Medicare Supplement (Medigap) Plans

If you choose to get health insurance coverage through Original Medicare instead of a Medicare Advantage plan, it is possible to have additional out-of-pocket expenses for the health services you may need. But instead of being stuck with a bill simply because your Original Medicare plan will not cover — or minimally covers — much-needed services, you can enroll in a supplemental insurance plan that helps minimize your costs. Often called Medicare Supplement or Medigap plans, this additional kind of private insurance can pick up where Original Medicare plans leave off, meaning you can still receive many of the medical and health services you need without fear of an overwhelming bill.

What is Medigap?

Medicare Supplement Insurance plans (also called Medigap) are offered by private insurance companies, much like Medicare Advantage. Their purpose is to help cover items and expenses that Original Medicare does not, primarily copayments, deductibles and coinsurance. This can be helpful when Medicare coverage will not kick in until you meet a deductible or if your coinsurance payment is much more than you can afford.

In some cases, Medigap plans can also provide coverage for services Original Medicare does not, like when traveling outside of the country. Because Medigap plans are offered by private insurance companies, each type of plan can offer different benefits to suit your individual needs.

While Medigap is similar to Medicare Advantage in that it is offered by private insurers, you should know that they are completely separate and have different purposes; Medicare Advantage plans provide health insurance benefits, while Medigap plans add another level of insurance to help cover costs. You cannot use Medigap plans without Original Medicare.

How Medigap Plans Work

Generally, Medigap coverage kicks in after your Medicare benefits have been used. At a doctor’s office, hospital or other treatment center, Medicare will first pay its portion. Then, your Medigap plan will pick up some or all remaining expenses. Whatever amount is left after Medigap pays will be your responsibility.

Because Medigap is a supplemental plan, it is important to know that you must have Original Medicare (Parts A and B). For the most part, Medigap is only for people using Original Medicare, meaning you cannot be enrolled in a plan if you use Medicare Advantage, though it is possible to sign up if you are leaving your Medicare Advantage plan and returning to Original Medicare.

Just like your Original Medicare coverage, Medigap plans come with a monthly premium that varies by what kind of plan you select. To receive benefits, you will have to pay this premium on top of your monthly Medicare Part B premium. You cannot lose Medigap coverage based on your health situation, so as long as you keep up with your monthly premium, you can continue using your benefits year after year.

What Medigap Will (And Will Not) Cover

Medigap coverage plans offer help with much of the upfront costs of healthcare such as coinsurance, copayments, deductibles and excess charges through one of 10 kinds of plans. Like the many parts of Medicare, each plan has an alphabet letter name — A, B, C, D, F, G, K, L, M and N — and offers different kinds of coverage.

In general, Medigap plans can help reduce your out-of-pocket medical expenses by:

  • Covering Medicare Part A coinsurance and hospital costs for up to a year after your Medicare benefits have been used up
  • Covering Medicare Part B coinsurance or copayments
  • Covering the cost of the first three pints of blood you may need in a medical situation
  • Covering Medicare Part A hospice care coinsurance or copayments
  • Covering Medicare Part A deductibles
  • Covering Medicare Part B deductibles
  • Covering Medicare Part B excess charges (when a doctor is legally allowed to charge you a higher rate than the Medicare-approved cost for an exam or procedure)
  • Offer some kinds of coverage when you travel outside of the United States
  • Cover 100% of costs after you reach the out-of-pocket limit for the year

Each Medigap plan offers a different level of coverage for these services, or may not help with the cost at all. Additionally, every plan has different rules for how you can use your benefits. If a Medigap plan sounds like beneficial coverage for you, consider speaking with a PolicyZip Medicare Specialist at (844) 205-7510 to determine which plan best suits your healthcare needs.

Medigap mirrors Original Medicare in that it will not cover vision and dental services, meaning you cannot use it to cover the cost of exams or services, or for any eyeglasses or dentures. In addition, Medigap will not help with the cost of hearing aids or the cost of long-term care or private-duty nursing. (In these cases, a Medicare Advantage plan may better suit your situation by providing some coverage for medical equipment and services.) At one time, Medigap plans could offer benefits for prescription drug coverage, but they are no longer allowed to, meaning that you will have to enroll in Medicare Part D prescription drug coverage for those kinds of benefits.

How Medigap Varies By Where You Live

Medigap plans are regulated by state and federals laws to protect you from insurance fraud. These regulations determine which plans can be offered in your area, along with other guidelines on how plans are used or sold. Legally, insurance companies do not have to offer Medigap plans, but if they choose to sell this kind of insurance, they must offer certain plans to ensure you have the best options to choose from. For this reason, the variety of plans offered varies among private insurance companies, and also from state to state.

In some regions, Medigap plans are offered in a different form with different names, often with fewer plans to choose from. For example, residents of Massachusetts, Wisconsin and Minnesota have different Medigap options, often called basic or core plans with other plans featuring extended services. These provide additional services such as in-patient mental health coverage and state-mandated healthcare benefits, but may put caps on how long benefits can be used for after Original Medicare stops paying. For this reason, it is important to only search for Medigap plans in the area you live to ensure you get the best plan that fits your needs and budget.