While speaking about Medicare and its different coverage options available to Medicare beneficiaries, it is essential to understand what is covered in each of the different coverage options offered. Keeping in mind that there are many missing pieces to the coverage provided with the stand-alone Original Medicare Parts A and B plan, it is generally necessary to have additional coverage added, as an additional benefit, to go along with Original Medicare. This is the reason Medicare Supplement Insurance was created, to supplement the benefits that Original Medicare offers, while filling in the gaps of any missing pieces.
If you wish to know more about the basics of Medicare Supplement Insurance, how it works, its many benefits and coverage plans, the differences between one insurance carrier to the next, and how and when to enroll, read on!
What is Medicare Supplement Insurance?
Medicare Supplement Insurance, otherwise referred to as Medigap Insurance, is a federally regulated program offered as an insurance policy by different private insurance carriers. This coverage is provided in the form of private health insurance. The coverage works alongside a Medicare beneficiary’s Original Medicare Parts A and B coverage.
A Medicare Supplement policy helps a policyholder pay for most out-of-pocket costs that are not covered under Original Medicare. These costs Original Medicare leaves behind are typically in the form of copayments, deductibles, and coinsurance that are a Medicare beneficiary’s cost-sharing responsibility, while under the Original Medicare plan. Medicare Supplement coverage fills the gaps and covers most of the costs left behind.
As mentioned prior, Medicare Supplement policies are federally regulated and sold by private insurance companies. Like Original Medicare, these policy plans do not require a policyholder to use a specific network of doctors. This means that typically any doctor that accepts Medicare will also take a Medicare Supplement Insurance plan. According to the rules, this payment the doctor or medical facility will receive from the Medicare Supplement policy will be the difference owed after Medicare pays its share, minus the policyholder’s cost-share responsibility (deductible/copayment) of the policy.
The Many Benefits of a Medicare Supplement Insurance Plan
Having a Medicare Supplement Insurance policy will assist with better financial healthcare cost planning, as potential healthcare expenses could rise.
Original Medicare has an immense cost-sharing responsibility in the form of coinsurance, copayments, and deductibles that the Medicare beneficiary is responsible for paying. While covered under a Medicare Supplement policy, a policyholder is only accountable for the cost-sharing that the plan rules and guidelines layout. These cost-sharing out of pocket responsibilities are according to guidelines and rules specified in the policy coverage details, all other costs specified to be covered under the plan will be picked up by the Medicare Supplement plan. Remembering that the policy covers healthcare as a health insurance policy, and only covers using the guidelines outlined in the policy, there may be limits to the coverage’s and benefits offered in the plan.
Keeping this in mind, the costs that can arise throughout a Medicare beneficiary’s lifetime may be significant. Being a policyholder of a Medicare Supplement policy, compared to Original Medicare, can potentially drastically reduce the possible out-of-pocket cost-sharing responsibility associated with your healthcare needs, throughout the lifetime of your Medicare coverage. This will ensure a more financially secure future, as a reasonable out-of-pocket cost amount is essential when planning your retirement years.
Medicare Supplement policies are guaranteed renewable. This ensures that as long as a covered policyholder pays their premiums timely, they cannot be canceled by the insurance company.
Medicare Supplement policies give a policyholder the freedom to choose any doctor or hospital and coverage if you travel. There are not designated networks of doctors. You can see any doctor as long as they accept Medicare. Also, there is no need for referrals to see the doctor or specialist you desire to see. This gives the policyholder a choice to pick their healthcare providers and ensure that they receive the best healthcare available.
Essentially how it works is; you pay a monthly premium, each plan offered varies but might have a deductible and co-pay requirement. Once you have paid your share for a Medicare-covered service, the Medicare Supplement policy is responsible for picking up the rest, according to plans specifics. This means that you can set a worst-case scenario spending budget while a policyholder of a Medicare Supplement policy. This is not the case with an Original Medicare plan. There are no limits to the out-of-pocket cost-sharing responsibility you would be responsible for if enrolled only in Original Medicare.
Medicare Supplement insurance is set up to help those who need additional benefits to go alongside their current Medicare plan. This means that you are still enrolled in Original Medicare and will need to use the red, white, and blue card alongside your Medicare Supplement insurance card when going to the doctor or medical facility. Medicare Supplements are designed to be affordable, open, and accessible. Medicare Supplements are great for those who are very financially secure, and those who might not be as economically stable but need specified coverage or assistance.
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