Medicare supplement plans, commonly referred to as Medigap policies, are an extra insurance plan taken in order to bridge “gaps” left behind by Original Medicare covers. Medigap plans are offered by private insurance companies, unlike Original Medicare, which is managed by the federal government through the Centers for Medicare & Medicaid Services (CMS).
Original Medicare only covers inpatient care (Part A) and services or supplies medically required in treating the insured, you, Part B. Like common insurance plans, premiums are paid to cater for the services received. However, Medicare only pays up to an agreed amount the excess from which the Medicare holder pays the rest of the accrued amount.
Medigap policies act as supplements to Original Medicare benefits. Medigap policies are meant to cater for expenses (“gaps”) arising from services that Original Medicare does not cover. Such health care costs not covered by Original Medicare include coinsurance, deductibles, and copayments.
Medigap policy plans can only be bought on the condition that you already have an Original Medicare policy. In case of health costs to be catered for, your Original Medicare policy will settle its share of the agreed upon amount for the health care costs it covers. Any other charges arising from your health care are settled by your Medigap policy.
Standardization of Medigap plans
Medigap policies offer different health cost coverage and are denoted by the letters A, B, C, D, F, G, K, L, M, and N. Plans E, H, I, and J were phased out.
Plans A & B are the basic benefit Medigap policies.
Plans C, D, F & G are more comprehensive with little cost sharing.
Plans K, L, M & N have more cost sharing (may include the high-deductible Plan F)
Standardization is meant to protect you by following the federal and state laws in which they are offered. Private Insurance companies must clearly identify Medigap policies as “Medicare Supplement Insurance”. A Cigna Medicare Supplement helps pay for coinsurance and deductibles.
Insurance companies decide what policies to offer but they must offer at least Plan A. Other plans in addition to Plan A, the insurance company should offer either Plan C or Plan F alongside any other standardized Medigap policy it seeks to offer.
Massachusetts, Minnesota, or Wisconsin are differently standardized.
Medigap Policy costs
Private insurance companies are required to offer the standardized Medigap policies offering the required benefits for each lettered plan but remain unregulated for the premiums for which they charge on the policies.
Medigap Enrollment and Eligibility
Medigap policy eligibility required an enrollment in both Part A and Part B Original Medicare policies. Enrollment for Medigap policies is usually on the 1st of the month that you turn 65 years or when older and enrolled in Part B and usually lasts 6 months from which you will be required to join a Medigap policy of your choice. If you are still not satisfied with the information provided, you should meet with your doctor or the administrator of your insurance.