Medicare Supplements, also known as Medigap plans, are plans that help you fill the “gaps” in Original Medicare, by covering the out-of-pocket costs associated with Original Medicare. These policies are sold by private insurance companies and work in tandem with Original Medicare.
Since Original Medicare requires that you pay up to 20% of all Part B services, you could be faced with a large financial burden if having to pay that 20% on your own. A Medicare Supplement policy can help pay some of the remaining health care service costs, such as copayments, coinsurance and deductibles.
However, unlike Medicare Advantage plans, Medicare Supplement plans do not offer coverage for additional benefits. These policies generally don’t cover dental, vision and hearing services, wellness care and other added benefits that a Medicare Advantage plan covers. Also, prescription drugs are not covered by a Medicare Supplement plan, so a stand-alone prescription drug plan would need to be added.
There are 10 Medicare Supplement plans available (depending on where you live and when you became eligible for Medicare). Each policy offers a different set of standardized benefits, meaning that Plan A with one insurance carrier offers the same benefits as Plan A with a different insurance carrier. However, premium amounts can vary from company to company.
See the chart below for a list of Medicare Supplement plans and their coverage levels:
* Plans F and G also offer a high-deductible plan in some states. With this option, you must pay for Medicare-covered costs (coinsurance, copayments, and deductibles) up to the deductible amount of $2,700 in 2023 before your policy pays anything. (Plans C and F aren’t available to people who were newly eligible for Medicare on or after January 1, 2020.)
** For Plans K and L, after you meet your out-of-pocket yearly limit and your yearly Part B deductible, the Medigap plan pays 100% of covered services for the rest of the calendar year.
*** Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to a $50 copayment for emergency room visits that don’t result in inpatient admission.
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