Medicare comes with a lot of letters — A, B, D, G, N, K, L. Medicare beneficiaries can choose to enroll in Part A and Part B through (1) the government-run Original Medicare program or (2) a Medicare Advantage plan offered by private insurance companies. Digging through those options you find that Medicare Part A and Part B have a cost-sharing snag that is not evident in Medicare Advantage plans. Part B alone is an 80/20 plan—Medicare pays only 80% of approved fees; you are on the hook for the remaining 20%. Depending on your health, that can get expensive quickly.
This is where Medigap comes in. Medigap – also called Medicare supplement plans– works with your existing Medicare Part A, B and D to cover co-insurance costs.
This piece explains what Medigap is, how to tell whether it fits your needs, why timing matters when you first become eligible, how to compare policies and premiums, and what to know if you want to move between Medigap and Medicare Advantage.
Every retiree’s situation is a little different so you may not need every section here. Glance at the contents below and look for the description that sounds most like you. If you’re new to Medigap altogether, start with the short explanation of what these plans do.
Our hub article explains how Medigap fits alongside Original Medicare and Medicare Advantage. For a side-by-side look at specific plan letters, see our companion comparison guide.
Topics Covered in This Article:
- What Medigap Is
- Is Medigap the Right Approach for You?
- Your First Medigap Enrollment Window Matters
- State Medigap Rules
- Shop the Market: Compare Companies, Not Just Plan Letters
- What Happens If You Want to Switch?
- Don’t Forget Prescription Drug Coverage
- A Simple Medigap Checklist
What Medigap Is
Original Medicare — Part A and Part B — covers a wide range of health care services. But it doesn’t pay 100% of your costs, and it has no yearly limit on what you pay out of pocket. You’re responsible for deductibles, coinsurance and other cost-sharing when you receive covered care.
This is where Medicare Supplement Insurance, commonly called Medigap, can help. Medigap is private insurance that helps pay some of the out-of-pocket costs that Original Medicare does not. Depending on the plan, that can include certain deductibles, coinsurance and copayments. Some Medigap policies also provide limited coverage for emergency care during foreign travel.
But Medigap doesn’t cover everything Original Medicare leaves out. For example, it generally does not cover long-term care, routine dental or vision care, hearing aids or prescription drugs.
Medigap is not Medicare Advantage (MA). This distinction is important:
- Original Medicare + Medigap: You receive your Medicare benefits through Original Medicare, and the Medigap policy helps with certain out-of-pocket costs.
- Medicare Advantage: You receive your Medicare Part A and Part B benefits through a private insurance carrier. Many Medicare Advantage plans include some or all of the benefits that a Medigap policy provides.
Medigap is designed to work with Original Medicare. It does not work with Medicare Advantage, and it can’t be used to pay Medicare Advantage copayments, deductibles or premiums. Unless you’re leaving Medicare Advantage to return to Original Medicare, no one should be selling you a Medigap policy while you’re in a Medicare Advantage plan. If someone tries, that’s a red flag worth questioning.
In most states, standardized Medigap policies are identified by letters, such as Plan G, Plan N, Plan K and Plan L. Plans with the same letter generally provide the same standardized benefits, regardless of which insurance company sells it.
Something to Note:
The benefits are standardized. The price is not. Plan G from one company generally provides the same core benefits as Plan G from another company — but the two companies may charge different premiums. That means choosing the plan letter is only half the decision. Choosing the insurance company and comparing its premiums is the other half.
Is Medigap the Right Approach for You?
Before you buy—or switch to a Medicare Advantage (MA) plan—to cover the costs Medicare does not cover–consider the following:
- Do you want the flexibility of Original Medicare and the ability to see any doctor or specialist who accepts Medicare? How important are your current doctors to your decision?
- Would you rather pay a Medigap premium in exchange for help with Medicare cost-sharing expenses?
- Do you travel frequently or spend significant time in different states?
- Would the additional benefits (i.e., routine dental care, vision exams, hearing, gym memberships) offered by some Medicare Advantage (MA) plans be valuable to you? Would you use them?
- Can you comfortably afford the Medigap premium along with your other Medicare costs? Does the premium increase as you age or as healthcare costs rise?
Do some math: (1) compare the amount of the premiums for a Medigap supplement plan with the Medicare Advantage plan and (2) the deductibles and copays of a Medigap supplemental plan to the maximum out of pocket you would pay.
