In the American health care system, Medicare is a social insurance program that provides health insurance coverage to people over 65, and others who have a congenital physical disability. However, Medicare does not pay for all the costs associated with getting health services and supplies – there are copayments, deductibles, and coinsurance costs that are required to be paid by the patient or the insurance taker. Supplement insurance for Medicare is the type of insurance policy that pays for just such costs, the ones that are not covered by Medicare. Because they fill in the gaps between the cost of health care, and the total amount reimbursed by Medicare, supplemental health insurance is also called Medigap.
Benefits of Medicare Supplemental Insurance
There are many associated costs to using Medicare, including copayments, deductibles, and coinsurance costs. Medicare will also not cover many different types of costs associated with a visit to a hospital – these include travel, lodging, counseling, home recovery, and outpatient services, among others. Supplemental insurance plans will pay for these costs and more. It should be noted that supplement insurance is just that – a supplement to your Medicare insurance policy. It cannot be taken just by itself. However, it is a very useful policy to have because the extra costs associated with Medicare itself can come to thousands of dollars.
More specifically, Medigap insurance complements the coverage provided by Medicare Parts A and B. This includes hospitalization costs and payment of co-insurance. Medigap plans also provide insurance coverage for foreign travel, something that is not part of Medicare. It also covers the deductibles for both Plan A and B Medicare. For reference, Medicare Plan A covers in-patient hospital services, and Medicare Plan B covers medical expenses, outpatient services, and laboratory services.
Types of Medicare Supplement Insurance
Though Medigap is provided by private insurers, Medigap plans have been standardized by Centers for Medicare and Medicaid Services (CMS), which is a federal body. There are 10 plans named from A to N, with plans E, H, I, and J having been discontinued after May 31, 2010.
Aside from Medigap, there are other supplemental insurance policies that add benefits for other illnesses and diseases, which may not be covered by a regular plan. For example, if your normal insurance plan does not cover for critical insurance, you can take supplement insurance that cover for it. Other such plans include plans that cover, hospital indemnity or hospital confinement insurance and accidental death policies.
Selecting the right Medigap insurance plan will be one of the most important decisions you will make regarding your money and health, so you are advised to do the right research before you make your decision.