Medicare Supplement insurance fills the gaps that Original Medicare leaves behind

Original Medicare (Parts A and B) covers a lot, but not everything. You still pay deductibles, copayments, and coinsurance. You also have no coverage if you travel outside the United States. Medicare Supplement insurance, also called Medigap, is a private insurance policy sold by insurance companies that pays some or all of these out-of-pocket costs. It works alongside Original Medicare — it does not replace it.

Medigap policies are standardized by the federal government. That means a Plan G from one insurance company covers the same things as a Plan G from another company. The price differs, but the coverage does not. This makes it easier to compare plans and switch insurers if you find a better rate.

You can only buy Medigap if you have Original Medicare (Parts A and B). If you have a Medicare Advantage plan instead, you cannot use Medigap, though you may want to understand the trade-offs between the two approaches.

Key Takeaways

  • Medigap policies are sold by private insurance companies and pay deductibles, copayments, and coinsurance that Original Medicare does not cover.
  • Ten standardized Medigap plans exist (A, B, D, G, K, L, M, N, and two high-deductible versions of G and F), and the same plan letter covers identical benefits no matter which company sells it.
  • You have a may provide issue period of six months starting the first day you are enrolled in Medicare Part B, during which insurers cannot deny you or charge more based on health history.
  • Monthly premiums vary widely by insurance company, location, and age, so comparing quotes from multiple insurers can save hundreds of dollars per year.
  • You must keep paying your Original Medicare premiums (Part B and usually Part D) in addition to your Medigap premium.

The ten Medigap plans and what each one covers

The federal government defines ten standardized Medigap plans. Each plan is labeled with a letter and covers a different combination of costs. Plan A is the most basic and least expensive. Plan G and Plan N are the most popular among new enrollees because they cover most out-of-pocket costs without being the most expensive option.

All plans cover the Part A deductible (the amount you pay before Medicare hospital coverage kicks in), coinsurance for hospital stays, and the first three pints of blood. Most plans also cover the Part B deductible and coinsurance for doctor visits and outpatient care. Some plans cover foreign travel emergency care if you are outside the United States.

Plan G is the most comprehensive plan available to people new to Medicare. It covers nearly everything except the Part B deductible (which is $240 in 2024, though this amount changes yearly). Plan N covers most costs but leaves you responsible for some copayments at the doctor and emergency room. Plan A is cheaper but covers fewer costs — you pay more out of pocket when you use care.

Two high-deductible versions of Plan G and Plan F exist for people willing to pay a large deductible before the plan starts paying. These plans have much lower monthly premiums but require you to pay several thousand dollars out of pocket before coverage begins. They work best for people who expect to use very little medical care.

When you can buy Medigap and the may provide issue period

You can buy Medigap at any time, but the best time is during your may provide issue period. This is a six-month window that starts on the first day of the month you turn 65 and enroll in Medicare Part B. During this period, insurance companies must sell you any Medigap plan you want at the standard rate. They cannot turn you down, charge you more, or exclude conditions based on your health history.

If you miss this six-month window, you can still buy Medigap later, but insurers may deny you, charge you more, or exclude certain conditions if you have pre-existing health problems. Some states have additional protections that extend may provide issue rights, but these vary. Once you have Medigap, you keep the right to renew it, and insurers cannot drop you because you get sick.

The may provide issue period is one reason to enroll in Medicare Part B as soon as you are may be able to access, even if you are still working and have employer coverage. If you delay Part B enrollment, you may lose your may provide issue rights and face higher costs or denial later.

How Medigap premiums are calculated and what you will pay

Medigap premiums depend on three main things: which plan you choose, which insurance company sells it, and where you live. The same Plan G can cost $100 per month with one company and $200 per month with another, even in the same city. This is why getting quotes from multiple insurers matters.

Insurance companies use three different methods to set Medigap prices. Community-rated plans charge everyone the same premium regardless of age. Issue-age-rated plans charge based on your age when you buy the policy — younger buyers pay less and keep that lower rate for life. Attained-age-rated plans charge based on your current age and go up as you get older. Most plans are attained-age-rated, which means your premium will increase over time.

