Medicare has been one of the most talked-about aspects of health insurance. There are many updates, upgrades, federal reforms, and inclusions. This happens with the medical and governmental input the health insurance program goes through. It is incredible how Medicare has continued to survive with a fruitful image all these years. There are many Medicare Supplements Pros that need to be discussed.
After all being able to learn things in this manner is a huge help. They usually make better decisions regarding their health insurance choices – Medicare does work for them.
However, with Medicare it has many different plans in its umbrella. There are Medicare Part A and B, Medicare Advantage Plans, PDP, and Medicare Supplement. You have an array of plans, parts, and parcels of Medicare to choose from. You can easily find something that fits your needs. Or, on the flip side, take help from your health insurance provider. Your carrier can educate you about these plans to make an informed decision. So whatever you choose becomes your long-term health coverage plan.
Given the love/hate relationship people have with Medicare, it’s essential to take dive into some of its pitfalls. Hence, we will be looking at Medicare Supplement and discussing some of its more cumbersome pros and cons. Some will choose bridging the gap of Original Medicare. Others the bridge is rather faulty – how so?
Let’s find out. But first things first, let’s start from the basics. Firstly, let’s find out what Medicare Supplement is, and there is a difference between Medicare Supplement and Medigap.
What Is Medicare Supplement?
Medicare has many parts and parcels of the whole insurance ordeal. There are different plans, parts, names, and so much to remember that it is easy to get confused. Your agent may truly try explaining it to you. If you take some time to get around knowing Medicare, you will know which plans suit you the best. This will finally stops confusing one for the other.
Medicare supplement is one such part of Medicare insurance, better known as Medigap. It is a type of health insurance policy that private insurance companies sell to complement Medicare policies. The basic idea quite obviously is to provide coverage for the cost of healthcare services. This usually does not fit within the realm of Medicare Parts A and B.
Hence, the name Medigap denotes how Medicare supplements can extend and bridge the gap left by Original Medicare. In addition to copays, coinsurance, and deductibles, Medigap is that part that covers the gaps in the standard insurance plans.
Difference between Medicare Supplement & Medigap
Even many knowledgeable people can sometimes get confused between Medicare Supplement and Medigap, so getting doubtful is understandable. However, make sure you understand this first before deciding on Medicare Supplement and Medigap. To cut it short, Medicare Supplement and Medigap are two different terms for the same health insurance product. Because some organizations prefer one over the other or use both interchangeably doesn’t make them any different.
How Does Medicare Supplement Work?
As we defined earlier, Medigap or Medicare Supplement is the insurance coverage program that bridges the gaps of original Medicare. It is a far more extensive plan. It rightfully so has many more plans. Different categories will break down the purpose of Medigap into more specific and better-suited variables.
Therefore, people who apply for Medicare Supplement are usually already eligible for original Medicare that is Part A and B. The Medigap policy doesn’t replace the original Medicare coverage plan. You get a more reformed choice to create a plan that best fits your needs.
The basic idea is to limit the costs of medical services once you are on Medicare through even further deductibles. Both parts of Original Medicare, i.e., Parts A and B, have out-of-pocket costs, copays, and deductibles. These are costs that make you pay up additionally. Hence, these are plans that limits those costs while filling the gaps of your health requirement. This is how a better-suited plan, which is, Medigap works.
What Does Medigap Cover?
In 2006, Medicare supplement plans stopped providing prescription medication coverage even though many beneficiaries still carried the policy throughout. Medicare moved on to include an additional Medicare Part D. People can purchase separately to reduce the costs of their medications.
And so it was marked separate from Medicare Supplement. This point is for people who are unable to keep up with the regulation changes. With different upgrades in Medicare every year, you can end up losing precious parts of plans. This will become more confusing to acquire something suitable.
