Medicare Supplement Plans

Medicare Supplement Plans

Medicare supplement plans are a great way to help cover some of the costs not covered by Medicare. However, there are many different options available, and it can be confusing trying to figure out which plan is right for you.
Let’s review what Medicare supplements are, how they work, and what each plan covers.

What Is a Medicare Supplement Insurance Plan?

A Medicare supplement plan is one way Medicare beneficiaries can supplement their coverage under Original Medicare (Parts A and B). Also called Medigap plans, these policies are secondary to your Original Medicare benefits.
Medicare supplements were designed to help pay for the expenses that remain after Parts A and B have paid their portions. A Medicare supplement can pay for deductibles, copays, and coinsurance amounts.
While Original Medicare offers great benefits, gaps in coverage can cause medical bills to pile up quickly. In addition, unlike other health insurance you might be accustomed to, Medicare does not limit your out-of-pocket expenses.

How Do Medicare Supplements Work?

One thing to understand is that Medicare supplements are standardized, which means that their benefits remain the same from one year to the next and from one insurance company to the next. Plan G is Plan G, no matter who you purchase it from. The only difference is the premiums set by the carrier.
Premiums are set based on your plan, the insurance carrier you choose, and then personal factors like your location, gender, age, tobacco use, and other health factors. Most insurance companies use the attained-age pricing method, which means that the policies will increase as you get older. Other things that may cause your premiums to increase are the cost of healthcare and general inflation.

What Do Medicare Supplements Cover?

To get a true picture of what Medicare supplements cover, you need to understand your costs with Original Medicare alone.

Your Costs with Medicare Part A

Part A is your hospital insurance, and you’ll use it anytime you get admitted to the hospital. Before Part A begins to pay for anything, you’ll need to pay the $1556 deductible. (That’s the deductible as of 2022, but it typically increases each year.) The Part A deductible applies to each benefit period. A benefit period begins when you’re admitted and ends after you’ve been hospital-free for 60 consecutive days. So, you could be responsible for the Part A deductible multiple times in one year.
After you meet the deductible, your coinsurance costs will depend on how many days you’ve been in the hospital. Part A pays for the first 60 days. From day 61 to 90, your coinsurance responsibility is $389 per day. After day 90, you’ll be responsible for the entire cost out-of-pocket unless you have any of your 60 lifetime reserve days to use. If you do, your coinsurance responsibility is $778 per day. Like the deductible, these numbers change each year.
Benefits for a skilled nursing facility stay are similar but have different coinsurance amounts. Part A will pay for the first 20 days. From day 21 to 100, your coinsurance responsibility is $194.50.

Your Costs with Medicare Part B

Part B is your outpatient insurance, and you’ll use it for visits to your doctor, surgeries, lab work, durable medical equipment, and many preventive services. Part B has an annual deductible of $233 as of 2022. After the deductible has been met, Part B operates on an 80/20 split. Medicare pays 80%, and you pay 20%.
Remember, there is no annual out-of-pocket maximum for either Part A or Part B.
Now that you’re familiar with the costs associated with Parts A and B let’s discuss how a Medigap plan can help you pay for those remaining expenses.

Medicare Supplement Plan Options

There are ten Medicare supplements on the market today: Plans A, B, C, D, F, G, K, L, M, and N. In addition, Plans F and G also have high-deductible options. While all of these can be a good way to have additional coverage, we’ll discuss the most popular Medigap plans: F, G, and N.

Plan F Coverage and Benefits

Medicare Plan F offers more benefits than any other Medigap plan. However, due to changes in legislation, the only Medicare beneficiaries who are eligible for Plan F are those who turned 65 prior to January 1, 2020.
Keeping all those Part A and Part B costs in mind, let’s review what’s included in Medicare supplement Plan F.
●      Part A deductible
●      Part A coinsurance, plus 365 additional lifetime reserve days
●      Skilled nursing facility coinsurance
●      Hospice coinsurance and copays
●      First 3 pints of blood
●      Part B deductible
●      Part B coinsurance and copays
●      Part B excess charges
●      Foreign travel emergency (up to specified limits)
To sum up the benefits more concisely, Plan F pays all costs that remain after Parts A and B have paid their share. As a result, individuals with Plan F have virtually no out-of-pocket expenses.

