What is Medicare Supplement insurance?

What is Medicare Supplement insurance?

Some people choose to purchase Medicare Supplement insurance in order to cover out-of-pocket costs not covered by Medicare Part A or Part B. Medicare Supplement plans are offered by private insurance companies and are sometimes referred to as Medigap.

Out-of-Pocket Costs Covered by Medicare Supplement Insurance

The benefits of each plan vary. However, the following costs are often covered by Medicare Supplement insurance:

  • deductibles
  • coinsurance
  • copays

Medicare Supplement insurance does not cover Medicare Part D Prescription Drug plans. Individuals pay the premium for both Medicare Supplement and Medicare Part D.

Differences Between Medicare Supplement Insurance and Medicare Advantage

Medicare Supplement insurance and Medicare Advantage are sometimes confused. Medicare Supplement covers the gap in costs not covered by Medicare Part A and Part B. Medicare Advantage is a plan that includes Part A and Part B and then extends the benefits. Therefore, Medicare Supplement would not be used with Medicare Advantage.

Standardized Medicare Supplement Plans

Benefits are standardized in most states and are itemized by the letters of the alphabet (e.g. Medicare Supplement Plan A). If you live in one of these states, you are guaranteed renewal. However, if you have a health problem, you may not be able to change plans. Certain exceptions called guaranteed-issue rights apply in some cases.

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What is Medicare Supplement Insurance?