Medicare Part B supplemental insurance is the cornerstone of your health care plan, covering regular doctors' visits, outpatient hospital care, emergency room visits and preventative care. Your Part B insurance is part of original Medicare along with Part A, which covers inpatient hospital visits and long-term care. You must enroll in both Medicare Parts A and B to purchase a supplemental insurance plan and is also required when purchasing Part D supplemental insurance. Intuitively, most supplemental policies, also called Medigap, will offer some coverage for both parts as well. Understanding how your Medicare policy works can help you determine how much Medicare Part B supplemental insurance you need.
Medicare Part B is an important component of your overall insurance and the one you will use for most services, from your yearly physical at the doctor's office to your seasonal flu shot. You will even use this component of your insurance for hospital stays up to three nights. Although your A component is included in your regular insurance taxes, you must pay a monthly premium for Part B insurance. Your original policy will cover 80 percent of the Medicare-approved total amount. Medical providers are allowed to charge up to 15 percent above this amount in what is called an excess charge. Coverage under Medicare Part B supplemental insurance can help pay for everything from coinsurance to these excess charges.
Your options for Medicare Part B supplemental insurance are encompassed in 10 standardized plans called Medigap policies. Each plan offers benefits for both parts of your original policyh, but not all plans add specific benefits for Medicare Part B supplemental insurance. The most basic Medigap policy is Plan A, which covers your 20 percent coinsurance. Medigap Plan B only adds the deductible for inpatient hospitality, but Plan C increases your Medicare Part B supplemental insurance by covering your deductible for all Medicare-covered services. The most comprehensive Medigap policy, Plan F, offers the greatest Medicare Part B supplemental insurance coverage by including all coinsurance, deductibles and excess charges.
There are a few key points to be aware of when you start to research supplemental coverage. Firstly, you must enroll in both parts of original Medicare before you can purchase a Medigap policy. The company you choose must also be licensed to sell supplemental policies in your state. Unless you have one of a few serious health conditions, you must wait until you turn 65 to purchase Medicare. You are not required to enroll immediately, however. If you have a policy through your employer, you can keep that coverage until you retire. Once you have enrolled in both parts of the federal plan, you have six months to purchase a Medicare Part B supplemental insurance policy to get the best rates with the fewest restrictions.
This six month period is called Open Enrollment. Purchasing your policy during this window is very important, particularly if you have a chronic medical condition or family history that could otherwise raise your premium rates. During Open Enrollment, you do not have to undergo medical underwriting to purchase your policy, which means that you are not required to take a physical. Your provider also cannot legally charge you higher rates because of a preexisting condition. Another important factor to consider when purchasing a supplement policy is your guaranteed issue rights, which outline when you can change or drop a policy without penalty.
Your monthly premium for supplement coverage can depend on many factors, including your age, lifestyle and even your zip code. Since Medigap policies are standardized, each policy under the same letter must offer the same benefits. However, companies are free to charge different rates for identical policies. Providers can charge different premiums to men versus women, smokers versus non smokers, and even people in different areas within a state. Providers can set rates by age based on one of three methods. Under the first, everyone with a particular policy pays the same rate, regardless of age. This is called the community-rated method. Under the second, called the issue-age-rated method, your rate is determined based upon the age you are when you enroll. As you get older, you keep your rate, adjusted only for inflation.
The third method, one of the most common, bases your rate on your age, determining an entry rate based on the age you are when you enroll and raising it slightly each year along with inflation. This is called the attained-age-rated method. Researching all your options regarding Medicare Part B supplemental insurance, including important deadlines and plans offered by local companies, can help you find the best coverage for your needs. A supplement policy can give you the peace of mind that your health is taken care of without breaking your bank.
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