The Cost of Medigap Plan F

Since Plan F offers more benefits than other Medicare supplements, it also comes with a higher price tag. A Humana Medigap Plan F averages $153 per month. However, premiums are based on several factors. For example, your premium will depend on your location, age, gender, tobacco use, and which insurance carrier you choose.

Plan G Coverage and Benefits

Plan G is nearly identical to Plan F, with one small difference. Plan G does not pay the Part B deductible. Coverage under Plan G includes:
●      Part A deductible
●      Part A coinsurance, plus 365 additional lifetime reserve days
●      Skilled nursing facility coinsurance
●      Hospice coinsurance and copays
●      First 3 pints of blood
●      Part B coinsurance and copays
●      Part B excess charges
●      Foreign travel emergency (up to specified limits)
Anyone with Parts A and B can apply for Plan G. There are no age limitations as there are with Plan F.

The Cost of Medigap Plan G

Individuals who have Plan G enjoy lower premiums than those with Plan F. The average Humana Plan G is approximately $125 per month. Many of our clients find that the amount they save in premium with Plan G often outweighs the one missing benefit (the Part B deductible). As long as your total annual premiums are at least $233 less with Plan G, it’s actually the better option.

Plan N Coverage and Benefits

Plan N is the fastest-growing supplement on the market. Plan N coverage includes:
●      Part A deductible
●      Part A coinsurance, plus 365 additional lifetime reserve days
●      Skilled nursing facility coinsurance
●      Hospice coinsurance and copays
●      First 3 pints of blood
●      Part B coinsurance
●      Foreign travel emergency (up to specified limits)
As you can see, the difference between Plan N and Plan G is that Plan N does not pay the Part B excess charges. An “excess charge” is an amount that your provider charges above the amount set by Medicare. Most providers accept Medicare assignment, which means they accept their fees. For this reason, Part B excess charges are rare, and many beneficiaries don’t notice this reduction in Plan N’s coverage. In addition, some states do not allow Part B excess charges.
The other difference with Plan N is that you will have some copays. Your copay for a doctor’s visit can be up to $20, and an emergency room visit can be up to $50. Some providers have lower copays. Also, if you get admitted to the hospital following an emergency room visit, your copay is waived.

The Cost of Medigap Plan N

Beneficiaries have more out-of-pocket expenses with Plan N, but it has significantly lower premiums. The Humana Medicare supplement Plan N averages $98 per month. Another great thing about Plan N is that as this time, it is experiencing low rate increases. Some states have not seen a rate increase in the last two or three years.

When Can I Enroll In a Medicare Supplement Plan?

You can enroll in a Medicare supplement at any time, as long as you have Medicare Parts A and B in place. That being said, some times are better for enrollment than others.

Initial Enrollment Period

You can enroll in a Medicare supplement plan during your unique Medicare Initial Enrollment Period or IEP. Your IEP is a seven-month window that occurs around your 65th birthday. It begins three months before your birthday and ends three months after your birthday. For example, if your birthday is on April 20th, your IEP begins on January 1 and ends on July 31.
You will enroll in Medicare Parts A and B during your Initial Enrollment Period. (You are automatically enrolled if you’re already receiving Social Security benefits.) Once you have applied for A and B, you can enroll in a Medicare supplement plan.
Your Initial Enrollment Period is the best time to enroll in a Medicare supplement. The reason is that, during this time, you’ll have guaranteed issue rights. Guaranteed issue rights give you guaranteed approval for the supplement of your choice. You will not have to answer any health questions or undergo medical underwriting before being approved for one of these plans. In addition, the insurance company cannot charge you higher premiums based on your health conditions.
For most people, the only time they’ll have guaranteed issue rights is during their Initial Enrollment Period. However, some states allow you to change plans without medical underwriting at other times of the year, usually around your birthday.

