Pros and Cons of Medicare Supplement Insurance

Medicare Part A and Part B help senior citizens meet their health insurance needs, but they do not pay for all medical expenses. A Medicare Supplement policy can pay some of the costs not covered by traditional Medicare.

Function

• Medicare Supplement policies are designed to fill the gaps in coverage that are part of Medicare Part A, which provides hospitalization coverage, and Part B, which covers doctor visits. Gaps include deductibles and copayments that would otherwise come out of the senior's pocket.

Benefits

• In addition to filling the gaps in coverage, a Medicare Supplement also provides standardized coverage. The federal government mandates the coverages that must be included in the 12 different Medicare Supplement plans, so the insured person doesn't have to worry about being misled by a salesperson.

Drawbacks

• On the other hand, because the coverages are government-mandated, the insured doesn't have a lot of flexibility when choosing a plan. Also, a Medicare Supplement plan results in an additional monthly expense that increases each year as the insured person ages, which can be a financial burden for those on fixed incomes.