What Is Medigap? What to Know About Medicare Supplement Plans

Medicare Supplement Insurance, or Medigap, is private health insurance that covers “gaps” in Original Medicare coverage. After Medicare pays for its share of covered services, Medigap covers certain out-of-pocket costs, such as copayments, coinsurance and deductibles.

In most states, there are 10 government-standardized Medigap plan types. The plans differ in terms of coverage, premiums and cost-sharing requirements.

Here’s what you need to know about Medicare Supplement Insurance.

How does Medicare Supplement Insurance work?

A Medigap policy can help you cover some or all of these costs for which you’re responsible if you have Medicare Part A and Part B

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• Part A deductible: $1,556 for each benefit period in 2022.

• Part A inpatient hospital stay coinsurance after day 60: Starting at $389 per day in 2022. (The cost increases after day 90.)

• Part A skilled nursing facility coinsurance after day 20: Up to $194.50 per day in 2022. (You’re responsible for all costs after day 100.)

• Part A hospice care coinsurance and copayments: Up to 5% of the Medicare-approved amount for respite care and up to $5 for each prescription drug.

• Part B deductible: $233 in 2022. (Note: Since 2020, new Medicare members can’t buy any plan that covers the Part B deductible, although existing members may own older plans that do.)

• Part B coinsurance: After the Part B deductible, up to 20% of the Medicare-approved amount for most services and durable medical equipment.

• Part B excess charges, if a provider is permitted to charge more than Medicare’s approved amount and does so.

Without a Medigap policy, you're liable for all of those expenses out of pocket.

Medicare Supplement Insurance can be a useful means to manage your health care costs if you have Original Medicare. (Medigap plans don’t work with Medicare Advantage.) Consider your finances, expected health care expenses, risk tolerance and the Medigap plans available where you live to decide whether Medigap is right for you.

What do Medigap plans cover?

Medigap plans cover certain out-of-pocket health care costs after Medicare Part A or Medicare Part B has paid its share.

Here’s what’s covered by Medigap Plan G, the most comprehensive Medicare Supplement Insurance available to new Medicare members, according to Medicare.gov

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• Part A coinsurance and hospital costs up to an additional 365 days after Medicare benefits are used up.

• Part A deductible.

• Part A hospice care coinsurance or copayment.

• Part B coinsurance or copayment.

• Part B excess charges (if a provider is permitted to charge more than Medicare’s approved amount and does so).

• Blood transfusion (first three pints).

• Skilled nursing facility care coinsurance.

• Medically necessary emergency health care service for the first 60 days when traveling outside the U.S. Deductibles and limitations apply.

There are 10 standardized Medigap plans with varying levels of coverage and cost-sharing, but only eight of the 10 plans are available for purchase by new Medicare members.

New Medicare enrollees are no longer allowed to buy plans that pay for the Medicare Part B deductible. That means if you become eligible for Medicare for the first time after Jan. 1, 2020, you can’t buy Medigap Plan C or Plan F, but the other eight plans are available.

Here are all 10 standardized plans:

(Massachusetts, Minnesota and Wisconsin use their own Medigap plan standards, which differ from the 10-plan standardization system used in the majority of the country.)

What Medigap plans don’t cover

Medigap plans sold to new Medicare members do not cover the following:

• Part B deductible. (Since 2020, new Medicare members can’t buy any plan that covers the Part B deductible, although existing members may have older plans that do.)

• Prescription drugs. (If you have Original Medicare, you can enroll in a Medicare Part D plan for prescription drug coverage. Most Medicare Advantage plans include Part D coverage.)

• Long-term care, like the non-skilled care you get in a nursing home.

• Dental care.

• Vision care.

• Private-duty nursing.

How much does Medicare Supplement Insurance cost?

What you’ll pay for Medigap depends on the plan type and health insurer, as well as factors that can include your age, sex, location, tobacco use and health information.

Premiums for a 65-year-old with the least-expensive plans might be as low as $30-$40 per month. For older beneficiaries and plans with greater coverage, premiums can cost hundreds of dollars per month.

In general, high-deductible plans and plans with less coverage, like Plan K and Plan L, have lower premiums. A plan with more comprehensive coverage, such as Plan G, tends to have higher premiums.

Some Medigap plans have other costs in addition to monthly premiums. Here are a few examples of other costs you might pay with certain plans:

• Medigap Plan N has copays for some office and emergency room visits.

