When it comes to Medicare, you’ve got quite a few decisions to make. If you’ve already decided a Medigap plan is the right choice for you, it’s now time to decide exactly which plan you want. Not to worry, we’ll take you through the three steps you need to take to make that decision.
Of course, the first thing you need to do is to learn how Medigap plans work. These plans are also called Medicare Supplements and are categorized by letters of the alphabet. There are about ten different Medigap plans to choose from: Plans A, B, C, D, F, G, K, L, M, and N. Each plan offers a different amount of coverage.
No matter which plan you choose, Medigap plans all work the same way. They act as your secondary insurance, with Original Medicare (Parts A and B) being your primary. Medigap plans pick up all or some of the costs that Parts A and B would otherwise leave you to pay.
Plan G is probably the most popular option among Medicare Supplements. It picks up every cost leftover from Parts A and B except for the Part B deductible. Another popular choice is Plan N, which offers similar benefits. The biggest difference between Plans G and N is that Plan N requires copays when visiting a doctor’s office or emergency room.
To enroll in a Medicare Supplement plan, you must be enrolled in both Medicare Part A and Part B. In addition, Plans C and F have one more limitation. To enroll in one of those two plans, you must have turned 65 and have a Part B effective date prior to the year 2020. Anyone who enrolled in Medicare in 2020 or after can not choose Plan C or Plan F.
During a six-month period around your 65th birthday, you can choose any Medigap plan you’d like. No health questions will be asked, and pre-existing conditions are not considered. No insurance company can deny your enrollment based on your health. These rules are called guaranteed issue rights. You’ll have these same rights if you delayed Medicare enrollment past the age of 65 but had other creditable coverage in place. Outside of those two situations, you must pass medical underwriting to enroll in a Medigap plan.
Another important thing to understand about Medigap plans is that their coverage is standardized. Each individual letter plan has the same benefits, no matter which insurance company offers the plan. For example, Plan G in Arizona from Company A has the same benefits as Plan G in Nevada from Company B. For this reason, you should always compare premiums from multiple companies.
But how do you know which insurance company to choose? Is the cheapest option always the best option? Not necessarily. After you’ve looked at premiums, there are a handful of other things to consider.
Carriers who have high financial ratings are always preferred over those with lower ratings. AM Best is a company that rates insurance carriers based on their financial stability and their ability to pay claims. Seek carriers who have either A or B ratings from AM Best. This means the company has a stable outlook and should be around well into the future.
You should also consider a company’s reputation and customer service. Are they known for mishandling claims or increasing their rates by large sums each year? If you utilize the help of an independent broker like Local Medicare Specialists, you can learn about a company’s history, including the average percentage they increase premiums each year.
Lastly, you may consider any extra benefits a company offers. Medigap plans do not have all the extra benefits that Medicare Advantage plans do, but some offer things like gym memberships and small over-the-counter stipends. Don’t make your decision based solely on this, but it may help you decide between carriers if you've got it narrowed down to a couple of companies.
You don’t have to call every insurance company to find out all this information. Working with the advisors at Local Medicare Specialists will give you insider knowledge and helpful tips when you’re making these decisions. Call us today and chat with a local agent near you!
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LocalMedicareSpecialists.com is privately owned and operated by LMS Insurance LLC. LocalMedicareSpecialists.com is a non-government resource for those who depend on Medicare, providing Medicare information in a simple and straightforward way.
We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area which are United Healthcare, Aetna, Humana, Cigna, Blue Cross Blue Shield of Arizona, Centene, Devoted, and Scan. Please contact Medicare.gov, 1-800-MEDICARE, or your local State Health Insurance Program to get information on all of your options.