older you are at the time of purchase, the higher your premium is likely to be and the less coverage you will qualify for. Long-term care insurance is sold through independent insurance agents.