Understanding Medicare Supplement Insurance
Medicare supplemental health insurance, often called "Medigap," is private insurance sold
under government standards to supplement Medicare Plan B - the part of Medicare that covers
doctor bills, outpatient care and other medical services other than inpatient services. Anyone
who is entitled to Medicare coverage is entitled to Medigap coverage.When you first qualify
for Medicare - either because you have turned 65 or because you have qualified for permanent
disability - you have six months to apply for Medicare supplemental insurance under open
enrollment, which means you cannot be rejected because of your medical history. As with other
private medical insurance, outside the open enrollment period your history of past claims can
be used to deny you a Medicare supplement insurance policy, or to charge you higher rates.
Medicare supplemental insurance pays for things not covered in Medicare billing. Usually the
Medigap coverage kicks in after Medicare has paid its share, but in some cases the Medicare
supplement insurance pays first; your benefits administrator can let you know how that works.
All insurance companies are required to offer identical Medicare supplemental health insurance
policies; they differ primarily in the premiums they charge. Three different methods may be
used to calculate your rates. The first is "issue age." This means that you rate is pegged to
the rate currently charged to people who are the same age you were when you were issued your
policy. Normally that means age 65; if you got your first policy at age 65, under issue age
pricing, at age 75 you will pay whatever premium new applicants age 65 are paying. The
second is "attained age." This is a premium keyed to your current age; it increases as you
grow older. Policies that use attained age to set their premiums may be cheaper to begin with,
but may become more expensive as you get older and can afford them less. The other method is
"no age." These policies do not use age to differentiate policy premiums; everyone covered in
your specific Medicare supplemental insurance plan pays the same rate. Another factor to
note is that Medicare supplemental health insurance policies are not allowed to drop you, as
long as you have paid the premiums and did not lie on your initial application. Some older
Medicare supplemental health insurance plans did not have this provision. If you had a plan
that was issued before 1992 and it does not guarantee renewal, you must switch to a more
current Medicare supplemental health insurance plan. If anyone offers you a Medicare
supplemental insurance plan that does not conform to the set policy variations established in
your state, it is probably not legal. It is not legal, for example, for physicians to require
you to pay certain additional fees in order to be treated under Medicare Part B.
|
