Medicare Supplement Plans

Medicare supplement plans, a.k.a. Medigap or medsup, fill in the gaps of your Medicare coverage. Depending on the plan, they pay the part A deductible, and the cost sharing of part B, etc.

As opposed to the Advantage plans, Medigap plans do not have network restrictions on doctors or hospitals. You can see any doctors as long as they accept Medicare. However, they do not come with a prescription-drug plan (PDP), so you will have to get a standalone PDP. Unlike Advantage plans’ pay-as-you-go approach, you often don’t need to pay co-pays or co-insurance, depending on the plan. On the other hand, these plans require you to pay “upfront,” i.e., higher premiums. They are guaranteed renewable meaning that no medical questions will be asked if you keep paying the premium which often increases every year.

Advantage plans have a set annual maximum out-of-pocket not exceeding $6700. Many medigap plans do not have limitation on out-of-pocket costs, meaning that you can be on your own if disaster happens. The plans can work better for people in certain situations, e.g., those who visit doctors or hospitals often.

The government (CMS) defines available plans by letters (though availability varies by location) as shown in the table below.

Note that starting January 1, 2020, Medigap plans sold to people who are new to Medicare won’t be allowed to cover the Part B deductible. Because of this, Plans C and F will no longer be available to people new to Medicare. In other words, if you did not enroll in part B or Medicare plans when you first became eligible, you will still be able to enroll in Plans F or C. However, from what I have heard, it appears that plan F will have a significant premium increase, possibly because of the limitation on enrollment. (Plan F is considered the “Cadillac” of Medicare plans.)

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