Medicare Supplement (“Medigap”) Insurance

Medicare has two parts: Part A (Hospital Insurance) and Part B (Medical Insurance).However, Medicare does not pay for all hospital and medical bills you incur. There are strict limits regarding what is and isn’t covered.

Medicare Part A covers some costs related to hospital stays and is available for people who are 65 years old and over. Medicare Part B covers somecosts related to doctor visits, tests, supplies, and outpatient services. Both Medicare Parts A and B cover only those services that are considered “medically necessary” and only those charges that are considered “reasonable.”

Given this information, it should come as no surprise that there are often major gaps between the hospital and medical bills you incur and what Medicare actually pays for.

To cover these gaps, you can purchase Medicare supplement insurance — also known as “Medigap” insurance. However, Medicare supplement insurance plans vary tremendously. Some may be benefit-rich, while others may provide only very basic benefits. Ultimately only you can decide if a plan fits your lifestyle and budget, but we strongly recommend that you consult a professional before making any decision.

In addition, you should be aware of these pitfalls:

  • Medicare supplement insurance does not fill all gaps, so still be prepared for some out-of-pocket expenses.
  • You must be enrolled in Medicare Parts A and B to be eligible for Medicare supplement insurance.
  • It is illegal for someone to sell you a duplicate policy — do not purchase a duplicate!
  • If you will be replacing an existing policy, be very careful and do so only with full awareness and complete understanding.
  • Do not purchase Medicare supplement insurance if you are eligible for Medicaid. Contact your state welfare department instead.