Is your 65th birthday just around the corner? Are you soon losing your employer-based health insurance policy and finally retiring? If your answer is yes to both questions, then you might want to start learning about Medicare Supplement Insurance.
What is Medigap and what can it do for me?
Medicare Supplement Insurance is private health insurance that you can use to supplement your Medicare benefits. Note that Medigap only “supplements” Medicare. It does not “replace” it. Medigap basically fills in the gaps left by Medicare such as deductibles, co-insurance and co-pays. These out-of-pocket costs can take a significant chunk of your income or retirement savings.
The AARP Public Policy Institute reported that about four million beneficiaries annually spend more than $8,300 on health care out-of-pocket costs. Medigap plans help you cover these expenses. In short, Medigap can help you save on health care. That’s a very good reason to get one.
When can I enroll?
You have a six-month Medigap open enrollment period that starts the first month you’re 65 and enrolled in Part B. The best time to enroll in Medigap Insurance is during that period because you are not subject to medical underwriting then. This really works in your favour especially if you have a pre-existing condition. Insurance companies cannot deny your application because of a health problem.
What plan suits me best?
This really depends on your current and future health care needs. There are 10 available Medigap plans and each plan is designated by a letter. If you need the most comprehensive coverage, Medigap Plan F is your plan of choice. Medigap Plan A offers the fewest benefits.
One of the best things about these plans is that they are standardized. If you’re looking for Medigap Plan F, you’ll find that all insurance companies offer the same Plan F benefits. Since the benefits are the same, you just have to focus on the rates.
Do rates differ?
Although benefits are standardized, rates aren’t. It would be wise to do some comparison-shopping first to see which company offers the most affordable rate.
What to look for in a company?
As much as possible, you want to make sure an insurance company has the capacity to pay your claims. Companies are rated for financial soundness. Independent rating organizations, like A.M. Best, Moody’s, and Standard & Poor’s, give ratings up to A+ to indicate financial stability of insurance companies.
I know that when you’re initially eligible for Medicare, you’ll find a myriad of health insurance options. I suggest that you look into these options months before you need to make a choice so you can make an informed decision that fits your situation. Of course, we’re here to help make things easy and hassle-free. You’re free to talk to one of our personal advisors whenever you need expert advice on Medigap or Medicare Advantage plans.
Jim McFadden has over 11 years of executive-level experience in the health insurance industry, is a youth baseball, softball and football coach, and has one of the worst fantasy football records in the world.