You may need to purchase health insurance to supplement your Original Medicare coverage (Parts A and B), because Medicare generally won’t cover all of your medical expenses. Usually, you’ll have to satisfy a deductible before Medicare pays anything, and you’ll also pay a co-payment when you visit a physician or are admitted to the hospital.
Fortunately, you can buy supplemental insurance from private companies that will help you plug the gaps in your Medicare coverage. You’ll pay the private insurance company a monthly premium in addition to the monthly Part B premium you pay to Medicare. These Medigap plans are regulated and standardized by the federal government. There are 8 different plans that can be sold to individuals new to Medicare, although your state may not offer all of them (and three states, Massachusetts, Minnesota, and Wisconsin, have their own standardized plans). These plans offer different levels of coverage. You can compare plans at the Health Care Financing Administration’s website, medicare.gov.
Whatever plan you choose, you have the right to cancel it within a certain amount of time (usually 30 days, sometimes longer) if you don’t like the policy after you buy it. In addition, the policy must be guaranteed renewable and cannot duplicate existing coverage, including Medicare.
Another way to supplement Medicare is to keep in effect any employer-sponsored health-care insurance you have. Depending on the type of coverage you have, and whether you’re retired, one plan will pay your health-care costs first, and the other plan will cover some or all of the remaining costs. To make sure claims are properly paid, let your health provider know when you have health insurance in addition to Medicare.
Note that if you have a Medicare Advantage (Part C) plan, you don’t need a Medigap plan, and it’s illegal for anyone to sell you one unless you’re in the process of switching back to Original Medicare.
Michael J. Brown, AIF® Senior VP / Branch Manager, Janney Montgomery Scott, 401 New Road, Suite 200, Linwood, NJ 08221, 609-601-2512, michaelbrown@janney.com.
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