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What is a Medigap?

A Medigap Insurance policy is a type of senior health insurance sold by private insurance companies to fill the “gaps” in Original Medicare Part A and your Medicare Part B coverage.

Medigap helps pay some of the health care costs that the Original Medicare Plan doesn’t cover. If you are in the Original Medicare Plan and have a Medigap policy, then Medicare and your Medigap policy will pay both their shares of covered health care costs.

Any U.S. citizen who is 65 or older is eligible for Medicare. Generally, you are eligible for Medicare if you or your spouse worked at least 10 years in Medicare-covered employment and you are 65 years or older and a citizen or permanent resident of the United States. If you are not yet 65, you may qualify for coverage if you have a disability or you have End-Stage Renal disease (permanent kidney failure requiring dialysis or transplant).

You may be able to choose up to 12 different standardized Medigap Plans A through L. Medigap Insurance policies must follow Federal and State laws. These laws protect you. A Medigap policy must be clearly identified on the cover as “Medicare Supplement Insurance.” Each plan, A through L, has a different set of basic and extra benefits.

Most plans pay these basic benefits:

• Medicare Part A hospital deductible ($1,068 in 2009), coinsurance plus coverage for 365 additional days after Medicare benefits end.
• Medicare Part B Most people on Medicare will not see a Part B monthly premium increase as a result of a "hold harmless" provision in the current law. This allows most people on Medicare to be protected from any increase in their premiums for 2010. What this means is that for 2010, most people on Medicare will pay $96.40 a month for Part B (physician) coverage. However, some people, including those newly enrolled in 2010, will pay $110.50. Higher–income people will pay even more.coinsurance (generally 20% of Medicare approved expenses)
• First three pints of blood each year

Additional benefits, depending on the plan you choose, pay you for:

• Medicare Part B deductible
• Medicare Part B excess charges
• At-home recovery visits
• Foreign travel emergency care

How to Select the Right Plan for You

It’s important to compare each Medigap Insurance plan because costs and coverage can vary from one medicare supplemental plan to the next.

Medigap policies must follow federal and state laws. These laws protect you. The front of a Medigap policy must clearly identify it as "Medicare Supplemental Insurance". You may need both Medicare Part A and Medicare Part B to buy a Medigap Policy.

Buying a Medigap Policy

Buying a Medigap (also called “Medicare Supplemental Insurance”) policy is a very important decision. You will first need to decide if a Medigap policy is the best way for you to supplement your Original Medicare coverage.

Insurance companies set their monthly premiums. How they choose to set their prices can have an affect on how much you will pay now and in the future. You should consider all these factors, before you buy the policy. There are three common ways that a provider can choose to base their charges on:

1. Community-rated: No matter how old you are, the policy costs the same. Premiums may go up due to inflation or other factors, but not due to age.
2. Issue-age-rated: The charges are related to your age at the time of purchase - which means when you buy your policy, you will be charged the same amount as others in your community who are the same age.
3. Attained-age-rated: The charges automatically go up in price as you age.

The price of buying a Medigap policies can vary between different medicare insurance companies. Make sure you compare the same type of Medigap policy from one company to another.

For example, compare a Medigap Plan D from one medicare insurance company with a Medigap Plan D from another insurance provider.

How Do I Choose the Best Medigap Plan?

Before you purchase a medicare supplement policy, compare all your options, and premium costs.

The following is a list of common questions you should answer before you secure your plan:

• How much can you afford to spend on monthly premiums for your Medigap coverage?
• How does the plan's premium compare to other exact plans for the same benefits?
• What coverage and benefits do you really need?
• How hard is it to file my medicare claims? Can your doctor file the necessary paperwork for you?
• Is there any type of waiting period to cover my pre-existing conditions? If so, how long ? And do you have any previous coverage that applies toward reducing the waiting period?

Medigap Policy Comparison