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Medicare Supplement Insurance (Medigap)

Medigap What is a Medigap policy?

Original Medicare pays for many, but not all, healthcare services and supplies. A Medigap policy, sold by private insurance companies, can help pay some of the “gaps” that Original Medicare does not cover, such as copayments, coinsurance and deductibles. Medigap policies do not work with any other type of health insurance, including Medicare Advantage Plans, employer/union group coverage, Veterans Administration (VA) benefits or TRICARE. If you have Original Medicare and you buy a Medigap policy, both plans will pay their share of Medicare-approved amounts for covered healthcare costs. Some Medigap policies cover certain costs not covered by Original Medicare. Medicare does not pay any of the costs for you to get a Medigap policy.

Every Medigap policy must follow federal and state laws designed to protect you, and it must be clearly identified as “Medicare Supplement Insurance.” Medigap insurance companies can only sell you a standardized Medigap policy identified by letters A through L. Each standardized Medigap policy must offer the same basic benefits, no matter which insurance company sells it. Cost is usually the only difference between Medigap policies sold by different insurance companies. In Georgia, you may buy another type of Medigap policy called Medicare SELECT which requires you to use specific hospitals and, in some cases, specific doctors to get full benefits.

What Are Some Things Not Covered by Medigap Policies?

Medigap policies do not cover long-term care, vision or dental care, hearing aids, eyeglasses and private-duty nursing.

How do insurance companies set prices for Medigap Policies?

Each insurance company decides how it will set the price or premium for its Medigap policies. The way they set the price affects how much you pay now and in the future. Medigap policies can be priced or rated in three ways:

  1. Community-rated (also called "No-age-rated") – the same monthly premium is charged to everyone who has the Medigap policy regardless of age.
  2. Issue-age-rated – the premium is based on the age you are when you buy the Medigap policy.
  3. Attained-age-rated – the premium is based on your current age, so your premium goes up as you get older.

What Do You Need to Know if You Want to Buy a Medigap Policy?

  • Generally, you must have Medicare Parts A and B.
  • You pay a monthly premium for your Medigap policy to the private insurance company and you pay your monthly Medicare Part B premium.
  • A Medigap policy only covers one person. If you and your spouse both want Medigap coverage, each of you must buy separate Medigap policies.
  • It’s important to compare Medigap policies since the costs can vary and may go up as you get older.
  • The best time to buy a Medigap policy is during the 6-month period that begins on the first day of the month in which you are both age 65 or older and enrolled in Part B. After this initial enrollment period, your option to buy a Medigap policy may be limited.
  • In Georgia, limited Medigap policies are available to people with Medicare under age 65.
  • If you have Medigap and join a Medicare Advantage Plan, your Medigap policy cannot be used to pay your Medicare Advantage Plan copayments and deductibles.
  • If you already have a Medicare Advantage Plan, it is illegal for anyone to sell you a Medigap policy unless you are switching back to Original Medicare.
  • You have some guaranteed issue rights to purchase a Medigap policy.