Also known as "Medigap" plans, Medicare supplement plans work hand-in-hand with Original Medicare Parts A and B. Medicare supplement plans cover most, if not all of the out-of-pocket costs Original Medicare does not cover. These costs include deductibles, copayments and coinsurance. As a result, you pay very little, if any, costs for healthcare other than your monthly premium.
Although the monthly premium may be higher than a Medicare Advantage plan, many people choose a Medicare Supplement plan because they like not having out-of-pocket costs when receiving healthcare services. Members also have the freedom to choose any doctor or hospital that accepts patients on Medicare — no referral is required.
Unlike many Medicare Advantage plans, however, Medicare supplement plans do not include prescription drug coverage. Therefore, most people decide to buy a prescription drug plan to go along with a Medicare supplement plan.
Because Medicare supplement plans are regulated by the federal government, the benefits of a particular plan (such as Plan C or Plan F) are exactly the same, regardless of the insurance company you choose. Important differences between insurance companies, however, are found in price, customer service and the experience and reliability of the company from which you purchase the plan.
You are eligible to apply for a Medicare supplement plan if you are enrolled in Medicare Parts A and B. If you're turning 65 and decide to apply for a Medicare supplement plan, you can do so as early as six months prior to your Medicare Parts A and B effective date.
Your decision regarding when to apply for a Medicare supplement plan may be affected by your availability of employer-sponsored health insurance. If you plan to continue working past age 65 or if you are eligible for your spouse's employer-sponsored health insurance, you may want to defer your enrollment in Medicare Part B and delay purchasing a Medicare supplement plan.
Typically, it is best to apply for a Medicare supplement plan during your Medigap open enrollment period (the sixth-month period beginning the month you turn 65 and enroll in Medicare Part B). If you apply within this six-month period, you will be guaranteed coverage in certain Medicare supplement plans, regardless of any health conditions you may have.
If you miss one of the guaranteed opportunities, such as your Medigap open enrollment period, your health condition will be considered and you may or may not be able to get Medicare supplement coverage. Your acceptance will be based on your answers to health questions.
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