Buying a Medigap (Medicare Supplement Insurance) Policy

What is a Medigap policy?

How does the Original Medicare Plan work with a Medicare Prescription Drug Plan? A Medigap policy is health insurance sold by private insurance companies to fill "gaps" in Original Medicare Plan coverage. Medigap policies help pay your share (coinsurance, copayments, or deductibles) of the costs of Medicare-covered services, and some policies cover certain costs not covered by the Original Medicare Plan. If you are in the Original Medicare Plan and have a Medigap policy, then Medicare and your Medigap policy will both pay their shares of covered health care costs. Insurance companies can only sell you a "standardized" Medigap policy. These Medigap policies must all have specific benefits.

Generally, when you buy a Medigap policy you must have Medicare Part A and Part B. You or someone on your behalf (like a former employer or union) will have to pay the monthly Medicare Part B Premium (see Your 2024 Monthly Premiums for Medicare for the 2024 amount). You will also have to pay a premium to the Medigap insurance company.

In most states, you may be able to choose from up to 12 different standardized Medigap policies (Medigap Plans A through L). Medigap policies must follow Federal and state laws. These laws protect you. A Medigap policy must be clearly identified as "Medicare Supplement Insurance." Each Medigap Plan A through L has a different set of basic and extra benefits. In Massachusetts, Minnesota, and Wisconsin, plans are standardized in a different way.

It's important to compare Medigap policies because the benefits in any Medigap Plan A through L are the same for any insurance company, but the costs can vary a lot, and may go up as you get older. Each insurance company decides which Medigap policies it wants to sell and the price for each plan (with state review and approval).

Although some Medigap policies sold in the past covered prescription drugs, no new Medigap policies covering prescription drugs are being sold. To cover prescription drug costs, you may want to buy Medicare prescription drug coverage (Part D) offered by private companies approved by Medicare. If you join a Medicare Prescription Drug Plan (Part D), and your Medigap policy covers drugs, you must tell your Medigap insurer to remove the prescription drug coverage from your Medigap policy.

If you and your spouse both want Medigap coverage, you each must buy separate Medigap policies. Your Medigap policy won't cover any health care costs for your spouse.

A Medigap policy only works with the Original Medicare Plan. Medigap policies generally provide some of the same kinds of supplemental coverage as Medicare Advantage Plans. If you join a Medicare Advantage Plan (like an HMO or PPO), your Medigap policy won't work. This means it won't pay any Deductibles, Copayments, or other cost-sharing under your Medicare Advantage Plan. Therefore, you may want to drop your Medigap policy if you join a Medicare Advantage Plan. However, you might not be able to get the same policy back, or in some cases, any policy if you leave the Medicare Advantage Plan. You have a legal right to keep the Medigap policy. Your rights to buy a Medigap policy may vary by state.

If you already have a Medigap policy with prescription drug coverage, you can keep that policy with prescription drug coverage OR join a Medicare Prescription Drug Plan. Keep in mind that Medigap drug coverage is generally not as good as coverage under a Medicare drug plan. You pay all the costs for your Medigap drug coverage, but, if you join a Medicare Prescription Drug Plan, Medicare pays most of the cost for standard coverage. You may have to pay a Premium . Medicare prescription drug coverage may cover more than the drug coverage in most Medigap policies. If you kept Medigap prescription drug coverage and didn't join a Medicare drug plan when you were first eligible, you may have to pay a Penalty if you choose to join later. You can't have Medigap prescription drug coverage and Medicare prescription drug coverage at the same time. See What is Medicare Prescription Drug Coverage for more information about your drug coverage choices.

For more information about Medigap policies, visit www.medicare.gov and view the booklet "Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare," or call 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048.

If you have a limited income, there are programs that might help you pay costs Medicare doesn't cover (see Help for People with Limited Income and Resources).