Original Medicare covers many healthcare costs, but it leaves significant gaps: deductibles, coinsurance, and copays with no annual out-of-pocket cap. That's where Medigap, also known as Medicare Supplement Insurance, steps in.
Think of Medigap as a private insurance policy that pays for what Original Medicare doesn't. There are ten standardized plans, labeled A through N, each offering a different set of benefits. Thanks to federal law, the benefits for a given plan letter—say, Plan G—are identical regardless of which insurance company sells it. What varies is the premium.
Pricing comes in three flavors: community-rated (everyone pays the same), issue-age-rated (price depends on your age when you buy), and attained-age-rated (premiums rise as you get older). Attained-age plans start cheap but can become expensive over time.
The most critical window is the Medigap Open Enrollment Period. It begins the month you turn 65 and enroll in Medicare Part B and lasts six months. During this period, insurers cannot deny you coverage or charge more due to pre-existing conditions. Miss it, and you may face medical underwriting.
For many, Plan G is the most popular choice because it covers all coinsurance and copays except the Part B deductible. Plan N offers a lower premium in exchange for small copays at doctor visits and emergency room visits.
Understanding these basics helps seniors make informed decisions and avoid costly mistakes. For a deeper dive into Plan G versus Plan N costs, watch the companion video.