Medigap Insurance by Danielle Kunkle
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Medigap plans, also
called Medicare supplements, have been around almost since President Lyndon
Johnson signed Medicare into law. Many doctors and insurance agents refer to
these as traditional Medicare plans, as opposed to the newer options we see on
today's market, which are called Medicare Advantage and work very
differently.
Purchasing a
traditional Medigap plan has many advantages. Just to name a
few:
They give you the
freedom to access any Medicare provider in the nation - no
networks!
They are designed to
pick up your share of your medical costs: the deductibles and co-insurance that
Medicare's share does not cover, so they substantially limit your financial
exposure.
There are 12
standardized plans to choose from, along with 2 high deductible plan options -
each of a different letter (A- L). Each plan has a different set of benefits,
allowing you to choose which set of benefits best fits your
needs.
The reason that the
federal government standardized Medigap plans in the early 1990's was to
eliminate confusion, so that Medicare beneficiaries can now shop among carriers
for the best rates, without worrying that the benefits will be different among
carriers.
Perhaps the best
time to purchase a Medigap plan is when you first turn 65 and/or activate your
Part B Medicare coverage. You have a 6-month window after your Part B becomes
effective to choose any plan you like without having to answer ANY medical
questions. No carrier can turn you down for health reasons during this one-time
6-month period. To shop rates, you should locate an INDEPENDENT agent who works
with many different carriers so that you can compare costs and also gain that
agent's perspective on rate trends and financial stability of various carriers.
If you buy directly from a carrier itself, then you will still pay exactly the
same price for the policy, but you will have given up your right to an agent to
represent you and assist you later on should any claims issues arise, and be
stuck calling a 1-800 number when you need help. Look for agents who represent
numerous carriers, instead of directly employed agents (called captive agents)
who will usually only be able to represent products from the one carrier by
whom they are employed.
Since 2006, Medigap plans do not include drug coverage.
Instead, people who choose to keep their original Medicare Parts A&B and
supplement it with a Medigap insurance plan, will add a separate, inexpensive
Part D drug card which they will use at the pharmacy. More on Part D in next
month's newsletter! |