How Do Medicare Supplement Plans Work?

Dec 15, 2023 By Triston Martin

These policies restrict the amount of money you'll have to pay for medical services if you're on Medicare and have a Medicare Advantage plan. As you may be aware, both Medicare Parts A and B have deductibles and other charges that you are responsible for paying out of cash. There are several factors that you will need to consider while making this decision. However, where do you even begin to begin?

What Does Medicare Supplement Insurance Cover?

What is a Medicare Supplement plan, or "Medigap," and how does it benefit you? Let's get started. Private insurance firms sell Medicare recipients like you Medigap and Supplement plans, collectively referred to as Medicare Supplements.

Insurance departments in each state regulate them. Depending on your location, rates and plans may differ. Original Medicare, which includes Medicare Parts A and B, entails certain out-of-pocket expenses on your part.

If you're hospitalized for more than 60 days, you'll have to pay a deductible of $1,556 in 2022 and daily copayments under Part A. The yearly deductible for Part B is set at $233 in 2020. Medicare covers 80% of authorized expenses after the Part B deductible.

Medigap Insurance: What Is It Good for?

Original Medicare requires you to cover the costs of deductibles, copayments, and a deductible of 20% of the total cost of medical care. You may be able to defer some or all of these expenses by purchasing a Medicare Supplement plan.

They "supplement" Medicare by filling up the "gaps." Generally, your Medicare Supplement plan will not cover charges not covered by Medicare so you will be responsible for any out-of-pocket expenses.

Medicare Supplement or Medigap plans cover Original Medicare's out-of-pocket payments. Your out-of-pocket expenditures may include the Part A hospital deductible, the Part B deductible, and the 20% coinsurance you are liable for, depending on your plan.

Is Medicare Supplemental Insurance Worth It?

For the most part, your Medicare Supplement plan will only cover services that Medicare covers, save for overseas travel. Allowable or covered by Medicare are the terms used for these expenditures. Medicare and the supplement plan would cover most "medically required" treatments in most cases.

Medicare will not cover services that are experimental or not medically required. Medicare's yearly "Medicare & You" guidebook and website give comprehensive details on eligible services. If you have any questions regarding a service, you can generally find the solution by fast searching on the website.

Medicare Supplement: What's The Process?

You must first enroll in Medicare Parts A and B before you may enroll in a Medicare Supplement plan. Social Security will handle enrollment in Medicare Part B if you only enroll in Medicare Part A when you reach 65, which is common if either you or your spouse are still working full-time.

A Medicare Supplement plan can be purchased after you have signed up for Medicare Parts A and B. Preexisting conditions aren't an issue when purchasing a Medicare Supplement plan during the first six months of Medicare Part B enrollment. It's referred to as a "guaranteed issue right." Any insurance company must accept your application.

How Do You Get Medigap?

You can only enroll in Medigap during this Open Enrollment Period if you are 65 or older and enrolled in Medicare Part B for the first time. Applying for a Medicare Supplement plan later may be denied, so make your decision soon. To find out if an insurance company will accept you, you must undergo an underwriting procedure.

A Medicare Supplement plan purchased during the one-time Medigap Open Enrollment Period will be assured to be accepted. In the future, you won't have to worry about being able to get health insurance.

How Much Does Medigap Insurance Cost?

Be aware of the current prices and the potential costs of a Medicare Supplement plan in the future. The cost of a health insurance plan varies from state to state, so where you reside matters.

For example, a monthly premium for the High-Deductible Plan F ranged from $34 in Los Angeles to $353 in West Palm Beach when looking at

You'll pay more or less based on where you reside and the insurance plan you decide on. Most of your medical bills won't be covered by the lowest plan, which costs $34.

Medicare Supplement vs. Medicare Advantage Plans

Trying to pick between Medicare Advantage and Medicare Supplement? Listed here are the two forms of insurance coverage. A few health-care costs are covered by Original Medicare (Part A and Part B), while the rest are not. Beneficiaries are still liable for any copayments and deductibles, which can quickly pile up even when medical services are covered.

Apart from these exclusions, Medicare doesn't provide coverage for routine vision and dental care, prescription medicines, or international emergency medical treatment under Parts A or B. Because Original Medicare doesn't cover these extras, you'll have to foot the bill for them if you have them.


Most Medigap insurance receives information about Medicare Part B claims straight from the Medicare program. The private insurance then pays the healthcare provider the difference.

It is not uncommon for insurers to make payments to hospitals based on Medicare Part A claim data. If a patient asks it, insurance companies are required by Medicare to pay Medicare-participating doctors directly.

A warning from the Centers for Medicare and Medicaid Services (CMS) has been issued to anybody purchasing a Medigap policy.

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