MEDIGAP – HOW IS IT CHARGED?

Medicare Supplement Plans are policies offered by insurance companies to fill in the gaps left by the Original Medicare. These companies charge premium based on certain parameters and based on the kind of policy you opt for.

 

There are 10 different plans starting from Plan A till Plan N. Some of the benefits are common to all policies while there are some extra benefits as you go from A to N. The policies of each Plan will be the same for all the companies, but the premiums may differ.

 

WHAT ARE THE BASIS OF PREMIUM CHARGES

 

As the Medicare Supplement Plans are sold by private insurance companies they can set their premiums differently but based on the following three systems of rating.

 

Community Rated Premiums – All beneficiaries are charged the same premium regardless of age. Which means that the premiums won’t increase with age. But it may increase due to inflation.

 

Issue-Age Rated Premiums – This premium is charged based on your age when you purchase the first Medigap policy but will not increase with your age. This premium will also be revised based on the inflation. The premium is obviously lower when the policy is taken at a young age.

 

Attained-Age Rated Premium – This premium is also charge as per your age when you take the policy, but this will keep increasing as you age. This premium is also lower for younger people.

 

It is worth remembering that even if we have purchased Medicare Supplement Plans we should continue to pay the premium for the Original Medicare.

 

People who have put in 10 years of service while paying Medicare taxes need not pay premium for Medicare Part A. But all beneficiaries pay for Part B.

 

WHEN TO BUY MEDIGAP

 

The best time to buy Medicare Supplement Plans is the Medigap Open Enrolment Period. This is the time when you have enrolled in Medicare Part B and you have completed 65 years of age. During this period, you get certain benefits while buying Medicare Supplement Plans. You need not pay for any health condition. You can buy a Medigap policy without undergoing a medical underwriting.

 

If you miss the Medigap Open Enrolment Period, you will pay more premium for the policy. Whatever the premiums, it is wise to check all the different plans and check what is best suited for you and then go for that. Some companies offer a chance to migrate from one policy to other later on also.

 

 

HEALTH IS WEALTH

Every year new people become eligible for Medicare as they cross the age of 65. Many of them are nor aware of all the conditions and clauses in Medicare. They are also not aware of the many Medicare Supplement Plans available.

 

Even those who are aware of the Medicare Supplement Plans or Medigaps as they are called, they never thought they will need them.

 

Through this article, we wish to analyze why people need a Medigap policy and compare the different plans available.

 

Medicare Supplement Plans are helpful where the Original Medicare falls short. In cases of extended stays in hospital, the Original Medicare pays only for a limited number of days. It also won’t take care of your health when you are out of the US.

 

In both Medicare Part A and Part B, you have to pay annual deductibles, coinsurance, and copayments. Most of the Medigap policies take care of these.

 

Before we compare the various Medicare Supplement Plans, let us first see some of the fundamental facts.

 

We need to understand that all the companies have the same basic benefits that they offer in each plan. Which means Plan A of one company will have the same benefits as Plan A of another company. This is true except in Massachusetts, Minnesota, and Wisconsin which have their own state rules for Medigap policies.

 

As of 2018, there are 10 plans starting from Plan A and ending in Plan N.

 

Plan A has the basic facilities offered in other plans. But as you go down the letters you will find additional benefits being offered in some plans.

 

All the plans will cover additional days stay at the hospital over and above the Medicare limit, up to 365 days. All the plans also cover coinsurance and copayments which are required under Medicare Part B.

 

When you need blood, the first three pints of blood are not covered under Medicare. Only the subsequent quantities are covered under Medicare Part A. All Medicare Supplement Plans will pay for these first 3 pints of blood.

 

When it comes to hospice care Medicare Part A has a limit to which it will pay for inpatient respite care and outpatient drugs. All plans will pay for whatever is not paid by the Medicare Part A.

 

These are certain basic facilities that the Medical Supplement Plans provide for. This compels everyone to go for it.