Buying insurance to fill Medicare’s gaps
Each year, older adults have important decisions to make regarding their Medicare coverage.
Original Medicare provides a number of great benefits to enrollees, but this coverage does have some gaps. For instance, Part B will cover only 80% of your medical expenses after you hit the deductible, with no out-of-pocket maximum. That means you could be on the hook for a significant bill if you become gravely ill.
Part A will only pay for the first 60 days you spend in the hospital, again after a deductible is met, before you must start paying co-insurance.
Because of this, many beneficiaries choose to enroll in either a Medicare Advantage plan or a supplemental policy to help cover those costs.
If you decide to go with a Medicare supplement policy (more commonly called medigap), you then must select which plan you want.
Medigap plans are administered by private insurance companies. These plans come in 10 letter designations (A through D; F; G; and K through N). All plans with the same letter have the same coverages, but prices can vary based on the insurance company you go with.
Which plan is right for you depends on your personal preferences and how much medical care you expect to need that year. The plans offer a range of benefits, with some covering many of your Medicare costs while others require more cost sharing.
Plan F has been the most popular because of its generous benefits. It covers the Medicare Part A hospital deductible and co-payments, the Part B deductible, and some emergency care outside the U.S.
Plan C covers many of the same benefits as Plan F, except it won’t pay for the Part B excess charge. This happens when a provider charges Medicare more than the amount approved by the program. The beneficiary is then responsible for that excess amount.
However, Plans C and F are no longer available to those who first become eligible for Medicare after Jan. 1, 2020. Medigap plans are no longer allowed to cover Part B deductibles.
Since both of these plans paid for that, insurance companies can no longer offer them to new beneficiaries. However, those already enrolled in such plans can keep that insurance.
If you were considering Plan F, then take a look at Plan G. It provides the same coverage as Plan F except for the Part B deductible.
If you don’t anticipate having many doctors’ visits, consider Plan N, which usually has lower premiums in return for some cost sharing.
Medicare.gov provides a chart that outlines what each medigap plan covers. (Click on “Find a Medicare Supplement Insurance (Medigap) policy.)
The website also provides a tool that allows you to compare different medigap plans available in your area. Enter your ZIP code, age, gender and whether you smoke, and Medicare will provide a price range for each available plan and a list of insurers who offer the coverage.
© 2021 The Kiplinger Washington Editors, Inc. Distributed by Tribune Content Agency, LLC.