Medigap is a type of supplemental health insurance to help fill in any gaps in coverage (hence the name) not filled by Medicare. Medigap is sold by private insurance companies and covers things such as deductibles, coinsurance and co-payments. You can also opt for a Medigap policy that covers specific health care needs that are not covered by Medicare, including medical care services while traveling out of the country.
What You Need to Know About Medigap
There are eight important things you need to know about Medigap policies:
- In order to enroll in a Medigap plan, you must already have both Medicare Part A and B.
- You can apply for a Medigap plan if you have a Medicare Advantage Plan, but you cannot maintain both plans at the same time. This means you will have to cancel the Medicare Advantage Plan before the Medigap plan starts.
- You will pay a monthly premium to the private insurance company providing your Medigap plan in addition to the monthly Part B premium you pay to Medicare.
- Your Medigap policy will only cover the person named on the policy. If your spouse also wants a policy, he or she will have to purchase a separate policy.
- You can buy a Medigap policy from any insurance company that is licensed in your state to sell one.
- A standard Medigap policy provides the policy holder with a guaranteed renewable clause even if they develop health problems. In other words, the insurer cannot cancel the Medigap policy as long as the premiums are paid.
- Medigap no longer covers prescriptions, so if you want prescription coverage you will need to join Medicare’s prescription drug plan, also known as Part D.
- It is illegal for any insurance company to sell a Medigap policy to anyone who has a Medicare Medical Savings Account (MSA) Plan.
Enrolling in Medigap
You can enroll in any Medigap policy sold within your state during the six months immediately following your enrollment in Medicare Part B. During that time, you cannot be denied Medigap insurance or charged higher premiums due to health problems. Once the open enrollment period ends, you might not be able to buy the policy of your choice; rather, you might have to simply accept whatever Medigap policy an insurance company is willing to sell you.
Residents of the state of the state of Missouri can shop for their plan yearly during the 30-day period before and after the anniversary date of when their policy was purchased. In other words, you have a total of 60 days (two months) to make changes to your plan or choose another plan. For example, if you are on a Plan F, you can switch to another plan F with a lower premium without answering any health questions.
If you qualify for a different type of plan or want to change insurance carriers, or if you qualify for another type of Medicare supplement outside of the anniversary date, you must answer health questions.
The ACA’s solution of no pre-existing conditions does not apply here. Note that Medicare supplements can have multiple rate increases per year. There is no regulation here.