Medicare Supplement Insurance
Medicare provides benefits for the most acute medical needs. However, it can still leave you with out-of-pocket expenses. Those expenses could be substantial if you experience a catastrophic illness or repeated hospitalization. Because of deductibles, coinsurance and medical expenses not covered by Medicare, most people may need supplemental health insurance to help pay for these expenses.
Understanding the Parts of Medicare
Part A
Hospital Insurance
Hopsital stays
Skilled nursing facility
Hospice care
Some home health care
Deductible must be met before Medicare pays
Once you turn 65, you’re automatically enrolled in Medicare Part A. Most people don’t have to pay a premium for Part A because they, or their spouse, paid Medicare taxes while working.
Part B
Medical Insurance
Doctor visits
Outpatient care
Medical items
Preventive services
Freedom to see any Medicare approved doctor
Medicare pays generally 80% of approved charges and the rest is out-of-pocket. Part B requires you to enroll separately (it’s not automatic like Part A) because you have to pay a monthly premium and satisfy a deductible before Medicare will pay benefits.
Part C
Medicare Advantage Plan
Combines Original Medicare Part A and Part B in one plan
May also include a portion of Part D
Often covers additional benefits
Annual out-of-pocket maximum
Usually has a network of doctors
A type of Medicare health plan offered by a private company that contracts with Medicare to provide Original Medicare Part A and Part B benefits
Part D
Prescription Drug Coverage
Helps cover prescription drug cost
Must offer at least a standard level of coverage set by Medicare
Cost/coverage may vary by plan
Each plan includes a formulary
Mail order with some plans
Part D plans are part of the government’s Medicare program, but are offered and managed through approved private insurance companies.
What is Medicare Supplement Insurance?
Medicare Supplement Insurance is an insurance policy that supplements Original Medicare (Parts A and B). It helps pay for the portion of healthcare costs that Original Medicare doesn’t cover.
Medicare Supplement (Medigap) plans can help reduce the unpredictable yearly out-of-pocket costs you may have to pay when a health issue arises.
Medicare Supplement Insurance plans give you the freedom to visit any medical provider or facility that accepts Medicare patients.
When Can I Enroll?
Open Enrollment is a six-month period when you can buy any Medicare supplement policy sold in your state, even if you have pre-existing health conditions. This period automatically starts on the first day of the month that you meet both of the following two criteria:
You're 65 (or older)
You’re enrolled in Medicare Part B (Medical Insurance)
Retiring at age 65?
Say you turn 65 on September 9. You’ve already applied for Medicare Part B, and your coverage is scheduled to start on September 1. Your open enrollment period for Medicare Supplement insurance would begin on September 1, as soon as your Medicare Part B insurance becomes effective.
Not Retiring until later?
Say you’ve already turned 65, but you’re still working and receiving health care insurance through your employer. At age 68, you decide to retire and enroll in Medicare Part B because you no longer have insurance through your employer. Your open enrollment period for Medicare Supplement insurance would begin the first day of the month your Medicare Part B insurance becomes effective.
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