Most Medicare plans do not pay for all of your healthcare costs.  Medigap policies are intended to help you pay for the “gaps” in Medicare insurance like co-payments, coinsurance, and deductibles.  In addition to offering financial assistance, these policies may also offer additional benefits like emergency health care while traveling outside of the United States. These plans are also called “Medicare Supplemental Insurance”.

 The costs of these policies include a monthly premium paid to a private insurance company.  The payment of medical services is first paid for by Medicare and then Medigap will pay its share.  At the end of the month, your Medigap insurance company will send you information on what it paid on your behalf.

 Eligibility

 A person must be enrolled in part A and B of medicare before they can enroll in a Medigap plan. During the open enrollment period which begins within 6 months of turning 65 or enrolling in Medicare Part B at 65 or older, a person may obtain a Medigap plan on a guaranteed issue basis (i.e. no medical screening required). Outside of open enrollment, the issuing insurance company may require medical screening and may obtain an attending physician’s statement if necessary. Medigap insurance is not compatible with other forms of private Medicare coverage, such as a Medicare Advantage plan.

 Products Available

Medigap, offerings have been standardized by the Centers for Medicare and Medicaid Services (CMS) into twelve different plans, labeled A through L, sold and administered by private companies. Each Medigap plan offers a different combination of benefits. The coverage provided is roughly proportional to the premium paid. However, many older Medigap plans offering minimal benefits will cost more than current plans offering full benefits. The reason behind this is that older plans have an older average age per person enrolled in the plan, causing more claims within the group and raising the premium for all members within the group. Since Medigap is private insurance and not government sponsored, the rules governing the sale and offerings of a Medigap insurance policy can vary from state to state. Some states such as Massachusetts, Minnesota, and Wisconsin require Medigap insurance to provide additional coverage than what is defined in the standardized Medigap plans. Some employers may provide Medigap coverage as a benefit to their retirees.

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

• Generally, you must have Parts A and B to buy a Medigap policy.
• You pay a monthly premium for your Medigap policy to the private insurer, and you pay your monthly Part B premium
• A Medigap policy only covers one person. If you and your spouse both want Medigap coverage, you each 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. (Prices may be limited by state law.)
• 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. (Some states have additional open enrollment periods.) After this initial enrollment period, your option to buy a Medigap policy may be limited.
• If you are under age 65, you may have additional rights to buy a Medigap policy, depending on the laws in your state.
• If you have a Medigap policy and join a Medicare Advantage Plan (like an HMO or PPO), your Medigap policy can’t be used to pay your Medicare Advantage Plan copayments and deductibles.
• If you already have a Medicare Advantage Plan, it’s illegal for anyone to sell you a Medigap policy unless you are switching back to Original Medicare. 
•  If you join a Medicare Advantage Plan for the first time, and you aren’t happy with the plan, you have the right to return to Original Medicare within the first 12 months of joining. If you joined when you were first eligible for Medicare, you can choose from any Medigap policy. If you had a Medigap policy before, you can get the same plan back (without any prescription drug coverage) if the company still sells it.
• You can’t have drug coverage in both your Medigap policy and a Medicare drug plan.