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If you have a Medicare supplement plan – aka Medigap – there may be times when you should make sure it is still best for you.
Medigap policies are standardized – plans with the same names offer the same benefits no matter which private insurance company sells them – but the premiums vary depending on the plans, insurers and locations. And while some beneficiaries are facing modest annual price increases, others may experience steeper jumps.
“For some fixed-income beneficiaries, a high premium increase could disrupt their budget,” said Elizabeth Gavino, founder of Lewin & Gavino and an independent broker and general agent for Medicare plans.
About 14.6 million, or 23%, with 63.8 million Medicare beneficiaries using Medigap plans along with the basic Medicare, which consists of Part A (hospital coverage) and Part B (outpatient care). These policies at least partially cover related aspects of cost sharing – deductibles, co-payments and co-insurance – and generally allow you to contact any doctor (or other healthcare provider) who takes Medicare.
They are separate from private Advantage plans and cannot be used in conjunction with them. About 40% of Medicare beneficiaries choose to supply parts A and B under these plans, which typically include coverage for prescription drugs in Part D. They also come with their own surcharges, deductibles and other common costs.
Available Medigap policies are indicated A, B, C, D, F, G, K, L, M and N and each offers a different level of coverage. For example, they may pay the full Part A deductible ($ 1,556 in 2022 for each benefit period), while others do not. Medical and Medicaid Services Centers have a schedule on your website which shows the differences.
However, not every plan is available in all states. Also, plans C and F are not available to those eligible for Medicare again in 2020 or later.
Medigap plans also do not cover the costs associated with reimbursement of prescription drugs (unless the policy may not have been issued before 2006), which means purchasing a separate Part D plan if you want your drugs to be covered. They also don’t help you pay for services that are excluded from Medicare coverage, generally speaking, such as dental or visual.
As for the cost of premiums, it depends on many factors, including the insurer and the place of residence. A 65-year-old woman in Dallas can pay less than $ 100 a month for Plan G, while in New York the same person would pay $ 278, according to the American Supplementary Insurance Association Medicare. And, generally speaking, these premiums are growing over time.
For those who are experiencing an increase that is unmanageable, or otherwise believes that the cost of the policy is more than it can withstand, a more appropriate option may be.
You can buy a Medigap policy at any time of the year. However, keep in mind that while you get six months when you first sign up for Part B to get a Medigap plan without medical underwriting, outside of that window it’s not always the case.
Depending on your state’s Medigap enrollment laws, “applying with a new operator can mean answering health questions and getting health insurance,” said Daniel Roberts, co-founder of Boomer Benefits. “So in many states, your approval of a new policy depends on your ability to pass insurance.”
If that’s not a hindrance, you could see if another insurer offers the same Medigap plan at lower prices, Roberts said.
You can also find out if another Medigap policy will be better, or whether switching to an Advantage plan is justified.
“Sometimes they can pay for Cadillac coverage that they don’t use if they’re better suited to get a high-deductible app or [Advantage Plan]”Gavino said.
If you are considering an Advantage plan to replace Medigap, keep in mind that you will usually need to register during the fall open registration (October 15 to December 7), and coverage is valid from January 1.
Also, when you first try the Advantage plan, you will receive a trial period of 12 months. This means that if it doesn’t fit, you can usually return to your Medigap policy this year without worrying about health insurance.
Although Advantage plans often come free of charge – although you still pay a premium on Part B, which is $ 170.10 for 2022 – they also have some limitations.
“These plans usually have much smaller premiums, but the trade-off is that there are things like networks and previous permissions,” Roberts said.
And you will pay for things like co-payments and co-insurance.
This means that in years when you don’t use a lot of health care, you can spend less than with a Medigap plan.
“But in the years when you are treated regularly … you can potentially spend more out of your own pocket with the Advantage plan than with your former Medigap plan,” Roberts said.
“We see that many people love their Advantage plans as long as they are healthy, but later they are less happy when faced with more frequent doctor visits about a new health condition or starting treatment for something chronic and / or expensive,” Roberts said.
“So read the fine print and make sure you understand your share of the medical costs before enrolling,” she said.