When US residents reach 65, they become eligible for Medicare, but there are gaps in coverage that may leave them paying more out-of-pocket than they can afford. That's why many seniors apply for Medicare supplement insurance. Also known as Medigap plans, these Medicare supplemental plans often cover copays, coinsurance payments, and deductibles -- medical expenses that can leave people falling between the cracks. The most popular and best Medigap policies are plans C and F; often referred to as "Cadillac" options, Medigap plans C and F offer coverage for every doctor and hospital visit. The type of Medicare supplement plan that's needed will depend on budget and on what type of coverage is in place. Each part has its own coverage requirements, and they all have coverage gaps. That's why people use the word "Medigap" to refer to these types of insurance plans. They address the common coverage gaps that exist in Medicare Parts A and B.
Many private insurance companies offer Medigap coverage. Five of the best plans are offered by AARP, Cigna, Mutual of Omaha, Transamerica and State Farm. AARP's Medicare supplemental insurance is actually administered by UnitedHeathcare. These companies have been in the health insurance business for decades, have locations all over the country and can offer some of the market's most competitive rates.
Monthly premiums for Medicare supplemental insurance vary from state to state. Also, each type of plan varies in cost. For example, the average monthly premium for Plan A is $310, and for Plan L it's $212. The Cadillac plans of C and F cost $414 and $321 on average, respectively. Senior dental plans will range from $21 to $43 a month, and senior vision plans will be anywhere from $10 to $18 a month.
Medigap plans C and F are the only two plans that cover the Medicare Part B deductible, which amounts to $183 per year. Also, Plan F is just one of two plans that covers the Part B excess charge. These are the best and most comprehensive Medicare supplemental plans.
Anyone who is covered under Medicare Parts A and B can apply for a Medicare supplement plan, and they can get coverage during the open enrollment period. This will either be within a six-month period after they have turned 65 or have enrolled in Medicare Part B. They will be able to sign up for any Medicare supplement plan they want during this period, and are guaranteed acceptance.
Medicare supplement plans address any gaps in Medicare Parts A and B, which includes any deductibles and coinsurance payments that the insured must pay out of pocket. Medicare Part A (which covers hospitalization) may only cover a certain number of days, and Medicare Part B will have a set deductible that must be met before the coverage will kick in. The specific type of coverage will depend on the plan.
Medicare supplement plans are meant specifically for Parts A and B so they don't include prescription drug coverage. That type of coverage is included in Medicare Part D, and seniors can choose among different plans. There are several companies that offer them, and they will vary from state to state.
Medicare supplement plans will follow people no matter what part of the country they travel or move to, but their rates will change depending on the state in which they live. Most plans will cover domestic travel. The only plans that don't are Select Plans, which is why they're rarely purchased.
There are only six plans that cover foreign travel. If someone spends a lot of time abroad, there are other health insurance plans that can offer better coverage, and many of them are affordable.
There are 10 total Medigap insurance plans: These are designated as A, B, C, D, F, G, K, L, M, and N. Not all insurers in all states offer the full range of plans. However, federal law requires that any company that sells Medigap plans must provide either Plan C or Plan F, which are the most comprehensive plans.
Several Medigap plans cover medical costs for seniors while traveling abroad. These include plans C, D, F, G, M and N, which all cover up to 80 percent of costs.