Supplement Insurance

Medicare Supplement insurance plans, also known as Medigap, help pay for medical costs not covered by original Medicare. There is a gap between what Medicare covers and what you as the beneficiary is responsible for when getting medical services. You will need more medical care as you age and could end up with high unexpected costs if you do not have supplemental insurance to cover the 20% percent portion of your Medicare bills. Medicare supplement insurance generally helps pay for the following health care costs:

  • Copayments
  • Coinsurance
  • Deductibles

After you sign up for original Medicare (Parts A & B) and then buy a Medicare Supplement plan, original Medicare will pay its share of the Medicare-Approved Amount for covered health care costs. Then, your Supplement insurance will pay its share.

8 Things To Know About Medicare Supplement

  1. Medicare Supplement plans are offered by private insurance companies.
  2. You must have Medicare Parts A & B to apply for a Medicare Supplement plan.
  3. Supplement plans do not replace original Medicare benefits.
  4. There is a monthly premium for Supplement plans.
  5. Each Supplement plan covers only one person, no exceptions.
  6. Supplement plans are guaranteed renewable as long as you pay the premium.
  7. Supplement plans sold after January 1, 2006 are not allowed to cover medications.
  8. Supplement and Part D plans purchased from the same company usually require separate premium payments.

When is Medigap Open Enrollment?

You can buy a Medigap plan without medical underwriting the first day of the month that you turn 65 and enroll in Medicare Part B, with some exceptions. If you have group health insurance through an employer or union, your Medigap open enrollment period will start when you sign up for Part B.

Under federal law, you have a six-month open enrollment period that begins the month you are 65 or older and enrolled in Medicare Part B. During your open enrollment period, Medigap companies must sell you a policy at the best available rate regardless of your health status, and they cannot deny you coverage. The best available rate may depend on a number of factors, including your age, gender, whether you smoke, your marital status, and where you live.

You may run into problems if you try to buy a Medigap policy outside a protected enrollment period. For instance, companies can refuse to sell you one or impose certain medical requirements. If a company does agree to sell you a policy, you may need to pay a higher monthly premium and be subject to a six-month waiting period before the Medigap will cover pre-existing conditions. Be sure to contact Medigap insurers in your state to learn if they will sell you a Medigap policy outside protected enrollment periods.

If you have End Stage Renal Disease (ESRD), you may not be able to buy a Medicare Supplement policy until you turn 65 years of age. Federal law does not require insurance companies to sell Supplement insurance policies to people under age 65.

Guaranteed Issue Rights

  • The applicant has the original Medicare plan, has an employer group health plan (including retiree or COBRA coverage) or union coverage that pays after Medicare pays, and that coverage is ending.
  • The applicant has the original Medicare plan, has a Medicare Select policy, and moves out of the Select plan’s service area.
  • The applicant is losing coverage due to their Medicare supplement insurance company’s insolvency or at no fault of the applicant.
  • The applicant has left their Medicare supplement plan because the company has not followed rules, or has misled the applicant.
  • The applicant was enrolled in a Medicare Advantage plan and that plan is leaving the Medicare program or stops service in the applicant’s area, or the applicant moves out of the plan’s service area (applicant must switch back to original Medicare).
  • The applicant was enrolled in a Medicare Advantage plan and the applicant leaves the plan because the company has not followed rules, or has misled the applicant.
  • The applicant was enrolled in a Medicare Advantage plan and the applicant decided to switch to original Medicare within the first year of joining a Medicare Advantage plan when first eligible for Medicare Part A at age 65.
  • The applicant was enrolled in a Medicare Advantage plan and the applicant dropped their Medicare supplement policy to join a Medicare Advantage plan for the first time, has been on the Medicare Advantage plan less than one year and wants to switch back.

Note: The medical underwriting department of each insurance company will determine your eligibility for “Guarantee Issue” based on information provided on your application. Be sure to keep a copy of any letters, notices, postmarked envelopes, and claim denials in case you need proof that you lost or ended health coverage. Medigap insurers may require these documents before they sell you a policy.