• Medigap Plan K and Plan L require you to pay out of pocket for 50% or 25% of most covered services, respectively.

• A high-deductible version of Medigap Plan G requires you to meet a deductible of $2,490 in 2022 before benefits kick in. (High-deductible Medigap Plan F is also available for beneficiaries who qualify for the standard version of Plan F.)

When is the best time to sign up for Medicare Supplement Insurance?

Your Medigap open enrollment period, which starts the first month you have Medicare Part B and are 65 years of age or older, is the easiest and least expensive time to enroll in a Medigap plan. The period lasts for six months, during which companies can’t factor your health or medical history into pricing or coverage decisions.

After your Medigap open enrollment period ends, it never happens again, and insurers can charge more or deny coverage for a new plan due to your health status or medical history.

In some states, insurance companies sell Medigap plans to those under 65 who are living with a disability and are eligible for Medicare. You can find more information at your local State Health Insurance Assistance Program, or SHIP.

Can I switch from Medicare Advantage to Medigap?

There are several opportunities to switch from a Medicare Advantage plan to Original Medicare with a Medigap policy.

Switch to Medigap when you lose Medicare Advantage coverage

In some cases, you have a “guaranteed issue right” to switch to Medigap, which means that insurers must sell you a Medigap policy and can’t charge more because of your health history or medical conditions.

Here are some situations when you have a guaranteed issue right to switch from Medicare Advantage to Medigap

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• Your Medicare Advantage plan is leaving Medicare.

• Your Medicare Advantage plan stops covering your area.

• You move out of your Medicare Advantage plan’s service area.

• The Medicare Advantage plan has misled you or otherwise not followed the rules.

When you have a guaranteed issue right because of any of the circumstances above, you can buy Medigap Plan A, B, D, G, K or L, plus Plan C or Plan F if you qualify. (Medigap Plan M and Plan N aren’t included in the federal law that sets up guaranteed issue rights

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Switch to Medigap after trying Medicare Advantage

You also have a “trial right” to go back to Original Medicare and a Medigap policy within a certain period after you try Medicare Advantage. Like a guaranteed issue right, a trial right means that insurers can’t refuse to sell you a policy or charge you more because of your health or medical history.

Joined Medicare Advantage at age 65

If you joined Medicare Advantage when you turned 65 and first became eligible for Medicare Part A, and then you decide to switch to Original Medicare within the first year, you can buy any Medigap policy offered by any insurer in your state. (You can buy Plan C or Plan F only if you qualify.)

Joined Medicare Advantage after age 65

If you didn’t join a Medicare Advantage plan right when you turned 65, you still have a limited trial right. If you had a Medigap policy, dropped it to join a Medicare Advantage plan, and then decide you want to switch back to Original Medicare within the first year, here’s what you have the right to buy:

Switch from Medicare Advantage to Medigap during open enrollment

You can still switch from Medicare Advantage to Original Medicare with Medigap when you don’t have guaranteed issue or trial rights. However, without those rights, insurers can charge you more or deny coverage based on your health or medical history.

There are two periods during the year when you can switch from Medicare Advantage to Original Medicare with a Medigap plan

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• Medicare open enrollment runs from Oct. 15 to Dec. 7 each year. During this period, you can switch from Medicare Advantage to Original Medicare or vice versa and join, switch or leave Medicare Advantage plans or Medicare prescription drug plans (Part D).

• Medicare Advantage open enrollment runs from Jan. 1 to March 31 each year. This is a more limited open enrollment period that offers a chance to switch or drop a Medicare Advantage plan that isn’t working for you.

If you switch from Medicare Advantage back to Original Medicare during either open enrollment period, you can buy a Medigap policy to accompany your Part A and Part B coverage.

Some states have more or different rights and regulations

The guaranteed issue rights, trial rights and open enrollment periods described above come from federal law, but your state might provide additional rights through state law. Check with your state insurance department or State Health Insurance Assistance Program for information and resources specific to your location.

The parts of Medicare

Read more about the different parts of Medicare and what they cover.

• Medicare Part A (hospital insurance).

• Medicare Part B (medical insurance).

• Medicare Part C (Medicare Advantage).

• Medicare Part D (prescription drug plan).

• Medicare Supplement Insurance (Medigap).