Medicare Supplement Insurance or Medigap is a plan that you can buy as extra health insurance from a private company. The primary purpose of Medigap is to cover the costs of your healthcare that the Original Medicare does not cover for you. These costs include healthcare while traveling outside the country, deductibles, and co-payments.

If you only have the original Medicare insurance policy, you are not maximizing your insurance benefits. It’s better to start checking on the basics of Medicare Supplement Insurance plans and understand why you should get one for yourself.

Before this post delves into the essential things you should know about Medigap, you have to first understand why Medicare might not be enough for your needs. Below is a simple explanation of why it’s not ideal to have the original Medicare as your only insurance.

Original Medicare Won’t Cover All Your Healthcare Costs

Before anything else, you need to understand the problem before you can find a solution. Money is disappearing from your paycheck every month because you are paying 1.45 percent of your earnings to Medicare to cover for healthcare costs later in life. Your employer pays the other 1.45 percent to complement your payment. If you’re self-employed, you have to pay for both amounts.

Here’s a list of problems you may encounter later on despite faithfully paying for Medicare:

  • The total of the health insurance you are paying for your whole working life might not be sufficient, considering the rising healthcare costs today.
  • With the original Medicare, you will still have to cover 20 percent of the costs of surgeries, tests, procedures, and other care that you undergo in a year. If you do the math, this can translate to a huge bill that most retirees will have a hard time to pay. The 80 percent covered by Original Medicare takes off the burden from your pocket somehow, but the 20 percent still hurts if this amount accumulates annually.

At this point, maybe you’re realizing that there’s a need for you to fill the gaps. The Medicare Supplement Insurance was created for this specific purpose.

Check out the essential things you need to know about Medigap below.

You Also Have To Pay A Monthly Premium For A Medigap Policy

Just like any other health insurance policies out there, you’ve got to pay premiums if you want to reap the benefits of a Medicare Supplement Insurance Plan. Remember that even if you already have Medicare insurance, it doesn’t cover the costs of getting a Medigap policy.

Below are more details about the Medigap’s monthly premium.

  • The monthly premium amount varies – There are several factors that may affect the premium amount that you have to pay each month, including the type of plan you choose, your age, your medical underwriting, and the extent of your chosen plan.
  • Payments for Medicare and Medigap cannot be made together – Medicare’s premium is paid to the government, while you have to pay a private insurer for your Medigap’s policy. The payment options for each insurance policy also vary. 

Specific People Are Eligible For A Medigap Policy 

Who are eligible for the Medigap policy? Check the details below:

  • Individuals with Medicare Parts A and B – For you to be eligible to buy a Medigap policy, you should already have Medicare parts A and B. The Medicare part A and B will cover the costs of hospital and doctor services, while the Medicare Supplement Insurance Plan fills in the gaps.
  • US Citizens – To avail of a Medicare Supplement Insurance, you should be a US Citizen or someone who has been a permanent legal resident of the country for at least five years. 

Medigap Is Different From The Medicare Advantage Plan

 Keep in mind that Medicare advantage plans are different from the Medigap, plus you cannot have both at the same time.

How do advantage plans differ from the Medigap? Well, advantage plans are simply ways for you to get benefits from Medicare. Meanwhile, the Medigap supplements those benefits. To purchase a Medigap policy, you need to leave your Medicare advantage plan first or wait for it to expire.

The Medicare Supplement Insurance Plan is Guaranteed Renewable

So long as you pay the premium, your insurance company cannot cancel the Medigap plan that you have. The Medicare Supplement Insurance Plan does not have lifetime maximums. In other words, no matter how many times you claim an amount from your policy because of heart problems and other health-related reasons that require medication, the plan will stay with you.

What does this mean to you as a retiree? Find the answers below:

  • Protect your retirement savings – With a Medigap policy, you can protect your retirement savings and make sure that you’re covered if a significant health crisis hits you. The Medigap is especially helpful in paying for what Medicare does not fully include in its coverage.
  • Customize your coverage – The option to customize your coverage based on your needs is exactly what you can get from Medigap. One significant customization option you can enjoy is adding coverage for prescription drugs since they are not part of the initial Medicare Supplement Insurance plan.

Conclusion

Although a Medicare Supplement Insurance Plan does not cover everything, it is one of the things that you, as an aging adult or retiree, should invest in to safeguard your financial security and health. When choosing a Medigap plan, always assess your needs and come up with a smart decision.

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