Medicare Supplements

Medicare Supplement insurance — also referred to as Med Supp or Medigap — is insurance coverage that pays for certain expenses not covered by Medicare Part A and Part B, such as copayments, coinsurance, and deductibles.

These insurance plans are sold by private insurance companies and regulated by federal and state law. In addition, all Medicare Supplement policies must be identified as Medicare Supplement insurance.

Unlike other health insurance policies with varying benefits, Medicare Supplement policies cover the same benefits, regardless of which insurance company they are purchased through. Yet, although the benefits are identical for all Medigap policies of the same type, the premiums can vary greatly from one insurance company to another and even from one geographic area to another.

You must have Medicare Part A and Part B (Original Medicare) to purchase a Medicare Supplement insurance policy. You do not need a Medicare Supplement plan if you have Medicare Part C (Medicare Advantage).

In fact, in this instance, it is illegal for anyone even to sell you a Medigap policy unless you are switching back from Medicare Advantage to Medicare Parts A and B. In addition, if you already have a Medicare Supplement insurance plan covering prescription drugs, you will not need to enroll in Medicare Part D for prescription drug coverage.

You are typically required to pay a monthly premium for Medicare Supplement insurance. The costs can increase as you get older, based on how a policy is issued. For example, if a policy uses the “issue age” method of calculating premiums, the insurance company cannot increase your premium as you age. So, you are locking in your rate based on your age when you purchase the policy. Traditionally, “issue age” policies are more expensive upfront. However, in the long run, this could work out better over time, as you won’t experience any rate increases in the future.

Like other insurance plans, Medicare Supplement insurance policies typically require underwriting. In some cases, people considered risky to the insurance company could be excluded from coverage.

However, Medicare enrollees have a 6-month Medigap open enrollment period that begins the first month that you are age 65 and you are enrolled in Medicare Part B. During this period, you have a guaranteed right to purchase any Medigap policy that is sold in your state — regardless of your health condition.

All Medicare Supplement insurance plans must offer the same basic “core” benefits. However, some plans also provide additional benefits , and some even offer coverage for services that Original Medicare doesn’t cover, such as medical care when you travel outside of the United States.

For example, Medicare Supplement Plan A covers the following basic core benefits: