| Medicare Supplement: Managing Your Healthcare on a Fixed Income in Retirement

medicare supplemental insurance


The following are some of the considerations to take into account when choosing Medigap insurance on a fixed income.

When you’re living on a fixed income in retirement, applying for a Medicare Supplement plan can help you stretch your savings and investments so you don’t worry about your financial future. While fixed income is dependable and stable, it can make unexpected expenses stressful. Extra health insurance helps ease the burden.


Retired couple benefiting from Medigap insurance

Medicare Supplement insurance, also known as Medigap insurance, covers healthcare expenses that Original Medicare doesn’t. Even if you’re enrolled in Original Medicare Parts A and B, you’ll still have deductibles, coinsurance, and copayments when you visit the doctor or a hospital.

For instance, in 2018, the Original Medicare Part B deductible is $183. This means that you must pay $183 out-of-pocket before Original Medicare will pick up the bills. However, if you choose a Medicare Supplement plan that covers your Part B deductible, such as Medigap Plan F, you won’t have to pay anything out-of-pocket before your insurance kicks in.

There are 10 Medigap insurance plans from which to choose: Medicare Supplement Plans A, B, C, D, F, G, K, L, M, and N.

Medicare Supplement Insurance Plans

Each covers a different set of healthcare expenses, so you can apply for the plan that’s right for you.

If you decide you want a Medicare Supplement, you can choose any private insurance company that offers your desired plan in your zip code. Insurance companies set their own premiums, so use the Ensurem Medigap Quoter to find the best option in your area.

You don’t have to worry about comparing coverage levels. If two insurance companies offer Medigap Plan A, each offers the same benefits because the plans are standardized. The only exception occurs if you live in Massachusetts, Minnesota, or Wisconsin. Those states have different Medigap insurance standards.


When you live on a fixed income, you might need to carefully budget your savings and incoming money. Insurance allows you to better forecast your healthcare costs because you’re paying a fixed premium every month.

To avoid certain unexpected healthcare costs, you can pay upfront for Medigap insurance coverage. Depending on the coverage levels you desire, you can keep your monthly costs low while you still enjoy breathing room in your budget.

For example, let’s say that your Medigap Supplement policy covers your Part B excess charges in full. When you visit a doctor who accepts Original Medicare, he or she might charge slightly more than Medicare covers. However, Medigap Plans F and G both cover 100 percent of those extra charges, so you won’t have to pay them out-of-pocket.

Many retirees worry about keeping their finances in check after they stop working. You can alleviate some of those concerns by preparing in advance and keeping unexpected costs at bay.


Plenty of flexibility exists in Medicare Supplement insurance, which allows retirees to decide exactly how much coverage they want to buy.

Medigap Plan F, for instance, offers the most comprehensive coverage. It covers 100 percent of your Original Medicare deductibles, coinsurance, and copayments, as well as the first three pints of blood drawn every year and 80 percent of foreign travel emergency expenses.

If you visit your general practitioner, you won’t have to pay a $10 copayment before you can see the doctor. Similarly, you won’t have to pay out-of-pocket for in- or out-patient hospital fees as long as they’re covered under Original Medicare.

Knowing your healthcare costs in advance can also help you plan for your financial future. Having money left over might permit you to invest some of your income to generate capital gains.

Additionally, you don’t need to pay more for Medicare Supplement insurance plans that cover costs unrelated to your needs. If you don’t travel internationally, you don’t need coverage for foreign travel emergency. Keep those details in mind when researching potential Medigap insurance policies.


When choosing a Medicare Supplement, consider each of the four types of expenses related to healthcare coverage:

    • Premium: Every month, you pay your insurance company a premium. It’s a fixed amount that grants you access to the coverage levels described in your Medigap insurance plan.
  • Deductible: Some plans cover deductibles related to Original Medicare Parts A and B. A deductible is the amount of money you must pay out-of-pocket before your insurance company will begin paying out for services rendered.
  • Coinsurance: You might also have to pay coinsurance, which is a percentage of the fee a healthcare professional charges. For instance, if insurance covers 80 percent, you must pay the remaining 20 percent.
  • Copayments: When you visit a doctor’s office or hospital, you might be charged a small copayment, which is a fixed fee.

Before you choose a Medicare Supplement plan, look over your budget and figure out how much you’re able and willing to pay each month for supplemental coverage. That’s your premium.

As long as you apply during your Initial Enrollment Period, which begins on the first day of the month during which you turn 65, your insurance company can’t charge you more because of pre-existing health conditions. There might be a six-month waiting period before pre-existing conditions are covered, but afterward, you won’t have to worry about increased premiums or denied coverage due to your age or health status.

Take into consideration the deductibles, coinsurance, and copayments Medigap insurance will eliminate from your responsibility. Compare those numbers against what you’ll pay per month in your premiums to figure out what Medigap insurance plan makes the most sense for you.

Keep in mind that some insurance companies offer discounts when both you and your spouse purchase a Medigap policy from the same insurer. That’s another way to save money on a fixed income.


Preparing for retirement can seem overwhelming, but if you take unexpected healthcare costs out of the equation, you might feel more prepared. Consider applying for a Medicare Supplement plan when you turn 65. It adds more value to Original Medicare and gives you more control over your healthcare costs.

New call-to-action
New call-to-action