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Medicare Insurance Supplement

A Medicare insurance supplement is a form of private supplement health coverage that every senior should research before enrolling in Medicare. Medicare, a federally run program originally designed for seniors age 65 and older, can only cover a percentage of the services it offers, leaving seniors with supplicant Medicare coinsurance payments for emergency room visits, regular checkups, overnight hospital stays and other important services. A Medicare insurance supplement, often called Medigap because it "closes the gaps" in what you must pay for insurance, covers this coinsurance so you aren't faced with hefty out-of-pocket expenses. Depending on the Medigap plan you choose, your Medicare insurance supplement may also cover your deductibles, excess charges and other expenses related to your health care.

How Supplement Insurance Works

When you enroll in Medicare, you typically sign up for three parts. The original Medicare plan consists of Part A, which covers inpatient hospital stays, hospice and other long-term care, and Part B, which covers general doctor's visits, preventative care and outpatient hospital care, including overnight stays up to three nights. The third part, Part D, covers prescription drugs. Your Medicare insurance supplement applies to Parts A and B, and you must be enrolled both these parts before you can purchase a Medigap plan. Parts A and B alone typically cover 80 percent of your medical care, leaving a 20 percent coinsurance fee. Without an extra form of coverage, this coinsurance must come from your savings. If you are a senior on a fixed income, medical expenses can put a dip in your nest egg.

Depending on the amount of coverage you need, you can choose from 10 standardized Medicare supplement insurance plans. The most basic plan, Medigap Plan A, covers your coinsurance plus the first three pints of blood you need drawn in a year. All companies must offer Plan A. The most comprehensive plan you can buy is Plan F, which covers your Part A and B deductibles, excess charges and emergencies that might occur while you travel abroad. This is the most popular plan. Researching each plan before you make a decision will allow you to make the most informed choice for you.

For example, if you travel abroad but don't require regular medical care, you might consider a plan with a low monthly premium that also offers foreign travel insurance. In this case, plans C or D might be good options. If you are in good health and the prospect of high out-of-pocket costs doesn't faze you should a medical emergency arise, you might consider a high-deductible policy like Plans K or L. It's important to remember, however, that once you choose a policy, it can be very difficult to change it. For this reason, the risk averse and those who don't have the savings to shoulder high medical costs should strongly consider a comprehensive Medicare insurance supplement.

Supplement Insurance Deadlines

One of the most important things to remember if you are considering a Medicare insurance supplement is your Open Enrollment period. Spanning the first six months after you purchase Medicare Parts A and B, your Open Enrollment period allows you to buy any policy available through insurers in your state without having to go through medical underwriting. During Open Enrollment, no company can deny you a policy because of your lifestyle, gender, age or preexisting conditions, and your preexisting conditions may not determine your monthly rate.

If you wait until your Open Enrollment period has expired, you still have a legal right to purchase a Medicare insurance supplement, but your options may be limited by a number of factors. Supplement insurance companies can charge higher premiums for tobacco users, older applicants, and seniors with preexisting conditions like hypertension or diabetes. Medicare insurance supplement providers can even charge higher premiums for men. A few factors beyond your control may determine your rate whether you sign up during Open Enrollment or not. Providers may charge people in certain zip codes higher premiums than applicants in others. Depending on their age-rate policy, you might also pay higher premiums as you get older. Conversely, your company might charge the same rate to everyone with the same plan, regardless of age.

Researching companies in your area will ensure that you secure the right plan for you at the best rates for your area. When investigating your options for a Medicare insurance supplement, remember to look at three important factors: the plans each company carries, the rates they offer people in your zip code, and what kind of age-rate structure they offer. A simple online search will give you the basics of supplement providers, allowing you to narrow your search to the companies with the best rates and plans. Following up with phone calls and interviews will allow you to find a company with a helpful and communicative staff.


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