While Medicare is an important program to help beneficiaries pay for medical expenses, most people don’t realize that Medicare does not pay for all expenses. As a result, beneficiaries can still face significant out of pocket costs. A Medicare Supplement insurance plan (also known as a “Medigap” plan) is designed to cover many of the costs that Medicare does not.
Since it was signed into law in 1965, Medicare has been a significant part of the healthcare system helping tens of millions pay for medical expenses. However, it does not pay all expenses. Medicare is a program administered by the Federal Government and, as it exists today, consists of 4 Parts. Medicare Supplements are insurance policies underwritten by private companies and are available in 10 Standardized Plans in most states. Medicare Supplements help pay for medical expenses that Medicare does not.
While a large part of a beneficiary’s health care expenses is covered by Medicare Parts A & B, there are deductibles, copays and coinsurance requirements that create a potential for significant out of pocket costs. A Medicare Supplement plan can greatly reduce this liability.
In most of the country, there are 10 Medicare Supplement plans that have been standardized by state and federal law. Standardization means that a Plan G from Company X provides the exact same benefits as a Plan G from Company Y. The elements that will distinguish one Med Supp carrier from another are premium rates, carrier rating, and service.
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