Special Enrollment Period

Not everyone will qualify for a Special Enrollment Period or SEP. You must have a qualifying life event to enroll in Medicare during an SEP. If you do qualify, an SEP can happen at any time but will still be limited to a window of time around the qualifying event.
The most common reason our clients qualify for a Special Enrollment Period is when they continue working past the age of 65 and wish to delay Medicare enrollment because they have an employer-sponsored group health plan. Since you must pay a premium for Medicare Part B and any supplemental policy, many choose to delay enrollment if their employer pays for all or some of their group policy.
One important thing to note is that your group plan must be considered “credible” coverage. If it’s not and you still postpone Medicare enrollment, you will pay a penalty when you decide to enroll. For an insurance plan to be deemed credible, it must offer at least as much coverage as Medicare Parts A and B. Any employer who has at least 20 employees has credible coverage. Smaller employers can have credible coverage as well, but you should check with your HR department to be sure.
If you do qualify for an SEP due to having other credible coverage, you will have an 8-month window to apply for Parts A and B, as well as a Medicare supplement. The window ends eight months after your employer-sponsored plan ends. However, even though you have eight months to enroll, you should enroll in the first two months to avoid a Part D penalty.
As with your Initial Enrollment Period, you can apply for a Medigap policy during your SEP and have guaranteed issue rights to a plan. However, you may only have guaranteed issue rights to some plans depending on your state.

General Enrollment Period

If you missed your Initial Enrollment Period and did not qualify for a Special Enrollment Period, the next time you will be eligible to apply for Medicare and a Medicare supplement is during the General Enrollment Period.
The GEP happens each year from January 1 to March 31. You can enroll in Original Medicare and a Medicare supplement insurance plan during this time. However, your effective dates for either of these policies will not start until July 1. In addition, if you enroll during the GEP, you’ll likely be paying a late enrollment penalty for Part B and Part D. (There are no penalties associated with Medicare supplement plans.)
You will not have guaranteed issue rights during the General Enrollment Period, so you must pass medical underwriting to qualify for a Medigap plan.

What Is Not Covered by a Medicare Supplement Plan?

Medigap plans do not cover any services not covered by Parts A or B. Therefore, if Parts A and B deny coverage for a service or procedure, your Medigap plan will also deny coverage. Services not included in Medicare benefits include long-term care, private duty nursing care, routine dental, vision, and hearing services, prescription drugs, and cosmetic surgeries.
Medicare beneficiaries who enroll in a Medicare supplement plan will also need to enroll in a Part D prescription drug plan. Failure to do so will result in late enrollment penalties.
Since neither Original Medicare nor Medigap plans offer benefits for dental, vision, or hearing care, many people choose to enroll in a separate policy for those benefits. You can get coverage for all three services in one Dental, Vision, Hearing (DVH) policy.

How Do I Choose a Medicare Supplement Plan?

Now that you have a basic understanding of Medicare supplements, you are well on your way to making a good decision about your healthcare coverage. Still, it might (and should) take you some time to decide which plan is best. Don’t rush this decision because once you are enrolled in a policy, it may be difficult to change plans in the future.
To decide which supplement plan is best for you, you’ll have to compare coverage and premiums. Do you have health problems that could cause lots of medical expenses? Or do you relatively healthy and rarely see a doctor? How much can you afford in premiums?
When you decide which plan is right for you, you’ll need to pick an insurance carrier and submit your application. Remember, each plan is the same across insurance companies, so it’s important to shop around for coverage to get the most competitive rate.


Medicare is not simple to understand. It has many moving parts and can be confusing to everyone. The good news is CoverMile has licensed insurance agents that specialize in Medicare. Our agents will take the time to get to know you and your personal needs, then help you choose the Medigap plan that makes the most sense for you.
Don’t hesitate to reach out! Our consultations are completely complimentary. Call us today to schedule your appointment.