You will receive a notice each year before your premium renews. If the increase is large, that is the time to shop around — you may find a better rate with a different company. Some people switch insurers every few years to keep costs down, and you can do this without penalty.

Medigap versus Medicare Advantage: which approach makes sense

Medicare Advantage (Part C) is an alternative to Original Medicare plus Medigap. With Advantage, you get all your Medicare coverage through a private insurance company instead of the government. Advantage plans often have lower or zero monthly premiums, but they usually have networks (you must use certain doctors), higher copayments per visit, and annual out-of-pocket limits.

Original Medicare plus Medigap has higher premiums but gives you more freedom. You can see any doctor who accepts Medicare, and there are no networks or referrals. You also have no annual out-of-pocket limit — once your Medigap plan pays, you are done paying for that service.

The choice depends on your health, your doctors, and your budget. If you have a preferred doctor or specialist, check whether they accept Medicare Advantage plans in your area before you decide. If you travel a lot or live part of the year in different states, Original Medicare plus Medigap is usually simpler because coverage follows you everywhere.

How to compare Medigap plans and get quotes

Start by deciding which plan letter fits your budget and health needs. If you want the most comprehensive coverage and can afford it, Plan G is the standard choice. If you want to save money and do not mind some copayments, Plan N is popular. If you are on a tight budget, Plan A or Plan D may work, though you will pay more out of pocket when you use care.

Once you pick a plan, get quotes from at least three insurance companies. You can call insurers directly, use their websites, or contact your State Health Insurance information Program (SHIP), which offers free counseling and can help you compare plans. SHIP is run by your state and has no financial stake in which plan you choose.

When you compare quotes, look at the monthly premium, any waiting periods for pre-existing conditions (though these are rare during may provide issue), and the company's customer service ratings. The National Association of Insurance Commissioners (NAIC) publishes complaint data by company and state, which can help you spot insurers with poor service records.

What happens if you switch plans or insurers

You can switch Medigap plans or insurers at any time, but the timing matters for your wallet. If you switch to a different plan letter (for example, from Plan A to Plan G), the new insurer may impose a waiting period for pre-existing conditions — usually 6 to 12 months. If you switch to the same plan letter with a different company, there is typically no waiting period.

The best time to switch is during the annual open enrollment period for Medicare, which runs from October 15 to December 7 each year. Changes take effect January 1. You can also switch outside this window, but your new coverage may not start until the following month, and you may face waiting periods.

Before you switch, make sure your current doctors and prescriptions are covered under the new plan. Also check whether you will have a gap in coverage — you do not want a day when you have no Medigap protection. Coordinate the timing so your old plan ends and your new plan begins on the same day.

Frequently Asked Questions

Do I have to buy Medigap, or can I just use Original Medicare alone?

You are not required to buy Medigap. You can use Original Medicare by itself and pay deductibles and copayments out of pocket. However, you have no annual limit on what you pay, so a serious illness could cost thousands of dollars. Many people buy Medigap to protect themselves from these large bills.

Can I use Medigap if I have a Medicare Advantage plan?

No. Medigap only works with Original Medicare. If you have Medicare Advantage, you cannot buy Medigap. If you want to switch from Advantage to Original Medicare plus Medigap, you can do so during the annual open enrollment period, and you will have may provide issue rights if you are within your first year of Medicare Part B enrollment.

What if I miss my may provide issue period?

You can still buy Medigap after your may provide issue period ends, but insurers may charge you more, deny you coverage, or exclude pre-existing conditions for 6 to 12 months. Some states offer additional may provide issue periods if you lose employer coverage or move. Contact your State Health Insurance information Program to learn what protections explore where you live.

Do I still pay Medicare premiums if I have Medigap?

Yes. You must keep paying your Part B premium (currently $164.90 per month for most people in 2024, though this varies by income). You also pay your Medigap premium to the private insurance company. If you take prescription drugs, you pay a Part D premium as well. Medigap does not replace these — it supplements them.

Can an insurance company drop me or raise my rates because I got sick?

No. Once you have Medigap, the insurance company cannot drop you or deny renewal because you develop a health condition. They can raise rates, but only if they raise rates for everyone in your state with the same plan. They cannot single you out based on your health.