Medicare Supplemental Insurance Guide

As you may know, Medicare insurance will cover up to 80% of certain types of medical treatments, doctors office visits, hospitalizations, medical equipment and more. The exact coverage will depend on if you have just Medicare Part A or if you also have the optional Medicare Part B Coverage.

Even with this coverage, many people are left to pay significant out-of-pocket costs to cover the remaining 20 percent of the price of their services which is also referred to as the co-payment amount. Many people simply cannot afford to pay the co-payment in cash so they make use of one of the many Medicare supplemental insurance policies available on the market. A policy may be managed by one of many companies, but all fall under the guidelines of Medicare.

There are 12 existing Medicare supplemental plans, also referred to as Medigap. Each one provides different types of coverage although all must cover basic specific Medicare benefits.

The various Medigap plans fall under a label from Medicare Supplemental Plan A through L (Plans M & N will be added in June 2010). Plans will differ by the monthly premium and the amount of out-of-pocket expenses required by the user.

There’s also another option known as Medicare SELECT which is a Medicare supplement policy that is less expensive than other plans. The only downside to Medicare SELECT is that you are restricted to certain physicians and hospitals for your health care needs. You will want to contact the state insurance department to determine if the Medicare SELECT option is available and fits your individual needs.

Some people choose to use a Medicare Advantage Plan, which is an HMO for Medicare users. If you fall into this category you do not need a Medicare supplemental insurance policy.

A Quick Overview of Medicare Supplemental Insurance Plans

Medicare Supplemental Insurance is designed to help cover some of the medical costs not covered by the Original Medicare Plan and is comprised of 12 standard Medicare supplemental insurance plans.  Certain basic coverage is included in all Medicare Supplemental Insurance Plans.

Plans are labeled “A” through “L” and offer different benefits, at varying prices, that fill particular “gaps” in regular Medicare coverage.   Medicare Supplemental Insurance Plans K and L are similar to Plans A through J but trade off lower monthly premiums for higher out of pocket costs.

As of 2009, some insurance carriers will offer Medicare Supplemental Insurance Plans F and J which feature a $2,000 deductible which is what you must pay out of pocket before the plan covers any costs.

This deductible could increase yearly.  Though the higher deductible allows for lower monthly premiums, the total cost to you in the event of illness will be higher.

NOTE: Medicare SELECT is a Medicare Supplemental Insurance Plan that is offered in addition to the standard A-L policies and can have a lower cost.  You will be limited to certain hospitals and Medicare approved doctors.  Your state insurance department will be able to tell you if Medicare SELECT policies are offered in your state.

Those enrolled in a Medicare Health Maintenance Organization (HMO) or other Medicare Advantage Plans do not need a Medicare Supplemental Insurance policy.

Medicare Supplemental Insurance Standard Plans will differ for residents of Massachusetts, Minnesota and Wisconsin.

Basic Medical Coverage for Plans A-J:

• Medicare Part A coinsurance plus coverage for 1 additional year after Medicare benefits terminate.
• Medicare Part B coinsurance (generally 20 percent of Medicare-approved expenses), or copayments for hospital outpatient services
• First three pints of blood each year

What is Covered by Plan K?

Medicare Part A coinsurance plus coverage for 1 additional year after Medicare benefits terminate.
• 50% of hospice cost-sharing
• 50% for the first three pints of blood each year
• 50% Medicare Part B coinsurance, except 100% coinsurance for Part B preventive services

What is Covered by Plan L?

Medicare Part A coinsurance plus coverage for 1 additional year after Medicare benefits end
• 75% of hospice cost-sharing
• 75% for the first three pints of blood each year
• 75% Medicare Part B coinsurance, except 100% coinsurance for Part B preventive services

Medicare Part A Hospital Deductible

This is covered by Medigap Plans B-J: $1,068 in 2009 for each benefit period for hospital services

What Else is Covered by Plan K?

50% of the $1,068 Part A hospital deductible

What More is Covered by Plan L?

75% of the $1,068 Part A hospital deductible

What about Skilled Nursing-Home Costs?

Skilled Nursing-Home are Covered by Plans C-J as follows:
Your cost ($133.50 in 2009) for days 21 through 100 in a skilled nursing facility.

Skilled Nursing-Home are Covered by Plan K as follows:
50% of $133.50 for days 21 through 100 in a skilled nursing facility.

Skilled Nursing-Home  are Covered by Plan L as follows:
75% of $133.50 for days 21 through 100 in a skilled nursing facility.

What About Your Medicare Part B Deductible?

The Part B Deductible is Covered by Plans C, F, J:
Yearly deductible for doctor services ($135 in 2009)

What About Medicare Part B Excess Charges?

Medicare Part B Excess Charges are Covered by Plans F (100%), G (80%), I (100%), J (100%):
The difference between your doctor’s charges and the Medicare-approved amount, if your doctor does not accept assignment.

What About Foreign Travel Emergency?

Foreign Travel Emergency  is Covered by Plans C-J:
• 80% of the cost of emergency care outside the United States
• Maximum benefit of $50,000 in your lifetime
• Patient pays a yearly deductible of $250

What About At-Home Recovery?

At-Home Recovery is Covered by Plans D, G, I, J:
• Help for daily living activities, such as dressing and bathing, if already receiving skilled home care covered by Medicare
• Assistance for up to eight weeks after you no longer need skilled care
• Up to $40 per visit, seven visits per week, or a total of $1,600 per year

What About Non-Medicare-Covered Preventive Services?

Non-Medicare-Covered Preventive Services are Covered by Plans E, J:
Ma $120 per year for non-Medicare-covered preventive services as ordered by your physician.

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