Some Basic Information On Medicare Supplement Insurance
Medicare supplement insurance, also referred to as Medigap, bridges the gap between the coverage provided by the original Medicare and your out-of-pocket expenses for deductibles, copayments and coinsurance. Medigap policies pay only for the services deemed necessary by Medicare and according to the charges approved by them. Some Medigap plans may offer benefits, like emergency care when in a foreign country, that are not extended by Medicare.
Medicare supplement policies are sold by authorized private insurance companies. Every year, your Medigap policy is renewed automatically. If you happen to drop your Medigap policy, it may not be possible for you to get it back again. You may also not be able to purchase a new policy.
There are ten standard Medicare supplement insurance plans with each plan offering benefits of a different combination. The Medigap plans are labeled as Plan A, B, C, D, F, G, K, L, M and N. It is mandatory that every insurance company offer Plan A. If these insurance companies offer other plans, then they must also offer either Plan F or Plan C. Further, Plan F offers a high-deductible option, whereas Plans K, L and M feature a cost-sharing component.
The benefits of Medicare supplement insurance are:
For senior citizens who want to save during retirement, Medigap may be very important. This is because they live on incomes that are fixed and therefore the predictably consistent Medigap premium payment makes them feel comfortable. Medigap offers a number of options based on your current as well as future health requirements, age, budget and many other factors.Though your Medicare plan may offer many services, it can take care of only 80% of the costs approved by Medicare. The remaining 20% balance is your out-of-the-pocket expenditure. Medicare supplements will take care of your out-of-the-pocket expenses so that your medical expenses do not eat into your savings. As Medicare supplemental insurance plans follow set standards, all insurance companies must provide the same coverage within a plan.
The plan that offers the best benefits to you will have to be decided on the basis of your health needs and financial status. It is not right to assume that a basic plan that requires you to pay only a low premium is the best option if you have budgetary constraints. You must weigh the monthly premium that you have to pay with the unexpected health expenses that you are likely to incur before making a decision on affordability.
There are also a few other factors that you must take into consideration before making a decision to purchase a Medigap policy. This is because these factors can have an impact on the plans that you can choose and the rates that you have to pay.
The first factor is the open enrollment period. This period is for six months after your enrollment in Medicare. During this period, you can purchase any Medigap policy without the need for taking a physical or going through medical underwriting. Further, the insurance company cannot charge higher premiums because of pre-existing conditions. The second factor is related to your Guaranteed Issue period. During this period, you can switch the insurance company or your plan seamlessly.
The third important aspect that you should take into consideration is the age-rate policy. Companies may not always decide your premium based on age. They may follow the community-rated method, entry-age-rated method or the attained-age-rated method. However, your age and confidence in keeping your chosen policy will decide the best method of determination of premiums for you.
Summarizing, insurance companies can decide as to what plans they would like to offer. Therefore, you need to do a little bit of research to find out as to which provider is offering plans that meet your needs. You also must carefully assess your lifestyle, present health issues, family health history and the monthly premium that you can afford before taking a final call on Medicare supplement insurance.