Medigap insurance: Calling it what it is
When you first become eligible for Medicare you should be excited and relieved that you can have some credible health insurance that won’t break the bank. But Medicare isn’t free and a share of the cost for Medicare-covered services is your responsibility.
To help control some of those costs, insurance companies offer supplemental policies referred to as Medigap insurance. Medigap is so named because it’s a way to fill some of the gaps in Medicare. Some initial confusion is the result of not knowing what Medicare gaps are. The gaps filled are not gaps in covered services, but rather the expenses that are your responsibility.
A Medigap policy supplements Medicare by paying a share of your expenses. And that is why Medigap is also known as a Medicare supplement or Medicare supplemental coverage.
It’s also important to note that a Medicare Advantage Plan is not a Medicare supplement. Medicare supplements and Medicare Advantage Plans are two distinct types of plans.
Medicare supplement insurance facts
Understanding how Medigap works is the first step in determining whether it is the right Medicare plan choice for you. Becoming familiar with the following facts can help you shop for and compare plans.
- There are 10 standardized plans from which to choose
- The best time to buy is during your Medigap Open Enrollment Period
- Medical underwriting is not used if you have Guaranteed Issue Rights
- Medical underwriting applies at other times
- You are not subject to annual enrollment periods
- Part D is not included in Medigap policies
- Premiums can vary widely between companies for the same plan
- You cannot be canceled except for nonpayment of premiums
Standardization allows you to choose a plan that fits your budget. The amount of expenses covered by a plan determines the premium. If you are outside of open enrollment or do not have Guaranteed Issue Rights there are many other factors that can affect your premium as well. These may include: Where you live, age, gender, tobacco use and your overall health.
The best time to buy a Medicare supplement is during your Open Enrollment Period which begins when you are first eligible for Medicare. This enrollment period lasts for 6 months. During this time an insurance company must sell you any policy that it sells, not make you wait for coverage and cannot charge you more due to pre-existing health conditions.
When you begin the process of shopping for a Medicare plan, remember that the terms Medigap insurance and Medicare supplement are interchangeable. Once you get past any confusion about the definitions you can get busy comparing plans and finding your best plan option.