What is Medigap Insurance and Do You Need It?

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In this video, I'll explain how Medigap works, how you're responsible for the 20% Medicare won't cover. I'll also provide a case study on someone who needed to get Medigap - but waited too long and was unable too due to a health issue.

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Medicare only covers 80% of your healthcare costs, leaving you with the remaining 20% coinsurance with no out of pocket maximum. The entire 20% is your responsibility and doesn’t reset at the beginning of the year. I’ll tell you how Medigap works to protect you from that 20% coinsurance so you can make informed decisions about your benefits.

So, what is Medigap insurance and do you need it?

Whether or not you need Medigap insurance is a personal decision and definitely an important one as Medicare only covers 80% of your healthcare costs. And because Medicare doesn’t have an out of pocket limit, the remaining 20% can continue to grow leaving you financially vulnerable. And, no one wants to be in a vulnerable position - especially when it comes to your money.

Most people are used to coinsurance. You probably had it at some point. But the main difference between your under age 65 health insurance and Medicare is the out of pocket limit -- which Medicare doesn’t have.

Now, If we take a look at the average person visiting the doctor a Medicare Part B claim might be $100. Medicare pays 80% of that...so, $80 and you pay $20. You might be thinking, “no big deal”. A few doctor visits a year isn't going to break the bank. And that’s true for many people.

But you need to take two things into consideration --

#1 You don’t know what the future holds in terms of your health.
#2 Medicare doesn’t have an Out of Pocket limit.

This is where Medigap insurance comes into play. Medigap is private insurance that’s meant to fill in the gaps of what Medicare doesn’t cover - such as the 20% coinsurance. And, The most popular plans F, G, and N will cover that 20% coinsurance...offering you financial protection and peace of mind.

When you first enroll in Medicare, you get a one time use it or lose it opportunity and it’s called a Medigap Open Enrollment Period.

This is when you can put a Medigap plan in place without answering any health questions or go through medical underwriting.

So, if your Part B effective date is February 1, the Medigap Open Enrollment period allows you to buy a plan and have it begin in Feb, Mar, Apr, May, Jun, or Jul...it’s an important 6 month window, because when it closes -- it can’t be reopened.

Why is that so important? Think back to that 20% coinsurance. If you decide to not add a Medigap plan during your Medigap Open Enrollment period, then you leave yourself financially vulnerable.

And, If you decide to add a Medigap plan later when something happens, it just might be too late.

After 6 month window closes, you have to answer the health questions and get approved by the insurance company’s medical underwriting department. So there’s no guarantee that a policy will be yours. You’ve now put the decision making in the hands of the insurance company.

So, are you still wondering what is Medigap and do you need it? If so, make sure to watch this video.

The good news is you don’t have to make a decision right this very second. In fact, you might want some more information or even some more guidance. So, I have more good news, you don’t have to look very far, because help is right in front of you...hello! Give me a call or send me an email if you prefer and I’ll get your questions answered and help move you through the process.

[rickmoore]

I think you have the clearest explanation of this maze of Medicare/Medigap options.

[retd]

Medicare Advantage has a maximum out of pocket cost of approx $7500 / year. Is there a gap plan to cover this?Thank

[lynnohrel]

You don’t pay 20% of the submitted charges. If a dr accepts Medicare assignment you only pay 20% of the amount they agreed to to accept from Medicare.

[pat]

after i talk to an agent like yourself and find the right plan with a certain company, is the price the same to buy it from you as it would be to buy it directly from the insurance company? thank you

[kenmiller]

Perhaps you should mention that new york has exceptions for medical underwriting and open enrollment.

[JayTomasetti]

Hello again Joanne and thank you for the explanations! These Medigap and Advantage representatives do not get into this much explanation and quite frankly they talk too fast and want to make a deal because they have to move on to the next person. I mean I get it. I wouldn't want their job! It is not only confusing but quite annoying !

I have Medicare A and B and an Advantage Plan. through my Health Provider. I am 66 single and retired. Been retired since Aug 2020. My Advantage Plan has covered just about everything since then but I have not been sick enough to experience a hospital admission or stay. I shudder to think what could come of that. My Drug costs have been affordable.

I am looking at Medigap F, G or N now and would like your input on which could be best for my
personal situation. If I am going to pay anyone for this info I will pay you! Just watching your videos have increased not only my knowledge but my UNDERSTANDING which is of the utmost importance when making these very serious decisions.

I am not done reviewing all your videos but I do want your help so instruct me further.

Thank you for making these videos as these are available to view over and over.

Mickey

[arthursorg]

Why don’t insurance companies offer a stop loss policy? Seems like such a policy with say a $5000 stop loss would offer much less premium than the premium required for plans F, G, or N

[Lazer]

and nobody wants to pay premiums you may never or once or twice either?

[MBihon]

Why the volume is low compared with other videos.

[richstewart]

So, if you are not taking part B because you are still working and covered by employers coverage, you don't need to sign up for medigap insurance? Only after you begin taking part B?

[gwendolynflowers]

None of these plans do nursing homes or long term care?

[peterdo]

What the use of Medigap Insurance if it's not available for people under 65 with medicare?

[pmbilainhumble]

Good information. Thank you. I'm in Law School and we are currently studying Medicare Health Law. I am trying to grasp the different parts of Medicare. Your information was worthy. Thanks

[michaelashcraft]

So, if I want a medigap plan I need to drop my Humana Gold, but, what does medigap cvg. cost?

[JohnBell-whhe]

<<< Not my pic...should I call, Will I be dealing with you or someone else?

[stever]

Ive had medigap for five is there problem with changing companys

[josephlee]

Great explanation of Open enrollment and Medical insurance Underwriting!

[pansfamily]

Actually, the difficult decision is choosing between medigap and Advanced plan. Given the fact that advanced plan has out of pocket maximum and the premium is much lower than the medigap, I think advanced plan is very attractive.

[Remedigap]

Thanks for watching. Still have questions about Medigap...ask them in the comments section below.

[jvolstad]

Do you recommend Medigap coverage for those of us on Tricare?