When should I enroll in a Medigap insurance plan?

What is Medigap? Explaining Medigap Insurance Plans

If you are preparing to enroll in Medicare, you are about to join nearly 62 million of your fellow Americans in one of the most sound health insurance plans in the U.S. As you are likely well aware, Medicare is made up of several different parts, each of which have slightly different coverage benefits, rules, regulations, and factors to consider.

When you first enroll in Medicare, you primarily enroll in Medicare Parts A and B, which are known collectively as “Original Medicare.” While this program continues to assist millions of seniors and qualifying disabled individuals each and every year, you may be surprised to learn that Original Medicare does not always cover every healthcare treatment or service you may encounter as you age.

This is where an additional Medicare plan, such as a Medigap Supplement Plan, can come in handy. A Medigap insurance plan is designed to help you cover the gaps in your Original Medicare health insurance benefits, sparing you the headache of having to cover many uncovered medical expenses out-of-pocket. 

In other words, in exchange for a reasonable monthly premium, a Medigap Supplement Plan will help you pay for most things that can slip through the cracks of Original Medicare coverage.

Medigap vs. Medicare Advantage: What’s the Difference?

If the concept of a Medigap insurance plan sounds familiar to you, you are not alone. Many people sometimes confuse a Medigap plan with another form of health insurance that is designed to help you cover the holes in Original Medicare coverage: a Medicare Advantage plan.

It is important to note that a Medicare Advantage plan is an entirely different entity than a Medigap supplement plan. Typically, Medicare Advantage plans are designed to replace your existing Original Medicare coverage with a privately-sold plan that is required to cover the same benefits as Original Medicare. In addition, Medicare Advantage plans usually offer a few extra healthcare services and treatments that you may need in the future in exchange for higher premiums on average.

What are the benefits of enrolling in a Medigap policy?

If you have ever seen a breakdown of a hospital bill in detail, chances are the extremely high costs associated with your treatment surprised you. In addition to the medical care charges, doctors and providers are likely to send you additional bills that are asking you for even more money. Naturally, paying for these services out-of-pocket is not a winning strategy for most people.

Even if you have Original Medicare, you may still experience gaps in your healthcare coverage, and these can quickly become overwhelming. That’s where a Medigap Supplement Plan comes in. Here are just a few of the most common benefits of enrolling in a Medigap Supplement Plan:

Medigap can provide assistance with out-of-pocket costs.

Did you know that unlike most health insurance plans, Original Medicare does not have a cap on how high your out-of-pocket healthcare costs can get? Considering a Medigap Supplement Plan can be a great option for this reason, as these plans are designed to help you pay for some, or all, of the out-of-pocket costs that Original Medicare does not cover.

Medigap can provide assistance with chronic illnesses treatments and services.

If you suffer from a chronic illness, such as diabetes, COPD, or other conditions that typically carry a high cost of treatment and medical services, a Medigap plan may be a great resource for you. With a Medigap plan, frequent doctor’s appointments, lengthy hospital stays, and expensive medical equipment and treatments are usually more affordable, as opposed to the costs associated with a full Medicare Advantage plan. 

Medigap does not require referrals.

For many Medicare health insurance plans, you are required to receive a referral from your primary caretaker until you are approved to see a specialist. With a Medigap insurance plan, this is a non-issue (with exceptions in some Medicare SELECT states).

Medigap can offer a wider selection of provider choice.

Compared to Medicare Advantage, Medigap Supplement Plans can often give you greater access to your choice of doctors, since most Medigap plans do not ask you to adhere to a pre-approved provider network. Usually, any doctor, hospital, or medical center that accepts Medicare assignment is required to take your Medigap insurance.

Medigap allows for separate drug coverage.

Medigap plans will also allow you the flexibility to have a separate policy for prescription drug coverage. Typically, this is done through the addition of Medicare Part D, which is primarily responsible for helping you afford both generic and name-brand prescription medications.

When is the right time to enroll in a Medigap Supplement Plan?

Quite frankly, the best time to enroll in a Medigap insurance plan is as soon as you are eligible. When you first sign up for Original Medicare (and more specifically, Medicare Part B), federal law dictates that you be given six months from that date to enroll in Medigap Supplemental Coverage.

Should you choose not to enroll in Medigap coverage at that time but decide to do so later, you will be subject to a long list of health-related questions (including a detailed prescription history) when you apply for Medigap coverage in most states. 

If you are interested in enrolling in a Medigap Supplemental Insurance Plan as soon as you enroll in Medicare coverage, don’t run the risk of being denied or having to wait even longer to sign-up.