Medicare Supplement Insurance (Medigap) is what people buy to fill in the “gaps” in their Original Medicare coverage (Medicare Hospital Insurance (Part A) and Medicare Medical Insurance (Part B)). Supplements help cover the deductibles, co-payments and expenses not paid by Part A or Part B. For example, the first day in the hospital requires a payment of $1,132 by Medicare. A Medigap plan would pay that bill.
Beneficiaries who purchase a Medigap plan pay an additional monthly premium on top of their Part B premium to a private insurance company approved by Medicare. Medicare does not pay any costs for a Medigap policy.
All Medigap policies have standard features, no matter which company is marketing the plan. There are 10 plans and they are identified by letters: A, B, C, D, F, G, K, L, M and N. Each plan has somewhat different benefits. The most popular is Plan F, which includes full co-payment for Part B. This will cover such things as the costly cancer drugs administered in a doctor’s office or a hospital outpatient facility.
Here is Medicare’s description for consumers: “Every Medigap policy must follow federal and state laws designed to protect you, and the policy 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.”
Medicare Supplement Insurance (Medigap) is supplemental insurance that seniors can purchase from private companies to add to traditional Medicare coverage (Medicare Hospital Insurance (Part A) and Medicare Medical Insurance (Part B). The plans will pay for the co-payments and deductibles under traditional Medicare.
When Were Federal Standards Set for Medicare Supplement Insurance (Medigap) Policies Sold to Seniors?
Does Medicare Cover All of Beneficiaries' Medical Expenses After Age 65?
What Cost-Sharing Obligations Do Beneficiaries Have Under Medicare Hospital Insurance (Part A) and Medicare Medical Insurance (Part B)?