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Under Medicare, you have options for your health care coverage. Most states provide only two options: “Medicare Advantage Plans” and “Medicare Supplemental (Medigap) Plans.” These plans are not the same. Medicare Advantage plans are sometimes called “replacement” plans. The Medigap plans “supplement” your Original Medicare. You should study each plan and select the one that’s right for you. Below is a chart of the main features of each plan.
Medicare Supplemental or Medigap plans are insurance policies that work with Medicare. You purchase these policies from private insurance companies. Original Medicare acts as your primary coverage, followed by a Medigap plan, and then you pay the rest.
For example, when you incur medical expenses, Medicare reviews the bill and pays its part of the coverage charged by the medical provider.
Next, the remaining bill is sent to your Medigap plan which pays another part of the medical expense (depending on which supplemental plan you select).
Finally, if there are any remaining fees you pay them.
All Medigap plan benefits were standardized by the federal government, which means no matter what insurance company you choose, the plan benefits will be the same. When selecting a private insurance company, compare the premium rates and check the ratings and reputation of the insurance company.
You have one opportunity to sign up for Medicare Supplemental Plans with no medical questions, guaranteed acceptance, and the choice between all ten plan options. This is your “personal enrollment window” and it only happens once.
The enrollment window begins the month you are 65 and enrolled in Medicare Part B and extends for six months. During the six month enrollment period, you will not have to answer any medical questions, you are guaranteed acceptance, AND you may enroll in any of the ten supplemental plans (as long as they are sold in your state).
If you don’t enroll during this time you might have to go through medical underwriting to be approved on a Medicare Supplement plan.
Here are a few situations when you may enroll in Medigap Plans, other than your personal enrollment window at age 65. During these exceptions you may enroll for some of the Medigap Plans. These are called Guaranteed Issue Rights situations. These situations usually result from a change in your insurance coverage.
To summarize, Medicare Advantage is a “replacement” plan which provides the same benefits as Medicare, but it is administered by a private insurance company. Medicare supplemental plans are “supplements” to Original Medicare and there are a variety of plans to choose from. Both options have some prescription drug coverage.