There is no single “best” Medicare choice for everyone. The right answer depends on your health care needs, budget and priorities.
Your First Medigap Enrollment Window Matters
When it comes to Medigap, timing really does matter.
| Enrollment Phase |
What You Need to Know |
| Medigap Open Enrollment | Begins when you’re 65 or older and enrolled in Medicare Part B. You get a one-time, 6-month window to buy any Medigap plan sold in your state without being turned down (guaranteed issue) or charged higher premiums because of a health condition. |
| After the 6-month window closes | You may still be able to buy a Medigap policy, but depending on your circumstances and state, an insurer may medically underwrite your application. That could mean a higher premium, fewer choices or — in some situations — denial of coverage. |
| Guaranteed issue rights | Certain situations, such as losing qualifying coverage through no fault of your own, can give you a guaranteed right to buy a Medigap policy. In those circumstances, an insurer generally cannot use your health history to deny you coverage or charge you more. Which plans you can buy with this right depends on your situation and your state. |
State Medigap Rules
Some states give residents extra opportunities to change Medigap policies without medical underwriting. You may hear these described as “birthday rules” or “anniversary rules,” but they don’t all work the same way. Some limit which plans you can switch to, some limit the window to a particular period, and some apply only to people who already have Medigap.
A growing number of states offer these protections, and because the rules vary — and can change — it pays to check before you act. Your state’s Insurance Department or your State Health Insurance Assistance Program (SHIP) can tell you whether you have a state-law right to switch Medigap plans without medical underwriting.
Shop the Market: Compare Companies, Not Just Plan Letters
Once you’ve chosen the Medigap plan letter that fits your needs, there’s another important decision: which insurance company to buy from?
Because policies with the same letter generally provide the same benefits, price becomes the key point of comparison. Premiums for the identical plan can vary significantly between insurers, driven by where you live, how a company sets rates as you age, its claims experience and how it calculates rate increases.
Medicare identifies three common ways insurers price Medigap policies:
- Community-rated: Generally, people in the same area pay the same premium regardless of age.
- Issue-age-rated: Your premium is based on your age when you buy the policy. It generally does not increase because you get older.
- Attained-age-rated: Your premium is based on your current age and generally increases as you get older.
The practical takeaway: don’t stop at the first quote. When you get quotes:
- Compare the same plan letter, in your ZIP code, for your age, from several insurers.
- Ask how the policy is priced (community-rated, issue-age-rated or attained-age-rated).
- Ask how often, and by how much, premiums have gone up in recent years.
- Look past introductory or first-year discounts.
- Ask about household, non-smoker or other discounts.
- Ask whether you’ll be medically underwritten and whether there’s a waiting period for pre-existing conditions.
- Confirm the company is licensed to sell Medigap in your state.
- Check the carrier’s financial ratings through S & P, A.M. Best, or Moody’s.
The lowest premium today isn’t necessarily the lowest-cost choice over several years. A slightly higher premium may make sense if the insurer’s premium history and rating method are more favorable — though there’s no guarantee any insurer’s future increases will follow its past pattern.
Something to Note:
Free, unbiased help is available. Every state has a State Health Insurance Assistance Program (SHIP) with trained counselors who can help you compare Medigap policies, understand your state’s rules and check your enrollment rights — at no cost. SHIP counselors don’t sell insurance.
What Happens If You Want to Switch?
This is where Medicare rules can become especially confusing. There are several different situations, and the reason you’re leaving, and the date your coverage ends, matters.
- Your Medicare Advantage plan is ending: Medicare Advantage (MA) plans change from year to year. A plan can leave a service area, stop offering a particular plan or end its contract with Medicare. If you lose your Medicare Advantage coverage this way, you generally have a guaranteed issue right — an important opportunity to return to Original Medicare and buy a Medigap policy without medical underwriting.
Depending on your situation, your choices are:
- Choose another Medicare Advantage plan, if one is available in your area and meets your needs; or
- Return to Original Medicare (Parts A and B) and apply for a Medigap policy using your guaranteed issue right.
You can generally apply for Medigap as early as 60 days before your Medicare Advantage coverage ends and no later than 63 days after it ends.
Tip: Also check your state’s rules. Some states require continuous or annual guaranteed issue for Medigap for people 65 or older.
