If you are 65 years old, or about to turn 65, you know all too well the volume of letters and information about retirement, social security, and Medicare that is out there. The opportunities available to you are engineered to provide you with a security blanket after you have retired from work.
When it comes to your healthcare after retirement, Medicare will cover most of your medical costs, so why is there a need for a Medicare Supplement Plan, also known as a Medigap Plan?
What are Medigap Plans?
Traditional Medicare Parts A and B don't cover all costs associated with your medical care. There is a 20-percent gap between what Medicare covers and your responsibility. Medigap plans bridge that gap to provide you with peace of mind when it comes to your healthcare costs.
Medigap pays for some of the medical costs that Medicare doesn't cover, such as the following:
- Healthcare that happens outside of the U.S.
What Medigap Plans are available?
There are 10 standardized Medigap Plans, which are displayed with their coverage below. A standardized Medigap Plan means that the plan coverage is exactly the same across states and between companies. In other words, a Medigap Plan A from one carrier will have the same coverage as a Medigap Plan A from any other insurance carrier. The only differences are the premium amount and the customer service you receive from the insurance company.
Medigap plan designations are not connected to Medicare part designations. In other words, Medigap Plan A has nothing to do with Medicare Part A.
Medigap Plans and Coverage
Which Medigap Plan should you choose?
- Plan G: Medigap Plan G covers the full costs after Medicare, except for the $185 annual Medicare Part B deductible. Plan G premiums are typically about $40 less per month than Plan F. This means that even with the $185 deductible, your annual costs will be about $300 less with Plan G, making this plan a great option for seniors.
- Plan F: Medigap Plan F is best for those who want the peace of mind that comes from knowing everything is covered and don't want any out-of-pocket responsibility. Plan F has the highest monthly premium, and with that premium comes the richest coverage. You avoid the $185 per year deductible of Plan G, but pay about $40 more per month in premium.