How to Decide on Medicare Supplements

Even though it's a government insurance program, Medicare isn't exactly free. There are many costs associated with it, and all of the coinsurances and premiums can start to add up. Luckily, you can purchase a Medicare supplement, or Medigap policy, that fills in some of these gaps in coverage. There are 12 plans to choose from in each state, and each covers different benefits and has a different price. Assessing which Medigap is right for you may seem impossible at first, but with a little time and a few phone calls, you can make it manageable.

Instructions

• 1

  Make sure you understand what a Medigap is. Medigap is not your basic Medicare insurance, and you must have original Medicare (not a Medicare Advantage plan) to qualify.

  All plans have a basic coverage of your hospital coinsurance, an extra year of hospital coverage, and they take a chunk out of your out-of-pocket costs towards Part B services and pints of blood.

  Some plans offer additional coverage such as skilled nursing facility coverage, foreign travel emergencies, at home care, preventive care, and coverage during your Part A and Part B deductible periods.

• 2

  Determine what you can afford. Medigap policies are not inexpensive, and switching plans is not very simple. Plans will generally cost less if they offer less benefits or if you are in better health.

• 3

  Familiarize yourself with the plan types and what they cover. Then determine what kind of coverage is most important to you. Make a "most wanted" list. This means write down the benefits that are most important to you, of "necessary" to "would just like to have."

• 4

  Call your State Health Insurance Assistance Program (SHIP). Your SHIP will have an up-to-date list of the Medigap plans available in your state and their current costs. Many states also offer counseling services that can help you pick a plan within your budget and needs.

  Your SHIP can also give you information about when you are qualified to enter a Medigap plan or when a Medigap plan can deny you. The rules and regulations surrounding that are different in every state.

• 5

  Use the Medigap Compare tool on Medicare.gov. First you will enter your ZIP code, age, and your health status (rated from poor to excellent). Then you will be presented with a chart containing a list of plans (A-L) that checks off which plan covers what and at what cost.

  The third column is especially important. This is the estimated annual cost for someone at your age with your health condition.

• 6

  Narrow the list of plans to a list of potential plans for you to buy. Do this while looking at the Medigap Compare tool. Look at the plans that are in your price range, and find the plans that cover the most benefits on your most wanted list. Pay extra close attention to the few that you rated most important.

  From here, you should be able to narrow your list to about three or four plans you'd be happy with based on their price and benefits.

• 7

  Call each of the plans individually and ask them questions about the plan. Write down the name of the representative who helped you, and the date and time of your call in case they give you misinformation.

  Ask the plan about costs associated with the plan. Ask them what factors determines your premium, such as whether you smoke, are married. Ask about whether your premium will increase as you age, and if you have to wait for the plan to cover any pre-existing conditions. If you are in a period where a Medigap plan doesn't have to accept you, find out how they determine eligibility based on health status.

  This is also a good opportunity to rate their customer service.

• 8

  Select a plan. You may find out that you don't qualify for one of the plans on your list, or that the prices were more than you expected. Pick the one you like the best overall.