Medigap, also known as Medicare Supplement, is an additional insurance policy you can buy when you’re enrolled in Original Medicare (Parts A and B). Medigap helps pay for the coverage gaps in Original Medicare, and the cost of your Medigap plan will depend on multiple factors.
Medigap Plan Pricing
There are two key factors to keep in mind when evaluating your Medigap costs: Your chosen plan’s monthly premium and its deductible. The monthly premium is the amount you'll pay each month for coverage. A deductible is the amount you have to pay out-of-pocket before your plan begins to pay for services.
The U.S. government standardizes Medigap plans into 10 lettered plans, A-N. According to the Centers for Medicare & Medicaid Services, private insurance companies then follow federal and state laws to develop Medigap policies, which must be clearly identified as “Medicare Supplement Insurance”. Each policy must offer the same standardized coverage according to its lettered classification—no matter which private company is selling it.
When you choose your Medigap policy, your options will be limited to the private companies offering the particular lettered plans available in your area. The Centers for Medicare & Medicaid Services notes that the availability of specific lettered plans will vary by state.
According to the official U.S. government website for Medicare, there may be multiple private insurance companies offering each of the particular lettered plans available in your region. Because each company sets its own monthly premium rates, the costs of specific lettered plans will vary.
You can use the official U.S. government website for Medicare to see the range of Medigap policy premium rates according to your zip code. The official website will also help you evaluate the individual plans available to you for their coverage, deductible, and pricing specifics. You’ll need to enter your zip code, age, and sex. You’ll also answer whether you use tobacco or not.
What Medigap Covers
Some Medigap policies also cover up to 80% of medically-necessary emergency health care costs incurred while you are traveling outside of the U.S., in accordance with your plan’s limits.
More specifically, according to the official U.S. government website for Medicare, Medigap policies can cover the following:
- Part A coinsurance and hospital costs, up to an additional 365 days after Medicare benefits have been used up
- Part B coinsurance or copayment
- The first 3 pints of blood transfusion
- Part A hospice care coinsurance or copayment
- Skilled nursing facility coinsurance
- Parts A and B deductibles
- Part B excess charge
Not all lettered plans will cover all of the above items. Consult the official U.S. government website for Medicare to compare the specific policies available in your region.
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