How do Medicare Supplement Plans work?
KEY FACT: Medicare Supplement Plans are designed to compliment Original Medicare, not replace it.
Medicare Supplement Plans are designed to help fill the insurance gaps in your Part A and Part B Original Medicare coverage. When you enroll in a Medigap plan you’ll choose from one of the 10 types available and you’ll pay a Medigap premium in addition to your Original Medicare premium. Your Medigap carrier will then, depending on the benefits offered by your chosen plan, help cover your out-of-pocket healthcare costs.
What do Medicare Supplement plans cover?
KEY FACT: Medicare Supplement plans do not cover prescription drugs, to add this coverage you may choose to consider enrolling in a Medicare Prescription Drug plan.
Medicare Supplement Plans help cover out-of-pocket costs for Original Medicare Parts A and B. Benefits offered vary between plan types. Insurers can offer up to ten types of plans, which are labeled A, B, C, D, F, G, K, L, M, N, but they do not have to offer all ten different plan options. The benefits offered between the plan types vary, so for example Plan B offers different coverage than plan G. However, the plans are standardized so that each plan type of the same letter must offer the same coverage. This means that a Plan type A offered by one insurer will provide the same benefits as a Plan type A from another insurer making it easy to compare plans from different carriers.
The Medicare Supplement comparison chart below shows how coverage varies between plans:
*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 $2,340 in 2020 ($2,370 in 2021) 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.
If you are a resident of Massachusetts, Minnesota, or Wisconsin your plan options are standardized differently.