Your Medicare supplement plan may generally provide coverage for services that the Original Medicare Plan covers. This will be except the one intermittent foreign travel policy. These are mainly known as the Medicare-allowed or Medicare-covered charges. Under certainly most medically necessary services that Medicare understandably covers, are so covered by the specifically suited Medicare supplement plan.
Contrary to popular belief, Medicare supplement isn’t our one-way ticket out of your country. We can’t just go to some foreign place for a medical procedure, followed by a covered vacation. It doesn’t cover any sort of experimental services or anything even remotely arbitrary. These procedures need to be medically necessary like prosthetics, aestheticians and plastic surgery, etc.
The Medicare authorities send out an annual handbook to their Medicare beneficiaries known as the “Medicare & You” journal. It allows detailed information insight to people for learning more about Medicare and Medicare supplement coverage. Moreover, you can always visit the website if you have any confusion. Let your agent know and they will explain it to you.
What Purpose Does Medigap Policy Serve?
Part A and B make up the basic and Original Medicare plans have out-of-pocket costs that the beneficiary pays. Part A has a general benefit period of hospitalization deductible amounting to $1,556 in 2022. Also, in addition to regular copayments that were made in case you were hospitalized for more than 60 days.
Similarly, Medicare Part B has an annual deductible that amounted to $233 in 2022. However, after the deductible of Medicare Part B, Medicare alone pays almost 80% of the allowable charges. Hence, with Original Medicare, you are likely to pay deductibles, copays, and 20% for services. These services you will receive from the doctors on your regular roundups.
Therefore, the purpose that the Medigap policy serves here is mainly paying the difference. The original balance amount that health coverage providers charge will be covered by the Supplement. Medicare supplement is likely to pay the majority of these costs for you. It supplements or fills the gaps left by Original Medicare.
If there is something the Original Medicare Plan doesn’t cover, a Medigap won’t cover either. A policy can do nothing much for you in that regard. It will cover only what Medicare originally covers, and you would have to pay for any out-of-network services yourself. They are designed per the Medicare original plan to pay off your costs and cover one person per policy. Therefore, you can’t even add up someone else to acquire the same benefits as you.
Medicare Supplement Cons – Why People Love to Hate The Medigap Policy?
Despite the many good things that circulate Medicare Supplement, certain drawbacks are too. It is understood that Medigap fills the “gap” left by Original Medicare. There are some reasonable disadvantages that come alongside the coverage subscription. We will need to be talk about it for transparency and educational purposes:
1. Higher Premiums Results into Higher Costs
One of the biggest reasons people can’t seem to wrap their heads around Medicare Supplement is its ever-increasing premium costs. This notion is that Medigap is sold privately by insurance companies. These insurance companies shall always take on a higher monthly premium to charge the patients for their business.
This case is more arbitrary when people don’t enroll during the Medicare Supplement Open Enrollment Period. Likewise, without any guaranteed issuing right, you can easily become a subject for medical underwriting. This will lead to a higher premium surcharge. Not to mention that Medigap premiums tend to increase annually.
This means that you can easily expect your premium cost to increase ever since you first started significantly. Moreover, you shall also be expected to pay Medicare Original part B premium monthly. You will have an additional deductible that hardly anyone talks about. Some Medicare Supplement plans may even open a deductible before your coverage starts.
2. No Prescription Drug Plan – Part D Coverage
One of the most requested, asked for, and yet declined aspects of Medicare Supplement is PDP. Prescription Drugs Plan Part D is unfortunately not a part of Medigap policy. In fact, despite the many parts of Medigap from A to N, none of the parts offer PDP coverage elements. There isn’t even any sort of coverage for dental and vision or hearing, for that matter.
Many people buy a standalone Medicare Part D policy to receive prescription drug benefits. They must be eligible for Medicare Original Part A and B. This leads to an extra monthly premium to an already piling cost of premiums they are paying. That’s why for many people, Medigap loses its charm right here.
