| Is a Medicare Supplement Plan Right For You?

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This blog post will help guide you through purchasing a Medicare Supplement plan. But first, we’ll explain what Medicare Supplement insurance is and how it can bridge gaps in Medicare coverage.

Finding the best Medicare Supplement plans isn't always as simple as finding the plan with the best price. Consider the fact that your ultimate goal is to avoid unexpected out-of-pocket medical expenses. The lowest price may not always help you save money in the long run. To find the best Medicare Supplement plans that meet your specific needs, you’ll want to take time to find a plan during the Medicare Open Enrollment period (typically from October 15th to December 7th) with the right level of coverage that will properly supplement your current Medicare and health insurance plans.


The chart below outlines the health care costs covered by each Medicare Part.


As mentioned above, Medicare (no matter which part) has gaps in coverage that result in out-of-pocket costs. According to the official U.S. government site for Medicare (Medicare.gov), these costs may include:

  • Co-insurance
  • Co-payments
  • Inpatient care
  • Outpatient prescription drugs
  • Dental Services
  • Deductibles

It is estimated that these costs may total $629 a month for a person in good health. On an annual basis, that amount equates to nearly $8,000.


The Employee Benefit Research Institute estimates that $283,000 is the amount a couple (age 65+) may need to cover their health care costs in retirement.

That number is only going to go up as health care costs increase each year. In fact, the U.S. Department of Health and Human Services states that from 2010 to 2020, costs are expected to rise from $8,250 to $13,575.

As you age, health care represents a greater share of your income. According to the U.S. Bureau of Statistics, it more than doubles between the ages of 45 and 65.

On the flip side, Medicare only covers 50 percent of your health care costs. That means you could end up owing a lot for out-of-pocket costs. Here is where looking for the best Medicare Supplement plans come in handy.


Medicare Supplement plans work side-by-side with Original Medicare. They pick up most of the deductions and co-pays that are part of the Original Medicare structure. They are not restrictive to a specific coverage area and can be used with any doctor or hospital that accepts Medicare.

Supplemental plans started to appear in 1965 when the Medicare program was created. Deemed Medicare Supplement Insurance (or Medigap), these insurance plans officially came under federal oversight when Congress passed the Omnibus Reconciliation Act of 1980.

Some of the costs not covered by Medicare include:

A deductible is the set amount you pay before Medicare starts paying. Medicare has two deductibles: one for Part A, which covers hospital services, and one for Part B, which covers medical services.

Hospital expenses are applied after you meet your Part A deductible. Medicare pays your expenses for the first 60 days you’re in the hospital. Then you start paying $352 per day (in 2020). That amount increases the longer you’re in the hospital.

A portion of the cost of most services after you meet your Part B deductible. Medicare pays 80 percent of your costs. You pay the other 20 percent.

It’s easy to see your costs can add up. That’s where a Medicare Supplement plan can help:

  • The plan will pay your 20 percent co-insurance.
  • The plan will pay for your hospital expenses.
  • Some supplement plans pay one or both of your deductibles.
  • Some will pay for emergency care needed outside of the United States.

If you’re still reading this blog, you’re already aware that buying a Medicare Supplement policy is an important decision. Next we’ll outline the steps to purchasing a Medigap policy, starting with determining if it’s the right move for you.



As a Medicare recipient (or soon-to-be recipient), you must decide how you want to receive your benefits and if you need additional coverage.

If you do require additional benefits, you could either stick with Original Medicare and purchase supplemental insurance, or you could switch to a Medicare Advantage Plan. Below are the top 5 differences between Medicare Advantage and Medicare Supplement plans.*

Understanding and comparing these differences is a crucial first step to determining if Medicare Supplement insurance is right for you.



In both cases, you must have original Medicare, Part A and Part B. Note, however, you should be mindful of the Medigap Open Enrollment period. Do you qualify for guaranteed issue rights? The insurance company may not deny your application or charge you more if you have certain health conditions.

Out-of-Pocket Costs

Be aware that premiums for the same Medicare Supplement plan may differ between insurance companies. Also, note the difference in out-of-pocket maximums. Medical Advantage plans have an annual maximum while Medicare Supplement plans typically do not.

Prescription Drug Coverage

If you want drug coverage, it is recommended that you enroll in a Medicare Advantage prescription drug plan. Medicare Supplement policies do not cover prescription drugs. If you want this coverage, consider enrolling in a stand-alone Medicare Part D prescription drug plan.

Changing Benefits

With Medicare Advantage plans, benefits may change yearly. With Medicare Supplement plans, benefits generally don’t change.


Extras can range from routine dental and vision to alternative medicine packages. Be sure to review your chosen plans for specific details.

You can find more detailed information on the Medicare.gov website. Or contact us to speak with a certified senior market specialist.

*Please note that many additional differences between the two options exist. The list above has been abbreviated to point out a few of the most noticeable comparisons.

Need more help determining if Medicare Supplement insurance is right for you? Check out these additional facts provided by Medicare.gov about Medigap insurance. If you have determined that a Medigap plan is right for you, your next step is to determine which plan is best suited to fit your needs.



You can choose from among 10 versions of Medicare Supplement plans. The chart below can help you understand the differences in benefits for each policy.

In the chart, if a percentage appears, the plan covers that percentage of the benefits. You’re responsible for the rest.

View our guide on choosing the right Medicare Supplement policy for more detailed information.


Plan F & C Availability

The Medicare Access and CHIP Reauthorization Act of 2015 states that, after January 1 2020, insurance companies can no longer sell any Medicare Supplement insurance plan that covers the Original Medicare Part B deductible to newly eligible Medicare beneficiaries. That means, if you joined Medicare on or after January 1, 2020, you cannot purchase a Medicare Supplement Plan F or Plan C. 

Those who were enrolled in Medicare before January 1, 2020 may still apply for Medigap Plan F or Plan C. 


Now you have a basic understanding of the features and benefits associated with Medicare Supplement insurance. If you have determined this form of coverage is right for you and picked a plan that meets your needs, it’s time to shop around.

We make shopping for Medicare Supplement insurance easy with our online Medigap Multi-Quote Tool. All you have to do is fill out a few questions. Then you’ll receive a list of quotes from Cigna, Mutual of Omaha, Sentinel, and many more trusted insurance carriers. Click the button below to get started.

We hope you found this guide to be a comprehensive outline to purchasing a Medicare Supplement plan. If you have any questions about Medicare Supplement insurance, we can connect you to  speak with a licensed senior insurance specialist today.

Updated: 03/16/2020


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