As you may know, Original Medicare (Parts A and B) covers approximately 80 percent of the cost of most services. But what about the remaining 20 percent, or even the other out-of-pocket costs like deductibles or inpatient copayments? You may want to obtain a Medicare Supplement Insurance (also known as Medigap) policy as a companion to your Medicare coverage. But how to know which one? My first recommendation is to obtain a copy of the Consumer Guide to Medicare Supplement Insurance (Medigap), which is published annually by the State of Alaska. This is available online, and may also be obtained by contacting the Medicare Information Office. We would be happy to provide a printed or electronic copy.
Medigap coverage
Out of pocket costs of health insurance for individuals enrolled into Medicare may be paid for by policies that offer standardized benefits to work with Original Medicare. This is known as Medigap coverage, which are plans sold by private insurance companies. If you have a Medigap, then this plan will pay part or all of certain remaining costs after Original Medicare pays first. Medigaps are designed to cover outstanding deductibles, coinsurance and copayments. If you have a Medigap, you will generally not have any out-of-pocket costs for an inpatient hospital stay or outpatient doctors’ visits if your providers accept Medicare assignment.
An individual may choose any one of up to ten different Medigap policies (or plans) named alphabetically: A, B, C, D, F, G, K, L, M and N. Two of these plans (C and F) are only available if the individual first enrolled into Medicare before 2020. Other letters (such as E, H, I or J) represent plans which are no longer able to be newly issued to Medicare enrollees. Each policy offers a different set of standardized benefits, meaning that policies with the same letter offer the same benefits. However, premiums vary from company to company.
Protected Enrollment Periods
Here in Alaska, there are two different specified times when someone has guaranteed issue rights, which means that you have the right to buy a plan without being denied coverage or charged higher premiums due to your health status. The first period starts when you are age 65 (or older) and enroll in Medicare Part A and B for the first time, it ends six months later. If you apply for a policy after this period ends, companies may refuse to provide you coverage because of health reasons. If you are under 65 and have Medicare Part A and B coverage because of disability (per the Social Security Administration) or end-stage renal disease, you will not be eligible for this period until you become 65 years old.
The second period begins when you lose or end certain kinds of health coverage; however, there are only 63 days under which you may exercise this guaranteed issue right and apply for a Medigap policy to supplement your Medicare coverage. The Consumer Guide mentioned previously details many of these examples in Appendix A. The variations and details are too numerous to list fully in this article. If you have questions, please contact our office to discuss with any of our certified Medicare counselors.
Purchasing a Medigap policy
Fifteen different insurance companies offer Medigap policies to supplement your Medicare. In addition, the Alaska Comprehensive Health Insurance Association (ACHIA) exists to offer coverage to Alaskans who otherwise are unable to qualify for a policy.
When picking the plan that may be right for you, assess your health care needs now and in the future. Compare premiums both for your current age and for someone 10 to 15 years older to look at changes over time. The State of Alaska-published Consumer Guide to Medicare Supplement Insurance (Medigap) is a fantastic resource with an overview, comparisons between the different plans, contact information for each of the insurance issuers, and monthly premium estimates.
None of us have a crystal ball nor a time machine; we know that you want to make the best decision you can, so give our office a call to help.
For any Medicare related questions, contact the State of Alaska Medicare Information Office at 800-478-6065 or 907-269-3680; our office is also known as the State Health Insurance Assistance Program (SHIP), the Senior Medicare Patrol (SMP), and the Medicare Improvements for Patients and Providers Act (MIPPA) program. If you are part of an agency or organization that assists seniors with medical resources, consider networking with the Medicare Information Office. Call us to inquire about our new Ambassador program.
Sean McPhilamy is a volunteer and Certified Medicare Counselor for the Alaska Medicare Information Office.
