Medigap plans are health insurance policies that cover things Medicare Part A and Part B do not cover. Every Medigap policy must follow Federal and state laws designed to protect you and the policy must be clearly identified as “Medicare Supplement Insurance.” Government regulations allow Medicare insurance companies to sell standardized Medigap plans, labeled Plan A through Plan N. The policies are sold by private insurance companies and are not officially connected to the government Medicare program. All private insurance carriers who offer a given Medigap plan must offer the same coverage levels; however, insurance carriers compete with each other on customer service, monthly premiums, or other features you may care about.
You can shop for a Medigap plan that suits your personal budget, lifestyle, and health. However, it is important to educate yourself to understand the differences among plans. Once you pick the plan type you prefer, check to see which carriers offer the combination of premiums and other features you care about, such as coverage of pre-existing conditions.
Cost
The cost of a Medigap plan is called the premium. The premium is paid on a monthly basis to the insurance company you choose. Each individual must decide what Medigap plan type (A through N) is best for them, and then choose the insurance company plan that they feel best suits them.
Due to the standardized plan structure of Medigap plans, one might assume that premiums would be consistent for the same plan type from different insurance companies. However, variations in cost of up to 65% can be found. The variations are attributed to different underwriting parameters, operating costs and marketing strategies used by each insurer. So, you should be diligent in checking all of your plan options, knowing their premiums, and ultimately selecting the insurance company that offers the Medigap plan type you are interested in.
