Medicare Supplement (Medigap)
Sometimes called Medigap plans, Medicare Supplement (Medigap) plans are insurance policies sold by private insurance companies that supplement the coverage of policyholders enrolled in the federal Medicare Part A and B (“Original Medicare”) programs. (Policyholders with Medicare Parts A and B are also usually enrolled in a Medicare Part D prescription drug plan.) Individuals enrolled in a Medicare Part C Medicare Advantage plan are not eligible for a Med Supp policy.
Offered in lettered plans, all Med Supps are standardized. This means plans with the same letter offer the same benefits from carrier to carrier and in almost all states. Plans with different letters offer different benefits.
Medicare Part A covers a beneficiary if they are to receive Medicare-approved care at a facility, including inpatient hospitalizations, skilled nursing facilities, and home health care. For inpatient hospitalizations, the client must satisfy the Part A deductible before Medicare will cover the rest of their care for the first 60 days. If they are in the hospital beyond 60 days they will pay a per day copay up to 90 days. Beyond 90 days the client is utilizing their Lifetime Reserve Days, of which only 60 are available while the client is enrolled in Part A. All charges beyond the Lifetime Reserve Days are the responsibility of the beneficiary.
Part B coverage a beneficiary's outpatient Medicare-approved charges, including physician visits, outpatient tests and imaging, outpatient rehabilitation, durable medical equipment, and some medications administered at a doctor's office of outpatient facility (like chemotherapy and infusions). Each year, beneficiary's must satisfy a Part B deductible, then they receive 80% coverage for services leaving them to pay the remaining 20%. There is no maximum on the 20% a beneficiary may pay in any given year.
Beneficiaries with Original Medicare can see any doctor or facility that participate with Medicare, which is currently (2020) 93% of all doctors and over 5,300 hospitals in the country.
Physicians that accept Medicare are broken into two categories, either participating or non-participating.
• Participating Provider - accepts Medicare Assignment, meaning they agree that Medicare's limit for each service is payment in full. These providers bill Medicare directly for services and they are paid directly from Medicare.
• Non-Participating Provider - accepts Medicare clients, but they do not agree to accept Medicare's limit for services. They are allowed to bill up to 15% higher than Medicare's approved amount. These providers will bill Medicare directly, but Medicare will pay the beneficiary and it's the beneficiary's responsibility to pay the provider.
There are also Excluded Providers, that do not participate and are unable to bill Medicare for any services. It is the beneficiary's responsibility to cover the cost of services received from excluded providers as Medicare will not reimburse for any expenses
Original Medicare provides few extras, but those that are provided are essential to help a beneficiary stay healthy and active. Upon enrolling in Part B of Medicare, each beneficiary qualifies to receive a full physical within 12 months of joining that will be paid 100%. Afterwards, Medicare will pay for an Annual Wellness Visit, which is a list of questions that are reviewed with the beneficiary and covers a wide range of topics including physical, emotional and mental health, medication adherence, concerns, and so on.
Original Medicare also covers a wide range of preventive services to help beneficiaries detect any illnesses or disease early, including bone mass measurements, cardiovascular disease screenings, cancer screenings, colonoscopies, diabetes screenings, mammograms, and many others. [Visit https://www.medicare.gov/coverage/preventive-screening-services for more information]
Beginning January 1st of 2006, Medicare beneficiaries could enroll in Part D of Medicare to help cover the cost of their outpatient prescription drugs. Those on Original Medicare would sign up for a stand-alone Part D plan that's provided by a private insurance company.