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 What is Medigap?

Medigap, also known as Medicare Supplement insurance, is private insurance designed to help cover out-of-pocket costs that Original Medicare (Parts A and B) doesn't pay, such as deductibles, copayments, and coinsurance. Medigap plans can help reduce the financial burden of these costs, making healthcare more affordable.

Some Medigap plans also cover emergency medical care when traveling outside the U.S., providing additional peace of mind for international travelers. However, Medigap only pays after Medicare has paid its share of the costs for medical services, meaning you must first pay the Medicare-approved amount.

Medigap Plans
There are 10 standardized Medigap plans available, labeled A, B, C, D, F, G, K, L, M, and N. Each plan offers a different level of coverage, but the benefits within each plan are the same, regardless of the insurance company selling it.

• Plans C, F, E, H, I, and J are no longer available to new enrollees as of January 1, 2020. However, if you were eligible for Medicare before that date, you can still purchase Plans C or F.
• Plans A, B, D, G, K, L, M, and N are still available to new enrollees.

Medicare Supplement vs. Medigap
"Medicare Supplement" is simply another name for Medigap. They refer to the same type of insurance, so there’s no difference between the two terms. Both provide additional coverage to help cover the out-of-pocket costs not paid by Original Medicare.

What Do Medigap Plans Cover?

Medigap plans are designed to help cover the out-of-pocket costs that Original Medicare doesn’t pay, such as deductibles, coinsurance, and copayments. The specific coverage depends on the Medigap plan, but all Medigap plans cover at least the following:

1. Medicare Part A Coinsurance and Hospital Fees
   Covers the coinsurance for inpatient hospital care, as well as any additional hospital costs that Medicare Part A doesn’t cover.
2. Medicare Part A Hospice Coinsurance or Copayment Costs
   Covers coinsurance or copayments for hospice care under Medicare Part A.
3. Medicare Part B Coinsurance or Copayment Costs
   Covers the coinsurance or copayment for outpatient services under Medicare Part B.
4. Blood Transfusion Costs
   Covers the cost of the first three pints of blood needed for a transfusion, which Medicare Part A and Part B don't cover.

In addition to these core benefits, some Medigap plans also cover:

• Skilled Nursing Facility (SNF) Costs
  Some plans help cover the coinsurance for skilled nursing facility care after a hospital stay.
• Medicare Part A Deductible
  Some Medigap plans cover the Part A deductible, which can be quite costly for hospital stays.
• Medicare Part B Deductible
  Some plans cover the Part B deductible, which is the amount you must pay for outpatient services before Medicare begins to pay.
• Medicare Part B Excess Charges
  Some Medigap plans cover excess charges for services provided by doctors who don’t accept Medicare’s approved amount, which can result in higher out-of-pocket costs for beneficiaries.
• Emergency Medical Costs During Foreign Travel
  Some Medigap plans provide coverage for emergency medical services if you need care while traveling outside the United States.

The exact coverage can vary based on the Medigap plan you choose, with more comprehensive plans covering additional costs such as the Part B deductible or excess charges.

What’s Not Covered by Medigap?

While Medigap provides valuable supplemental coverage to help pay for out-of-pocket costs under Original Medicare, there are several things it does not cover:

1. Prescription Drugs
   Medigap policies do not cover prescription medications. To get coverage for prescription drugs, you would need to add a Medicare Part D plan.
2. Vision, Dental, or Hearing Care
   Medigap does not cover routine vision care (like eye exams or glasses), dental care (such as cleanings or fillings), or hearing services (like hearing aids or exams). To cover these types of services, you would need additional insurance or a Medicare Advantage (Part C) plan, as some Part C plans offer extra coverage for vision, dental, and hearing care.
3. Other Health Perks
   Medigap does not cover services such as fitness memberships, transportation, or other wellness programs. These benefits may be available through certain Medicare Advantage (Part C) plans.

If you need coverage for prescription drugs, vision, dental, hearing, or additional perks, you will need to consider enrolling in a Medicare Part D plan for drugs or a Medicare Advantage (Part C) plan, which often includes these benefits as part of the package.

How Much Do Medigap Plans Cost?

The cost of Medigap plans involves several components, including premiums, deductibles, copayments, and coinsurance. Here’s a breakdown of the costs associated with both Original Medicare and Medigap:

• Original Medicare Premiums:
  • Part A: $278 to $505 per month for those who don’t qualify for premium-free Part A. Most people qualify for premium-free Part A if they or their spouse have worked and paid Medicare taxes for at least 40 quarters.
  • Part B: $174.70 per month in 2024, but the cost may vary depending on your income. High-income beneficiaries may pay more due to an Income-Related Monthly Adjustment Amount (IRMAA).
• Medigap Premium:
  In addition to the Original Medicare premiums, you will need to pay a monthly premium for your Medigap policy. The cost of Medigap premiums varies by the plan you choose, the insurer, and your location.

Before Medicare or Medigap pays for your services, you must meet your deductible amounts:

• Part A Deductible (2024): $1,632 per benefit period.
• Part B Deductible (2024): $240 per year.

Some Medigap plans will help cover these deductible costs, either partially or fully.

After meeting your deductible, Medicare pays its share of the costs, but you will still be responsible for some copayments or coinsurance. These amounts are:

• Medicare Part A:
  • $408 per day for days 61 through 90 of hospitalization.
  • $816 per day for lifetime reserve days.
  • $204 per day for skilled nursing facility care from days 21 to 100.
• Medicare Part B:
  • 20% of the Medicare-approved amount for outpatient services, which includes doctor visits, lab tests, and medical equipment.

Depending on the Medigap plan you choose, it will help cover these out-of-pocket costs, either in full or in part.

• Medigap plans can reduce your out-of-pocket costs, but not all plans cover all expenses.
• Plans K and L are unique in that they have out-of-pocket limits:
  • Plan K: Limits annual out-of-pocket costs to $6,940 in 2024.
  • Plan L: Limits annual out-of-pocket costs to $3,470 in 2024.
• Other Medigap plans do not have a cap on out-of-pocket expenses, meaning you could face significant costs if your medical needs are extensive.

• Medigap premiums are added to the cost of Original Medicare.
• There are deductible costs for Part A ($1,632) and Part B ($240) that Medigap may cover, depending on the plan.
• You will still face copayments and coinsurance for hospital stays and outpatient services unless your Medigap plan covers these.
• Only Plans K and L have out-of-pocket limits; others do not, which means you may still face substantial costs for healthcare services.

The exact cost of Medigap will depend on your specific plan, provider, and location. It's important to compare plans to find one that fits your health care needs and budget.

At Norton Insurance Agency we can help you find the best plan for you.