What Is Medicare
What is Medicare? What is Medigap? These are two of the most commons questions we are asked on a daily basis, so we decided to dedicate an entire page to the what is Medicare, what is Medigap trivia question. While both Medicare and Medigap are very in-depth, this page should give you a broad understanding of how to discern one from the other and how to see if either of them apply to you. As always, you can call us with questions at 866-260-9829 if need be. We’re here to help!
What is Medicare Part A and Part B? Medicare Part A and B are provided by the government. Your Part A is paid for through 40 quarters of Medicare taxes while working and Part B is paid monthly once you enroll in Medicare. For most people, as of 2016, the Part B premium is $121.80, however, it is based on your income. Medicare Part A and B by themselves leave you with many gaps in coverage, so using them alone to insure isn’t a great idea.
So, what is Medigap? A Medigap plan fills the gaps in Part A and B. For most people, the best Medigap plan (Plan F) runs between $100 to $150 at age 65, depending on where in the country you live. Plan F fills all of the gaps in coverage (Prescriptions aside, that’s Part D, below), however, around here, we are big fans of Plan G, the second best plan. More on that later.
Dual eligibility – Some people who are eligible for both Medicare and Medicaid are called “dual eligibles.” If you have Medicare and full Medicaid coverage, most of your health care costs are likely covered. You can get your Medicare coverage through Original Medicare or a Medicare Advantage Plan (like an HMO or PPO). If you have Medicare and full Medicaid, Medicare covers your Part D prescription drugs. Medicaid may still cover some drugs and other care that Medicare doesn’t cover.
What Is Medigap
A Medigap policy is private health insurance that helps supplement Original Medicare. This means it helps pay some of the health care costs that Original Medicare doesn’t cover (like copayments, coinsurance, and deductibles). These are “gaps” in Medicare coverage. If you have Original Medicare and a Medigap policy, Medicare will pay its share of the Medicare-approved amounts for covered health care costs. Then your Medigap policy pays its share. A Medigap policy is different from a Medicare Advantage Plan (like an HMO or PPO) because those plans are ways to get Medicare benefits, while a Medigap policy only supplements the costs of your Original Medicare benefits. Note: Medicare doesn’t pay any of your costs for a Medigap policy.
All Medigap policies must follow federal and state laws designed to protect you, and policies must be clearly identified as “Medicare Supplement Insurance.” Medigap insurance companies in most states can only sell you a “standardized” Medigap policy identified by letters A through N. Each standardized Medigap policy must offer the same basic benefits, no matter which insurance company sells it. Cost is usually the only difference between Medigap policies with the same letter sold by different insurance companies.
In Massachusetts, Minnesota, and Wisconsin, Medigap policies are standardized in a different way. In some states, you may be able to buy another type of Medigap policy called Medicare SELECT. Medicare SELECT plans are standardized plans that may require you to see certain providers and may cost less than other plans.
This chart shows basic information about the different benefits that Medigap policies cover. If a percentage appears, the Medigap plan covers that percentage of the benefit, and you must pay the rest.
*Plans K and L pay 100% of hospitalization and preventive care Basic Benefits. All other Basic Benefits are paid at 50% for Plan K, and 75% for Plan L. Once you reach the annual limit, the plan pays 100% of the Medicare copayments, coinsurance, and deductibles for the rest of the calendar year. The annual out-of-pocket limit does NOT include costs from your provider that exceed Medicare-approved amounts (excess charges).
*Plan F is also offered as a high-deductible plan. With a high-deductible Plan F, you must pay for Medicare-covered expenses such as copays and deductibles up to $2,180 in 2016 before the policy pays anything.
*Plan N covers Basic Benefits after a $20 copay for office visits and a $50 copay for emergency room visits.
- Insurance companies selling Medigap policies are required to make Plan A available. If they offer any other Medigap policy, they must also offer either Medigap Plan C or Plan F.
- Not all types of Medigap policies may be available in your state.
- Plans D and G effective on or after June 1, 2010, have different benefits than plans D or G bought before June 1, 2010.
- Plans E, H, I, and J are no longer sold, but, if you already have one, you can generally keep it.