Medicare supplementary insurance, or a medigap policy, can bridge any gaps in existing medicare coverage. For additional monthly premiums, there are various policies available for those in retirement. Typically, Part A, B, or C policies correspond to different costs and levels of coverage, with some parts designed for specific coverage goals. To understand the costs and opportunities associated with a medigap insurance policy, retirees should research the underlying costs not covered by medicare alone. The following are examples of medical costs that different medigap policies can help cover.
Covering Prescription Drug Costs
Expensive prescription drugs can be covered by medigap policies depending on the costs of the drugs. These so called “donut holes” are often a problem for retirees who have special drug needs. The most expensive medigap policies will cover prescription drugs as well as most other procedures. However, a medigap part D policy specializes in covering prescription drugs alone and is often cheaper than plans that cover everything. Retirees should consider a medigap part D policy if they primarily face high prescription drug costs.
How Medigap Impacts Copayments
Depending on the type of plan, a medigap insurance policy can reduce the cost of insurance copayments. Supplemental insurance plans often require large copays for procedures they don’t explicitly cover. More expensive medigap plans will cover more types of medical procedures like doctors appointments, specialist referrals, and medical tests. Less expensive plans tend to specialize their coverage, such as a part G plan that covers nursing facility copays. For retirees who require many different medical services, large copays are a significant concern that the right medigap plan can cover.
Medigap Policy Deductibles
Different types of medigap policies offer help for retirees with their deductible payments. Medicare on its own may have higher deductibles for certain treatment plans or doctor’s visits. Medigap plans can help this by eliminating the deductibles or keeping them at more manageable levels. For example, a Part L plan has a yearly deductible of around $3000, after which it covers the cost of any additional procedure. Other plans, like Part F, have a higher deductible but lower premiums, allowing for increased coverage at a lower annual cost. People with medicare insurance plans should consider how a medigap policy can help their deductible costs.
Costs Of Coinsurance
In addition to deductibles, medigap policies can supplement the costs of coinsurance that medicare alone requires. For example, a medicare policy alone may have a 20% coinsurance rate. This means that even if the deductible amount is met policyholders must pay 20% of the cost of all doctor’s visits. Some medigap policies cover all of these coinsurance costs so that once the deductible is met, policy holders pay no coinsurance. Other policies have no coinsurance but instead have an out-of-pocket limit, meaning coinsurance is not paid once that limit is reached. Seniors after retirement struggling with high coinsurance rates may be helped by the right medigap policy.
People insured under medicare alone may face difficulties relating to out-of-pocket costs for pre-existing conditions. For example, a medicare policy may require a waiting period until care can be provided. These policies may also require patients to pay for these procedures in part or in whole. Medigap insurance policies can help cover the costs of dealing with pre-existing conditions. For example, certain medigap policies can cover of the cost of an extended skilled nursing care plan. These policies can eliminate the out-of-pocket expenses that retirees with pre-existing conditions may face.
The specific costs of a medigap health insurance policy vary by state and coverage plan, but all of them are designed to help with costs not covered by medicare alone. Some plans are designed to cover prescription drug costs not covered by medicare. Medigap policies can also be built around managing insurance copays. Other policies are designed around balancing deductible costs and the additional coverage offered by medigap policies. Coinsurance concerns can also be addressed by the right medigap policy. Finally, retirees with pre-existing conditions can get a medigap policy to cover the out-of-pocket costs associated with their condition. For retirees looking to suppliment their medicare insurance and keep the cost of health care low, they can look into medigap policy coverage.