What is Medigap?

Medigap is a health insurance policy that you can purchase from private insurance companies. The policy is supplemental coverage for health care expenses that are not covered under Medicare, and is also known as a “Medicare Supplement” policy. These may include deductibles and co-payments. Some policies also include coverage for medical care when you travel to foreign destinations.

Generally, Medicare Supplements do not cover hearing aids, dental procedures, vision care, eyeglass prescriptions, long-term care, private duty nursing and stays in nursing facilities. Additionally, Most Medigap insurance plans do not pay for prescription medication.

There are important factors to consider before purchasing a Medigap insurance policy. To qualify for this insurance, you must have Medicare Part A and Part B. Moreover, you can apply if you currently have a Medicare Advantage Plan. Just make sure you are not penalized for leaving the Medicare plan before the policy starts.

Equally important is having this insurance for you and your spouse. Both of you will have to purchase separate policies since only one person can be covered per supplement policy. With policies purchased after January 1, 2006, prescription drugs are not part of the coverage. You must join the Medicare Prescription Part D drug plan for prescription coverage if you want this coverage.

Monthly premiums are required for Medigap Plans, which is paid in addition to your Medicare Part B premium. The cost will vary based on your age, where you live, the insurance company and the type of plan you purchase. You are guaranteed a renewal on a standardized Medicare Supplement plan even if you have health issues when your premiums are paid on time.

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Why You Might Need a Medigap Insurance Policy

Medicare offers many benefits to individuals age 65 and older. Rising costs in medical care would make it impossible for most older Americans to afford the care they need. However, there are still areas where individuals are not covered adequately. The primary reason why you may need a Medigap insurance policy is to have coverage for health care services that are not covered by Medicare.

You may change a Medicare supplement plan at any time throughout the year as no enrollment period applies to this type of policy. Keep in mind however, that if you do decide to change you must go through the medical underwriting process if you are out of an open enrollment or guaranteed issue period.

How to Shop for the Best Medigap Policy

The cost for a supplement plan varies widely even with insurance companies that provide identical coverage. While checking rates, make sure you are comparing the same plans from different companies. Keep in mind that it is illegal for an insurance agent to sell this policy to you when you already have a Medicare Advantage plan. You cannot have both policies active at one time.

Typically, each insurance provider will set its premiums. Working with us you can compare multiple companies at one time, and it’s best to ask how each company is priced because this will affect how much you pay for current and future coverage. In general, Medigap policies will rate a policy in one of three ways.

The first is a community-rated policy. Everyone covered by this policy will pay the same monthly premium despite their age differences. Another is called the issue-age-rated policy. Your premium is lower if you purchase the policy at a younger age such as 65. The premium never increases as you age. However, inflation may result in a premium increase.

The third type is an attained-age-rated policy. Your premium with this type of policy is based on your current age but will increase as you get older.

The time to purchase any of the Medicare Supplement plans is throughout open enrollment, which lasts for six months from the first day of the month of your 65th birthday. This applies as long as you are signed up for Medicare Part B. Your premium during this period is the same that a person in good health will pay. After six months, coverage is not guaranteed. If you do receive coverage, your rates could be higher than what you would have paid during open enrollment.

In some situations, you might have to wait six months if you have a preexisting condition. An insurer may refuse to cover out-of-pocket expenses during this six month period. After this time has passed, a supplement plan will cover preexisting conditions. The only exception is if you had continuous creditable coverage and you purchased your Medigap insurance during the open enrollment period.

You may find less expensive plans as you shop around for Medicare supplement coverage. However, these plans usually have higher out-of-pocket expenses and fewer benefits. The most expensive plans will have extra benefits such as at-home recovery care, routine checkups and Medicare deductibles.

To determine which companies have the best Medicare Supplement rates, simply enter your zip code at the top of this page and click on the various companies to get quotes.