Medicare supplement insurance plans are designed to cover the 20% of expenses that Medicare Part B does not cover.
It is a separate insurance policy, outside of the standard coverage that you receive from Medicare Part A and Medicare Part B.
Let me walk you through a basic example to show you how these policies work.
When you first signed up for Medicare, you were enrolling in Medicare Part A, which covers hospital stays and for which there is currently no premium [unless you are well off] and Medicare Part B, which covers doctor’s visits and for which there is currently a monthly premium of $99.90 [in 2012].
Video Overview of Medicare Supplement Insurance Plans
This Part B premium pays for 80% of the costs of your doctor’s visits, plus 80% of what is defined as “Durable Medical Equipment”, which can include everything from prosthetic limbs to oxygen tanks.
You do need, however, to check with Medicare so you know exactly what is covered. To find out, there is an interactive guide located on the Medicare website.
You are responsible for paying the remaining 20% of the costs of the doctor’s visits plus 20% of the costs of any Durable Medical Equipment.
This is where supplemental Medicare insurance plans come into play.
The Medicare supplement plans, which require a premium to a private insurance in addition to your Medicare Part B premium, will cover the remaining 20% of those bills that Medicare Part B does not cover.
So now that you have an understanding of what Medicare supplement insurance plans are, how do you go about picking the right one for you and the right insurance company to work with?
First of all, for an insurance company to be approved to sell any of the Medicare supplement insurance plans …and I will go through your options below…they have to agree to sell a “standardized policy”.
This means, for example, if you choose to purchase “Plan F”, the “Plan F” from AARP through United Health Care is identical in its terms, conditions and coverage’s to any other insurance company’s “Plan F” Medicare supplement insurance plans.
However, because each company has its own underwriting guidelines this means that the costs of each policy can vary from company-to-company.
This means that when it comes to comparing Medicare Supplement plans, once you pick the Plan you want the next step is to find the cheapest insurance company for that Plan.
The way to do that is simple. You can choose to call companies and find out their rates, or you can go to the Medicare supplement insurance plans interactive website.
It will take you through a series of questions to assess which plans are available in your area. Once you have made the decision which plan is for you [Plan A through Plan N], all you need to do is pick the cheapest.
Picking The Right Supplemental Medicare Insurance
So, the big question when assessing Medicare supplement insurance plans then becomes how you go about picking the right Plan for you.
In order to do this, I need to give you an understanding as to what these policies cover and what they did not cover.
First, what they do not cover…
- Long-term care in a nursing home [you need a separate long-term care insurance policy for that]
- Vision or dental care [including dentures]
- Hearing aids
Now for what they do cover…look at the file below…
You can click on the file on enlarge it.
This comes from the “Choosing A Medigap Policy 2012” and states the coverage’s that each of the Medicare Supplement Plans offers, regardless of which insurance company you purchase the Plan from.
So which one should you choose? That is totally up to you and is dependent upon your current medical and financial situation.
If you are in good health with limited resources, then Plan A would be most economical…and if you are seeking the most comprehensive coverage, including foreign emergency travel care, then Plan F is the answer for you.
Another area to look at is the last of the Medicare benefits listed on the chart…Foreign Emergency Travel. If you do not plan on traveling outside of the US, then there is no reason to have this benefit.
As a result, you don’t need this and can save money by choosing one of the Plans that does not offer this service.
And finally, the last bit of advice that I could give you when choosing one of the Medicare supplement insurance plans is to check with your local Office of the Aging.
Sometimes, and this is not always the case, there is benefit counseling available at this office, where you can sit with a volunteer who will answer your questions regarding the type of policy that may be best for you.
I would definitely encourage you to call your local Office of the Aging to see if this available in your area.
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