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Medicare Supplement Insurance Benefits

4 things to know about Medigap benefits:

  1. There are 9 types of benefits that Medigap plans can include.
  2. Plan F is the only plan that includes all 9 benefits.
  3. Each of the 10 plan options includes a different combination of benefits.
  4. Some plans are cost-sharing. That means your benefits will only pay for a percentage of a particular expense.

In general, Medigap policies cover co-insurance, co-payments, deductibles, and other health care costs not covered by Medicare. There are 9 specific types of Medicare-related expenses that Medicare Supplement insurance policies may cover. They are:

  1. Part A hospital care co-insurance
  2. Part A hospice care co-insurance or co-payment
  3. Part B co-insurance or co-payment
  4. First 3 pints of blood
  5. Part A deductible
  6. Part B deductible
  7. Part B excess charges
  8. Skilled nursing care
  9. Foreign travel emergency care

The bold items in the list are the expenses covered by all Medicare Supplement insurance plans. The other items may or may not be covered, depending on which plan option you choose.

Since each plan is different, it’s important to understand which benefits are included in the Medigap policy you plan to buy. The following chart shows which plan options cover which expenses. If a box contains a “√”, it means that plan covers the expense 100%. If a box contains a percentage, it means that plan option will pay only that portion of the expense.

Medicare Supplement benefits A B C D F1 G K2 L3 M N4
Part A hospital care co-insurance & costs
Part A hospice care co-insurance or co-payment 50% 75%
Part B co-insurance or co-payment 50% 75%
First 3 pints of blood 50% 75%
Part A deductible 50% 75% 50%
Part A skilled nursing care co-insurance 50% 75%
Part B deductible
Part B excess charges
Foreign travel emergency
1. Plan F offers a high-deductible plan. This plan requires you to pay a $2,180 deductible before it covers anything.
2. Plan K has an “Out-of-Pocket” yearly limit of $4,960 (in 2016). 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 $2,480 (in 2016). 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 co-insurance, except for a co-payment of up to $20 for some office visits and up to a $50 co-payment for emergency room visits that don’t result in an inpatient admission.

What Medigap policies cover

Medigap policies have 4 required benefits that must be included and 5 optional benefits that are only included with some plan options.

Required benefits

The following 4 benefits are included, at least in part, in every Medigap policy:

  • Part A hospital care co-insurance
  • Part A hospice care co-insurance or co-payment
  • Part B co-insurance or co-payment
  • First 3 pints of blood

No matter which Medigap plan option you choose, these costs will be covered.

The following explains each of the benefits in detail.

Part A hospital care co-insurance

Medicare Part A covers in-patient hospital stays. But if your stay lasts longer than 60 days, you have to make a co-insurance payment for each day you’re still in the hospital. And, after a certain point, Medicare stops covering your inpatient hospital costs altogether.

If you have a Medicare Supplement insurance policy, it will cover the co-insurance costs. The co-insurance is $322 per day for days 61 to 90 of your hospital stay. Beyond 90 days, there’s a $644 co-insurance per day.

If you have a Medigap policy, it also will cover any in-patient hospital costs after Medicare stops covering them. It will do so for up to 365 days after you use up your Medicare benefits.

Part A hospice care co-insurance or co-payment

Medicare Part A hospice care covers respite care and prescription drugs for pain relief. However, there is a 5% co-insurance for respite care and a $5 co-payment for each prescription drug.

If you have Medicare Supplement insurance, it will pay for the co-insurance and co-payments.

Note: Plans K and L cover only a portion of the co-insurance and co-payments.

Part B co-insurance or co-payment

Medicare Part B covers preventative services and necessary supplies to diagnose and treat medical conditions. Part B only pays 80% of the Medicare-approved amount for a particular service. So if the Medicare-approved cost for a service is $1,000, Medicare only pays for $800 of it.

If you have a Medigap policy, it will cover the remaining 20%.

Note: Plans K and L cover only a portion of the co-insurance or co-payment.

First 3 pints of blood

Medicare only covers the cost of blood for the 4th pint and beyond for a blood transfusion. It doesn’t cover pints 1 – 3.

If you have a Medigap policy, it will cover the first 3 pints of blood.

Optional benefits

The following 5 benefits are covered, at least in part, by some Medicare Supplement insurance plans. However, some plan options do not cover them.

  • Part A deductible
  • Part B deductible
  • Part B excess charges
  • Part A skilled nursing care co-insurance
  • Foreign travel emergency care

The following explains each of the benefits in detail.

Part A deductible

Medicare Part A covers a range of hospital costs. But before coverage kicks in, you need to pay a deductible. In 2016, the deductible is $1,288 per benefit period.

9 out of the 10 Medicare Supplement insurance plan options cover the Part A deductible. The only plan option that doesn’t cover it is Plan A.

Note: Plans K, L, and M cover only part of the Part A deductible. Plans K and M cover 50% of it, and Plan L covers 75% of it.

Part B deductible

Medicare Part B covers a range of preventative and diagnostic services. But before coverage kicks in, you need to pay a deductible. In 2016, the deductible is $166 per year.

If you have Medicare Supplement Plan F or Plan C, your policy will cover the Part B deductible. No other plan options include this coverage.

Part B excess charges

In some cases, a health care facility will charge up to 15% more than the Medicare-approved amount for a service.

If you have Medicare Supplement Plan F or Plan G, your policy will pay for the extra charges. No other plan options include this coverage.

Part A skilled nursing care co-insurance

Medicare Part A covers some skilled nursing facility services. But after 20 days of this care, you need to start paying daily co-insurance to keep your coverage going. For days 21 through 100 in a skilled nursing facility, the daily co-insurance is $161.

Medicare Supplement insurance will cover this cost unless you have Plan A or Plan B. If you have any other plan, it will be covered at least partially.

Note: Plan K covers only 50% of the co-insurance and Plan L only covers 75% of it.

Foreign travel emergency care

Medicare only covers foreign emergency health care in a small set of rare situations.

If you have Medicare Supplement Plans C, D, F, G, M, or N, your insurance company will pay 80% of the billed charges for certain medically necessary emergency care received outside of the United States. You must pay a $250 deductible for these services. The plans have a lifetime coverage limit of $50,000.

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