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What's Medigap and Medicare supplement insurance coverage?

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If you're shopping for a Medicare plan for the first time or thinking of changing your current plan, this explains one of your options: Medicare supplement insurance, also called Medigap.

Medigap and Medicare supplement insurance plans have been around almost as long as Medicare. They're sold by health insurance companies like us. They help people pay for their share of the costs for health care services covered by Medicare. Those costs include:

  • A set amount called a deductible you pay before Medicare starts paying. Medicare has two deductibles: one for Part A, which covers hospital services, and one for Part B, which covers medical services.
  • Hospital expenses applied after you meet your Part A deductible. Medicare pays your expenses for the first 60 days you're in the hospital. Then you start paying $322 per day (in 2016). That amount increases the longer you're in the hospital.
  • A portion of the cost of most services after you meet your Part B deductible. Medicare pays 80 percent of your costs. You pay the other 20 percent.

So your costs can really add up. That's where a Medicare supplement insurance plan can help. It'll pay your 20 percent coinsurance. It'll pay for your hospital expenses. Some supplement plans pay one or both of your deductibles. Some will pay for emergency care you need outside of the U.S.

How it works

Generally, before you can buy a supplement plan, you have to be at least 65 and enrolled in Original Medicare Part A and Part B.

You apply for a Medigap or Medicare supplement plan offered by a health insurance company. These plans only cover one person, so if you and your spouse both want supplement coverage, you'll each need a plan. It doesn't have to be the same plan.

Budget basics

You'll have up to three monthly payments:

  • Your Medicare Part B premium. Most people have this taken out of their Social Security check.
  • Your Medigap or Medicare supplement plan premium you pay to your health insurance company.
  • Supplement plans sold after 2006 don't include Part D prescription drug coverage. If you don't have drug coverage from another source that meets certain standards, you'll need a Part D plan. You'll likely have a premium for that too.

When you need care

With most Medigap or Medicare supplement plans, you can go to any doctor or hospital that accepts Medicare. You'll give them your Medicare card and your supplement plan ID card.

Original Medicare will pay its share. Your supplement plan will pay your share of the costs, depending on what the plan covers. It may also coordinate payment with Medicare and your health care providers. That means you won't have to bother with claim filing or paperwork.

Your supplement plan choices

The government decides which supplement plans health insurance companies can offer. There are 10 different plans: A, B, C, D, F, G, K, L, M and N. Plan F also offers a high-deductible option. Each one pays the same amount for the same services, no matter which health insurance company is selling it. There are two main differences:

  • Which plans a company offers. But all companies that sell Medigap or Medicare supplement plans have to offer Plan A.
  • What the company charges for their supplement plans.

You can learn more about Medigap and Medicare supplement plans and how they compare to each other using page 20 of this brochure (PDF).

We offer four MyBlue Medigap plans: Plan A, Plan F, Plan HD-F and Plan N. Some cover more services than others, so you can choose the right one for your needs. 

What's not covered

At one time, some Medigap plans included prescription drug coverage. That ended in 2006. All plans sold after that year don't cover prescription drugs. A Medigap plan with drug coverage you have from before 2006 might not meet current health care standards. You can enroll in a separate Part D plan, like a Prescription Blue℠ PDP plan

Original Medicare covers some dental, vision and hearing services. Your MyBlue Medigap plan will pay your share of the cost in those cases. Medicare doesn't cover routine dental or vision care or hearing aids. Your MyBlue Medigap plan doesn't cover those either.