- You’re moving out of your plan’s service area: You generally have the same protected window to apply for a Medigap policy without health screening: as early as 60 days before your Medicare Advantage coverage ends through 63 days after it ends. Keep your plan’s letters and other documentation, because you may need to show the insurer that you qualify for guaranteed issue.
Give yourself time. In either situation, start comparing your Original Medicare, Medigap and Part D options as soon as you receive notice that your coverage is ending.
- You simply want to leave Medicare Advantage. You can switch from Medicare Advantage back to Original Medicare during Medicare’s Open Enrollment Period (October 15–December 7) or the Medicare Advantage Open Enrollment Period (January 1–March 31).
But leaving by choice generally doesn’t give you a guaranteed issue right to Medigap. Without one, a Medigap insurer can ask health questions, request records, charge a higher premium, or turn you down based on your medical history.
Before you leave, find out whether you can get a Medigap policy — and at what price — and check whether your state offers extra protections. If you joined Medicare Advantage within the past year, see the “trial rights” described below.
4.You want to switch from Medigap to Medicare Advantage. You can choose to leave Original Medicare and enroll in Medicare Advantage when you’re eligible to do so. But don’t assume you can easily get your Medigap policy back later. If you drop Medigap to join Medicare Advantage, you may not be able to buy the same Medigap policy — or, in some circumstances, any Medigap policy — if you later return to Original Medicare.
There are important exceptions, called trial rights. If you drop Medigap to join Medicare Advantage for the first time, you generally have a 12-month trial period in which you may return to Original Medicare and get your Medigap policy back, subject to the applicable rules. There is also a special trial right for some people who joined Medicare Advantage when they were first eligible for Medicare at 65.
Before dropping Medigap, check your right to get it back. This is one decision where a little research up front can prevent a very expensive surprise later.
Don’t Forget Prescription Drug Coverage
Medigap and prescription drug coverage are separate. Medigap policies generally don’t include retail prescription drug coverage. If you have Original Medicare and want drug coverage, you generally need to enroll in a separate Medicare Part D plan.
This becomes especially important if you’re leaving Medicare Advantage. Suppose your Medicare Advantage plan includes drug coverage (an MAPD plan). If you move back to Original Medicare, that drug coverage doesn’t follow you. You’ll generally need to enroll in a standalone Part D plan, and your enrollment opportunity and deadlines depend on why you’re leaving Medicare Advantage.
Watch for gaps. If you go 63 days or more in a row without creditable drug coverage, you may owe a late enrollment penalty for as long as you have Part D. Pay close attention to the notices you receive about both your Medigap policy and your Part D coverage. The two types of coverage have different rules and deadlines.
A Simple Medigap Checklist
If you’re shopping for Medigap, here is a practical place to start:
- Know your Medicare status. Are you enrolled in Original Medicare or Medicare Advantage? Do you have Part A and Part B?
- Check your timing. Are you within your six-month Medigap Open Enrollment Period?
- Do you have a guaranteed issue right? Does your state provide additional protections?
- Choose the plan letter. Compare the benefits of the Medigap plans available in your state.
- Compare several insurers. Get written quotes for the same plan letter.
- Look at how premiums are priced. Ask whether the policy is community-rated, issue-age-rated or attained-age-rated. Compare the amount of the premiums for a Medigap supplement plan with the Medicare Advantage plan.
- Look beyond today’s premium. Ask about the company’s premium history and discounts.
- Compare the deductibles and copays of a Medigap supplement plan to the maximum of out- of- pocket you would pay.
- Don’t forget Part D. Medigap generally doesn’t include retail prescription drug coverage.
- Don’t cancel existing coverage too soon. If you’re replacing one Medigap policy with another, you generally get 30 days to decide whether to keep the new one (you’ll pay both premiums for that month), so keep your old policy until you’re sure. If you’re dropping Medigap to join Medicare Advantage, make sure you understand your rights if you later want to return to Original Medicare.
- Get free help. Your State Health Insurance Assistance Program (SHIP) is an independent government program with trained counselors in every state. It offers free, unbiased Medicare counseling.
Medicare may seem like a maze at first. But you don’t have to solve every part of it at once. Start with what coverage you have now, what you want your coverage to do, and what deadlines apply to you. Then compare your options one step at a time.
Continue the series:
[Medicare Basic] · [Part A and Part B] · [Part D] · [Medigap Plans: G, N, K, and L] · [Medicare Advantage Plans] · [Financial Assistance] · [Appeals]