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Medicare Supplement Insurance Plans Costs and Benefits

Christian Worstell

by Christian Worstell | Published April 26, 2021 | Reviewed by John Krahnert

Medicare Supplement Insurance plans (Medigap) help cover some of the health care costs that Original Medicare benefits don't pay for. Medigap plan costs are rated in one of three ways: community rating, issue-age rating and attained-age rating.

Learn more about Medicare Supplement Insurance plan costs and compare the basic benefits of each type of policy.

How Medigap Plan Costs Are Determined

Medicare Supplement Insurance plan costs are typically determined based on three types of ratings. Health insurance companies – such as Aetna – determine which type of Medigap policy rating they use.

  1. Community Rating
    For a Medigap policy that is community rated, your age does not affect the premium that insurers charge when you buy a policy. Premiums also won't change because of how old you are. That said, premiums may rise because of inflation and other factors.

  2. Issue-Age Rating
    With these kinds of Medicare Supplement Insurance policies, your premium is based on your age when you buy your policy. That means your premiums will likely be lower if you purchase your policy when you're younger. They will not change due to your age, though they may increase because of inflation and other factors.

  3. Attained-Age Rating
    Under this type of Medigap plan cost rating, monthly premiums are based on your current age. That means the older you get, the more your premium will rise. 

Other factors can affect your Medicare Supplement Insurance plan costs, including:

  • Discounts, including those to females and non-smokers (not all providers offer plan discounts)
  • High-deductible options, such as High-Deductible Medigap Plan F
  • Medical underwriting, if your plan is purchased outside of your Medigap open enrollment period
  • Purchasing a Medicare SELECT policy, available in some states

Medigap Plan Benefits are Standardized, But Costs Are Not

The federal government standardizes Medigap policies. That means that, from one insurer to another, each policy of the same type will retain the same basic benefits.

Use the following chart to compare the basic benefits of each type of Medicare Supplement Insurance plan.

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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

Medicare Supplement Benefits A B C* D F1* G1 K2 L3 M N4
Part A coinsurance and hospital coverage
Part B coinsurance or copayment 50% 75%
Part A hospice care coinsurance or copayment 50% 75%
First 3 pints of blood 50% 75%
Skilled nursing facility coinsurance 50% 75%
Part A deductible 50% 75% 50%
Part B deductible
Part B excess charges
Foreign travel emergency 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 $2,490 in 2022. 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 $6,620 in 2022. 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 $3,310 in 2022. 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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While Medigap Plan N from one insurance provider will offer the same basic benefits as Plan N from another insurance company, the costs will vary — sometimes by a lot.

This is why it's important to learn how your insurer determines your Medicare Supplement Insurance plan cost. How your insurer prices your policy may not only affect what you pay today, it may affect what you pay in the future.

 

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