Do I Need Medicare Supplement Insurance?

by Weiss Ratings | November 14, 2011

If you’re one of 48 million Medicare beneficiaries, you probably know that Medicare won’t cover many of your annual health expenses. You may also know that you can buy insurance to supplement your Medicare coverage.

While you review your coverage this year, it’s a good time to gather the information you’ll need to determine if a Medicare supplement policy is right for you.  And, how much insurance coverage you can afford without breaking your piggy bank. 

You’ll want to start by taking a look at …

Services that aren’t covered by Medicare

  • Deductibles
  • Co-payments
  • Amounts a doctor actually charges you that are in excess of the fees set by Medicare. 
  • Long-term care outside of a nursing home, or care at home, unless it’s provided by a professional nurse or therapist 
  • Care for daily living such as walking, dressing, bathing, shopping, eating and taking medicine
  • More than 100 days of Skilled Nursing Facility (SNF) care following a hospital stay 
  • Home services for cooking or cleaning
  • Private-duty nurse
  • Dental care and dentures
  • Health expenses for travel outside the U.S., except in limited circumstances
  • Emergency care in a foreign country
  • Cosmetic surgery
  • Routine foot care
  • Regular eye care or eyeglasses except after cataract removal
  • Hearing aids

How can I offset costs not covered by Medicare?

To cover more of the cost of services that Medicare doesn’t pay, you can buy Medicare supplement insurance.   Because it helps cover some of the “gaps” in Medicare coverage, Medicare supplement insurance is often called Medigap insurance. 

Am I eligible for a Medicare supplement policy?

If you are enrolled in Medicare Parts A and B and are at least 65 years old, you are eligible for a Medigap plan to cover many of the costs of medical care beyond those covered by Medicare itself. 

Information about Medigap

Medigap policies pay for services that are medically necessary, and the benefit amounts are set by Medicare.    

While Medigap plan benefits are set by the federal government, some plans offer services that Medicare won’t cover. These plans are sold by private insurance companies that are licensed and regulated by the Department of Insurance in your state of residence.

Unless you select a new plan, your Medicare supplement policy will automatically renew each year.  But, you’ll need to be careful if you decide to switch plans, because some health issues can prevent you from being able to buy a new policy or get a policy back after you’ve let it go. 

What is Medicare Select?

This type of Medicare supplement policy has the same benefits as Medigap policies, but requires you to use doctors and hospitals in the plan’s network. When you go outside the network for hospitals or emergency care, you’ll pay more of the cost.  If you leave a Select plan, the company has to offer you a Medicare supplement with similar benefits, if they have one. 

Medicare Supplement Insurance Plans

There are 10 Medicare supplement insurance plans (A, B, C, D, F, G, K, L, M and N).  And each plan type offers different benefits that are set by the government. 

If you choose Plans F (with high deductible), K, L or M, you’ll share a greater portion of the costs through higher coinsurance and copayment rates.    

Medicare Supplement Benefits

The 10 standard Medicare supplement plans (A-N) offer these basic benefits:

  • Hospitalization:  Medicare Part A copayments from day 61 through day 90 of a Medicare benefit period, copayments beyond day 90 up to an additional 60 days in your lifetime, and coinsurance plus coverage for 365 additional days after Medicare benefits end.
  • Medical expenses:  Covers your portion of the 20% Part B coinsurance for eligible expenses including doctor bills, hospital or home care, and specific payments for certain services after you’ve met the Part B deductible.  For Plans K and L, you’ll have to pay a higher rate for the coinsurance payment.
  • Hospice: Pays coinsurance for outpatient drugs and inpatient care.  Again, if you have Plans K or L, you’ll pay higher coinsurance and copayments.  And, of course you have to have a doctor’s certification.
  • Blood:  Covers reasonable costs for the first three pints of blood each year.

There are many additional benefits included for all plans except Plan A. 

If you live in Wisconsin, Massachusetts or Minnesota, there are different types of Medigap plans sold in your state, but they are still standardized across insurers.

You can find more information about plan benefits, and you can compare actual premium prices for Medigap policies available in your area, at  Weiss Ratings does not sell insurance, but it does give consumers access to pricing data for more than 165 Medigap insurers. We’ve looked, and you won’t find this kind of premium-price comparison information anywhere else.

Weiss offers a personalized report for consumers to compare Medigap insurance premiums for their age, gender and zip code.