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Medigap Basics

Medicare is government-sponsored health insurance for Americans age 65 or older, people under age 65 with certain disabilities and people who have End Stage Renal Disease. In general, Medicare covers expenses related to seeing doctors, hospitalization and prescriptions. Medicare doesn't cover everything, though, or only covers a portion of the expenses for some services. Some Medicare beneficiaries choose to purchase a Medigap policy, also known as a Medicare Supplement, to cover some of the costs not paid for by original Medicare.

  1. Definition of Medigap

    • When you enroll in Medicare, you are automatically provided with Part A and Part B coverage. You must also choose a prescription drug plan, commonly known as Medicare Part D. For some people, this is enough coverage. If not, you can choose Medigap coverage to "fill in the gaps" not covered by Medicare. When you receive health services, Medicare will pay its share of the costs, and then the Medigap insurance will contribute its share. You are responsible for paying any remaining co-pays and deductibles, according to your plan guidelines. You are also responsible for paying the monthly premium for your Medigap insurance.

    Types of Medigap Plans

    • As of 2010, there are 10 different Medigap insurance plans to choose from, each designated by a letter; i.e., Medicare Plan G. Each plan offers a different level of coverage. All Medigap policies are standardized, meaning that no matter which insurance company you purchase your Medigap coverage from, the benefits for each plan are going to be the same. The only difference in plans with the same letter name offered by different companies is cost.

    Enrolling in a Medigap Plan

    • In order to enroll in a Medigap plan, you must be enrolled in Medicare Part A and Part B. The best time to enroll in a Medigap plan is during your open-enrollment period, which is the six-month period beginning on the first day of the month that your are 65 years old and enrolled in Medicare Part B. If you enroll during your open-enrollment period, you can buy any Medigap policy available in your state, and the insurance company cannot deny you coverage or charge you more because of existing medical conditions. If you and your spouse are both over age 65, you must each purchase your own policy, as Medigap policies only cover one person.

    What Medigap Doesn't Cover

    • According to the Centers for Medicare and Medicaid Services (CMS), Medigap plans do not cover long-term care, private nursing care, any vision services (including eyeglasses), dental care or hearing aids. Other Medicare plans, such as Medicare Advantage plans, may cover these services. Keep in mind that if you are enrolled in a Medicare Advantage Plan, you cannot use a Medigap plan. If you want to switch to a Medigap plan, you must disenroll from your Medicare Advantage Plan and go back to original Medicare.

    Considerations

    • If you live in Massachusetts, Minnesota or Wisconsin, the Medigap plans are different than those offered in other states. Plan offerings for all states change on a regular basis; benefits are revised, plans are discontinued and new plans are added. It is a good idea to speak with a licensed insurance agent or with your state health insurance assistance department before deciding on your Medicare coverage.

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