Essential facts about medicare supplement insurance

The ins and outs of this additional coverage to Original Medicare.

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Let’s say you’re 65 years young, you decided to sign up for Original Medicare with its standard Part A (hospital) and Part B (outpatient doctor and specialist care) plans, and are receiving medical insurance benefits as we speak. Well done! But now that you’re making regular doctor and specialist visits, you realize the coverage might not be enough, and it’s draining your monthly budget. How did that happen?

What you actually pay with Original Medicare

Medicare Part A is free if you or your spouse paid Medicare taxes while working, and the monthly premium for Medicare Part B is relatively low (around $134, in most cases).

But the combination of copayments (usually a flat fee, like $20 per visit to a health care provider), coinsurance (your portion of the bill for covered services, usually something like 20 percent), and the deductible (which is the set amount you pay for all your healthcare services before the insurance company starts to kick in and pay, too—a modest $183 in 2018 for Part B, but $1,340 for Part A) may be too expensive to get the care you need or want.

A $183 deductible may not be the fee that breaks you. But copayments add up, and 20 percent of the bills for doctor, specialist and hospital visits—of which many of us need more and more of as we get older—can add up. Add in your hospitalization deductible, and we could be talking about thousands of dollars. To ease the financial burden of these out-of-pocket extras, known as the coverage “gap”, you may choose to sign up for Medicare supplement insurance, which is also called Medigap.

How Medicare Supplement Insurance can help you

Medicare supplement insurance, or Medigap insurance, is sold by private insurance companies and helps pay for copayments, coinsurance, and deductibles, and sometimes additional services, depending on the plan. Most Medigap monthly premiums hover in the $100 and $200 range, but can cost more or less depending on the deductible and where you live.

What does Medicare Supplement Insurance cover?

In most zip codes, there are 10 types of Medigap plans. Examine each one carefully to make sure the plan you choose best meets your specific needs. In general, Medicare Supplement plans cover:

Medicare Supplement Part A coverage:

  • All plans pay 100 percent of Part A coinsurance and hospital costs up to an additional 365 days after your Medicare benefits are used up.
  • Most plans pay all or at least half of your Part A deductible ($1,340 for each 60-day benefit period in 2018)
  • Most plans pay 100 percent of the cost for blood transfusions and hospice care coinsurance or copayments
  • Some plans pay 100 percent of skilled nursing care coinsurance, while others cover at least 50 percent, and others zero.

Medicare Supplement Part B coverage:

  • Most plans pay 100 percent of Part B coinsurance or copayment.
  • Most plans do not pay any of your Part B deductible ($183) or excess charges (up to 15 percent of the fee for a medical procedure or service, if the doctor or hospital doesn’t accept the standard amount Medicare pays).
  • If you get sick while you’re out of the country…Some plans will pay 80 percent of your medical expenses (up to your yearly plan limits).

Note: Medicare Supplement policies typically don’t cover long-term care, vision or dental care, hearing aids, eyeglasses, or private nursing care.

How to get Medicare Supplement Insurance

Anyone who has Medicare Parts A and B can buy a Medicare Supplement policy, but Medicare Supplement has a limited open enrollment period—and missing it means you may get turned down. If you buy Medicare Supplement insurance within six months of turning 65, you are guaranteed enrollment in a policy, regardless of any existing health problems you might have. (And provided you faithfully pay your monthly premium, Medicare Supplement policies are guaranteed renewable and generally continue year after year automatically.)

After your six months of open enrollment are up, the companies that sell Medicare Supplement policies are perfectly within their rights to deny you coverage if you don’t meet their underwriting requirements. To find out how you can get Medicare Supplement coverage if you miss open enrollment, visit

Got all that? Good! Hopefully your health insurance decisions will be a little easier to make. Need more guidance? Check out our complete Guide to Medicare.

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