Medicare Supplement Plans, also known as Medigap or MedSup Plans, perform as a complement to Medicare by filling in the gaps that your Original Medicare Plan does not cover. These policies are sold by private companies and can help lower your out-of-pocket costs such as copays, coinsurance, deductibles, foreign travel care, etc. When you purchase a policy, you pay a monthly premium to the private insurance carrier in addition to the Part B premium that you pay to Medicare. After Medicare has paid its coverage on a service or procedure, your MedSup Plan will pay the remainder of your overall cost.
In most states (except Massachusetts, Minnesota, and Wisconsin), there are ten types of MedSup policies that are labeled with a different letter. It is important to know that these letters do not have the same meanings as they do in Original Medicare or Medicare Advantage Plans. The letters in Medigap policies represent different levels of guaranteed benefit coverage. Plan benefits are standardized across states, though costs may vary. For example, if you purchase a Plan C Medicare Supplement Plan in Florida, you would receive the same benefits as someone who purchased a Plan C Medicare Supplement Plan in California, but they may pay more for it.
While Medigap Plans do not cover prescription drug coverage, vision or dental, long-term care, or private-duty nursing, they do offer protection from unexpected medical costs. They close the gap between the total cost of health care and the expenses that Original Medicare covers. Medicare Supplement Plans also bring peace-of-mind by establishing an out-of-pocket maximum; as soon as you meet your out-of-pocket yearly limit and your yearly Part B deductible, your MedSup policy will cover 100% of any qualifying costs.
If you visit the doctor frequently, know you will need durable medical equipment, are facing hospitalization, or are planning a trip overseas, purchasing a Medicare Supplement Plan could keep you out of extreme debt incurred by medical bills.