The Disadvantages of Medicare Supplement Insurance

Medicare is a federal benefit program that pays for health care services for individuals age 65 and older. Private health insurance is used to supplement Medicare and pay for services not covered under the Medicare program. Medicare beneficiaries with supplemental insurance must pay an additional monthly premium and also may pay a co-payment for each visit with a treating physician. While Medicare supplemental insurance is beneficial, it has a number of disadvantages such as out-of-pocket expenses and a limited network of health care providers.

Insurer May Leave

• In some instances, an insurer may leave the Medicare program when certain geographic regions are not profitable. The policy is not guaranteed renewable, and the insured may have to to find other coverage.

Policy Limitations

• Many supplemental Medicare insurance programs are inflexible and offer limited treatment options. A Medicare recipient may be limited to using a certain network of physicians and other health care providers, and may also be required to remain with the chosen provider. In many cases, a beneficiary’s general physician must approve medical treatment by a specialist. Beneficiaries who travel may face difficulties obtaining care because many Medicare supplemental programs limit care to certain geographic areas, except in cases of medical emergency.

Out-of-Pocket Expenses

• With Medicare supplement insurance, beneficiaries may pay out-of-pocket expenses for visits with a specialist. If specialist treatment is deemed medically unnecessary by the insurer or an insured’s general physician, a beneficiary may face significant out-of-pocket expenses for such care.