Medigap Policies and Medicare Supplemental Insurance
A Medigap Policy (also called "Medicare Supplement Insurance") is private health insurance that is designed to supplement Original Medicare. This means it helps pay some of the health care costs ("gaps") that Original Medicare doesn't cover (like co-payments, co-insurance, and deductibles).
If you are in Original Medicare and you have a Medigap policy, Medicare will pay its share of the Medicare-approved amounts for covered health care costs. Then your Medigap policy pays its share. (Note: Medicare doesn't pay any of the costs for you to get a Medigap policy.)
A Medigap policy is different than a Medicare Advantage Plan (like an HMO or PPO) because those plans are ways to get Medicare benefits, while a Medigap policy only supplements your Medicare benefits. Every Medigap policy must follow Federal and state laws designed to protect you, and the policy must be clearly identified as "Medicare Supplement Insurance."
Medigap insurance companies in most states can only sell you a "standardized" Medigap policy identified by letters A through N. Each standardized Medigap policy must offer the same basic benefits, no matter which insurance company sells it. Cost is usually the only difference between Medigap policies with the same letter sold by different insurance companies.
In Massachusetts, Minnesota, and Wisconsin, Medigap policies are standardized in a different way. Insurance companies can only sell you a "standardized" Medigap policy. These Medigap policies must all have specific benefits so you can compare them easily. You may be able to choose up to 10 different standardized Medigap policies (Medigap Plans A through N).
Medigap policies must follow Federal and State laws. These laws protect you. A Medigap policy must be clearly identified on the cover as "Medicare Supplement Insurance." Each plan, A through N, has a different set of basic and extra benefits. It's important to compare Medigap policies because costs can vary. The benefits in any Medigap Plan A through N are the same for any insurance company. Each insurance company decides which Medigap policies it wants to sell.
Generally, when you buy a Medigap policy you must have Medicare Part A and Part B. You will have to pay the monthly Medicare Part B premium. In addition, you will have to pay a premium to the Medigap insurance company.
You and your spouse must each buy separate Medigap policies. Your Medigap policy won't cover any health care costs for your spouse.