Understanding Medicare Supplements: The Basics of Medigap
Medicare covers many health essentials for citizens sixty-five and older but it does not cover everything. Particularly for those with more complex medical histories (or futures), Original Medicare (Parts A and B) is often not enough as they move into their golden years of retirement. This is where understanding Medicare Supplements, or Medigap insurance policies come into play.
What is it?
Medigap is essentially extra insurance. Beneficiaries can buy extra insurance policies from private carriers to help pay their share of the out-of-pocket expenses that come with Original Medicare. Original Medicare is funded by the federal government. The federal government also contracts with private carriers to ensure that their Medigap policies are safe, uniform, and sufficient. Beneficiaries must have Original Medicare in order to buy a Medigap policy. This means they must sign up for Medicare Part A (hospital insurance) and Medicare Part B (medical insurance) to be eligible to purchase Medigap.
As previously mentioned, the insurance carriers that provide Medigap policies are contracted with the United States government. This means that the carriers must meet certain guidelines in order to keep their contract each year and continue to sell these policies. All Medigap policies are standardized, meaning that they all cover the same basic health benefits regardless of which company they were purchased from or which state the beneficiary lives in. There are ten different types of Medigap policy, and they are distinguished by letters (A, B, C, etc.). Price is the only difference between carriers’ plans of the same letter. This means that plans with the same letter offer the same coverage regardless of carrier. It is important to note, however, that in Massachusetts, Minnesota, and Wisconsin, the plans are standardized in a different way. Despite this, every Medigap policy must follow state and federal laws to protect their beneficiaries.
What does it cover?
The benefits of each Medigap plan differ (again, usually by letter, or tier), but they are all designed to do one thing: help cover the beneficiary’s share of costs from Medicare Parts A and B. This means Medigap policies can help cover co-payments, coinsurance, and deductibles. Some Medigap policies can cover services that Original Medicare doesn’t cover, like emergency medical care outside of the United States.
What’s not covered?
Medigap can’t cover everything that Medicare Parts A and B doesn’t. Some of the services that are not covered under Medigap policies are long-term care, vision or dental care, hearing aids, eyeglasses, and private nursing. Medigap plans that were sold after 2005 do not include prescription drug coverage, and beneficiaries can opt in to Medicare Part D for that kind of coverage.
Understanding Medicare Supplements – Agent Resources
Every agent gets $500 to cover monthly lead costs. – No gimmicks! No production requirements to start.