Comparing plans

Medicare Supplement Insurance Policies

Christian Worstell

by Christian Worstell | Published February 18, 2021 | Reviewed by John Krahnert

Medicare Supplement Insurance policies, also known as Medigap, are insurance plans designed to supplement Medicare benefits by helping to provide coverage for out-of-pocket expenses that many Medicare recipients face.

What Medicare Supplement Plans Cover

Medicare presents a number of situations in which patients may be faced with paying out of their own pocket for certain services and products. Medicare Supplement Insurance focuses on nine such areas. Below is a list of the nine benefit areas that Medigap plans may help cover (all costs noted are for 2021).

  1. Medicare Part A coinsurance and hospital costs
    Only the first 60 days of an inpatient hospital stay are covered by Part A of Medicare. For days 61-90, patients are required to make a $371 coinsurance payment for each day. Days 91 and beyond require a $742 daily coinsurance payment for each “lifetime reserve day," which patients are given 60 of. After those are exhausted, patients are responsible for all costs.

  2. Medicare Part B coinsurance or copayments
    Part B of Medicare requires patients to pay 20 percent of the Medicare-approved amount for most services once the Part B annual deductible has been met.

  3. First three pints of necessary blood
    Medicare does not provide coverage for the cost of the first three pints of blood needed for a transfusion.

  4. Medicare Part A hospice care coinsurance or copayments
    Medicare Part A requires small copayments (no more than $5) for prescription drugs and other products designed for pain relief and symptom control during hospice care. Patients may also be responsible for a five percent coinsurance payment for inpatient respite care.

  5. Skilled nursing facility care coinsurance
    The first 20 days of an inpatient stay at a skilled nursing facility are covered in full by Medicare Part A. But days 21-100 require a coinsurance payment of $185.50 per day and after 100 days, the patient assumes responsibility for all costs.

  6. Medicare Part A deductible
    Part A of Medicare requires patients to meet a deductible of $1,484 before coverage begins. This deductible is required for each benefit period, which begins the day a patient is admitted to the hospital as an inpatient and resets again when the patient has not been an inpatient for 60 consecutive days.

  7. Part B deductible
    Medicare Part B requires an annual deductible of $203 to be met before coverage benefits begin.

  8. Part B excess charges
    If a doctor or other health care provider does not accept Medicare, they may still treat Medicare patients but will be allowed to charge up to 15 percent more than providers that do accept Medicare. These are called excess charges, and patients that visit these providers may be responsible for these extra charges.

  9. Foreign travel emergency care
    In most situations, Medicare does not provider coverage for emergency care received outside of the U.S.

There are 10 Medigap plans available (not every Medigap plan may be available in every state) and each plan provides its own unique combination of basic benefits. The table below shows how different Medigap plans (which are each identified by a letter) provides coverage for Medicare’s out-of-pocket expenses.

You can use the 2020 Medigap plan chart below to compare the benefits that are offered by each type of plan. Use the scroll bar at the bottom of the chart to view all plans and information.

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Medicare Supplement Benefits

Part A coinsurance and hospital coverage

Part B coinsurance or copayment

Part A hospice care coinsurance or copayment

First 3 pints of blood

Skilled nursing facility coinsurance

Part A deductible

Part B deductible

Part B excess charges

Foreign travel emergency

A B C* D F1* G1 K2 L3 M N4
50% 75%
50% 75%
50% 75%
50% 75%
50% 75% 50%
80% 80% 80% 80% 80% 80%

* Plan F and Plan C are not available to Medicare beneficiaries who became eligible for Medicare on or after January 1, 2020. If you became eligible for Medicare before 2020, you may still be able to enroll in Plan F or Plan C as long as they are available in your area.

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1 Plans F and G offer high-deductible plans that each have an annual deductible of $2,370 in 2021. Once the annual deductible is met, the plan pays 100% of covered services for the rest of the year. The high-deductible Plan F is not available to new beneficiaries who became eligible for Medicare on or after January 1, 2020.

2 Plan K has an out-of-pocket yearly limit of $6,220 in 2021. After you pay the out-of-pocket yearly limit and yearly Part B deductible, it pays 100% of covered services for the rest of the calendar year.

3 Plan L has an out-of-pocket yearly limit of $3,110 in 2021. After you pay the out-of-pocket yearly limit and yearly Part B deductible, it pays 100% of covered services for the rest of the calendar year.

4 Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to $50 copayment for emergency room visits that don’t result in an inpatient admission.

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What Medigap Costs

Medicare Supplement Insurance is sold by private insurance companies, meaning the cost of these plans will differ from one place to the next. There are several factors that can affect the cost of a plan:

  • Location
    The cost and availability of health care in a given area can affect the price of the Medigap plans sold there. The level of competition among local insurance providers can also have an effect on cost.

  • Price structure
    There are three different ways that Medicare supplement policies are generally priced. A community-rated plan offers the same price to everyone. An issue-age-rated policy bases the price on the patient’s age at the time of enrollment. And an attained-age-rated plan increases in price as the patient ages.

  • Basic benefits
    Not all Medigap plans offer the same amount of basic benefits so it’s natural that plans offering a higher level of benefits will cost more than plans with less coverage.

  • Underwriting
    If patients sign up for a Medigap plan outside of their six-month Medigap open enrollment period, they may be subject to underwriting, which means the insurance company can charge a higher rate based on a patient’s health status.

  • Discounts
    Because insurance companies are free to set their own prices for Medigap plans, they are also free to offer their own discounts for women, non-smokers, married couples or even paying annually instead of monthly.

Shopping for Medicare Supplement Insurance

The best way to shop for a Medicare Supplement Insurance is to leverage the help of a professional. A licensed agent can help you analyze your health care needs and assist with selecting a Medigap plan that is most compatible with those needs.

An agent can also help you compare quotes from various insurance companies in your area, allowing you to choose the most affordable offer.

Speak with a licensed agent at 1-800-995-4219 for a free Medicare Supplement Insurance policy quote today.

Resource Center

Compare Medigap Plans 2021

See how the 10 Medigap plans differ. Review our chart for a detailed comparison of Medicare Supplement insurance benefits and compare Medigap options where you live. Read more
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