3. Open Enrollment or No Guarantee
You must go to apply for the Medicare Supplement policy during the Open Enrollment Period. If not, you shall never be guaranteed the outcome in your favor. Yes, despite your age of 65 or above, Medigap doesn’t guarantee your coverage. The application needs to be submitted during the Medigap Open Enrollment Period.
4. Less Transparency – More Assumptions
One of the most damaging cons to the image of Medicare Supplement has to be the lack of transparency. This is from the insurance carrier’s end. This leads to more speculation and self-assumption rather than knowledge. For instance, people would rather assume something and make a decision instead of asking questions and making a knowledgeable one.
Many insurance carriers don’t mention that you may have to pay a penalty. They also don’t mention that you may be subjected to additional premiums. Usually, this is because of medical underwriting and inconsistencies from state to state, etc. Therefore, you must get educated in the matter or ask relevant questions. If not, chances are that you will be paying more than you should.
Medicare Supplement Pros – Why Should I Choose The Medigap Policy?
Despite being given some reasonable disadvantages that it serves, Medicare Supplement Pros outweigh the cons. The following are the list of advantages that Medicare Supplement serves. This is the reason why you should go for a Medigap policy despite a healthy enrollment in Original Medicare plans:
1. Nationwide Coverage
You receive nationwide coverage as long you travel within the United States. You need to go to an in-network healthcare professional and institution that accepts Original Medicare. This is with both Part A and B, then you will be covered under your Medicare plan. So no need to worry about paying more than estimated or not traveling because of your health coverage. Your plan shall allow you nationwide coverage within your cost.
2. Predictable Cost Outlines
All the Medigap plans are standardized. Once you finally select the package of all the benefits you may receive in a lettered plan draft. From there you can easily predict your costs. You receive more budgeted and predictable costs than unpredictable out-of-pocket costs that see no end. You are eligible to choose any of the Medigap plans from A to N. You’ll have a fixed monthly premium and almost nothing else on your medical expenses.
3. No Formal Referrals Required
Many people get annoyed at the fact that they can’t even switch medical personnel. This is unless they apply for a formal referral allowing them to do so. However, with Medicare Supplement, you would not require a formal referral to change your doctor. You can see a different specialist who can help you take better care of your health issues. The specialist you are seeing must accept Medicare. They need to be within the Medicare network, you are good to go for the coverage.
4. No Unprecedented Plan Cancellations
You are basically getting an officially guaranteed renewable with Medicare Supplement. This means that there is no way that you can get canceled amidst the plan payments. Unless, of course, you forget to make the payment for the premium on time. Hence, all you have to ensure is that you make your payment before the due date, and that’s is it. No more worrying and fretting about unpredictable cancellations or dropping out of the plan. Your Medigap policy would suffice as long as you want it to.
5. Standardized Coverage & Healthcare
Probably one of the best and most promising advantages of Medicare Supplement is that you receive standardized coverage. There are ten Medicare Supplement plans available to choose from in all of the 47 states of America. Therefore, you don’t need to worry about paying more or compromising your healthcare if you move states. You will receive the same coverage and healthcare regardless of the place and company you apply with.
Final Thoughts
All in all, it is important to have a clear discussion about Medicare and Medicare Supplement plans. This should happen as early as possible because you never know what the next update may bring. Moreover, don’t wait too long until a crisis occurs to decide about a likely acquisition of Medicare Supplement. Instead, start the dialog when you are in the best physical, mental, and financial health. Not to mention that a late discussion would mean a late step in the right direction. This can significantly reduce your options of acquiring a suitable Medicare Supplement. So don’t wait up too long as clarification and participation are key to understanding something as important as Medicare Supplement.
United Insurance is a national company helping community members choose the best Medicare options available. United’s mission is to guide seniors proactively by offering a clear picture of today’s healthcare coverage options like Medicare. We bestow a true family environment built on honor and trust. Focus on dedication to professionalism, knowledge, and follow-through is our recipe for winning the hearts of our customers.
Contact us to get started on your Medicare journey right away!