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Almost 25% of Medicare beneficiaries buy Medicare Supplement plans. However, in some states, the penetration rate of Medicare Supplement plans is as high as 51%. Most of Medicare beneficiaries in Texas, buy Medigap plans in Texas to supplement Original Medicare.
On average, Original Medicare covers about half of the healthcare expense. It is not enough to provide comprehensive healthcare coverage. Therefore, it is necessary to fill the gaps in Original Medicare with additional plans to avoid last moment surprises. Medigap plans fill the areas where Original Medicare policy may fall short, such as copayments, deductibles, coinsurance, out-of-pocket limit, emergency care outside the country, and Part B excess charges.
How do Medigap plans work with Original Medicare?
Original Medicare does not cover co-payments, deductibles, and coinsurance. Medigap plans cover these costs and provide benefits to enrollees. Medigap plans supplement Original Medicare. Unlike Medicare Advantage plans, these are not meant to replace Original Medicare.
First, your Original Medicare pays its share for Medicare-covered healthcare costs, and then Medigap policy pays its share.
For example, if you have $5000 Ambulance bill, Medicare Part B will pay 80% of the Ambulance bill, and then your Medigap plan pays for the remaining 20% coinsurance of your $5000 Ambulance bill.
What are the different types of Medigap plans?
There are ten different types of Medigap plans, and each plan is represented by a letter (A, B, C, D, F, G, K, L, M, and N). Each labeled category provides a different level of coverage, but the benefits of each plan within a lettered category remain the same. This means plan C will offer the same benefits in Texas as it is in New Jersey. Therefore, no matter from which company you have purchased Medigap plans in Texas, you will receive the same benefits within the category. But you have to keep in mind; a monthly premium of Medigap plans within the same category may vary from company to company. Therefore, when purchasing a Medigap policy, it is worth to shop around.
What is included in Medigap plans?
As discussed above, each Medigap plan has a different level of coverage. But in general, all Medigap plans cover the following benefits:
• Part A coinsurance and hospital costs
• Part A hospice care coinsurance or copayment
• Part B coinsurance or copayment
• Blood first 3 pints
However, some Medicare Supplement plans also cover Part A and Part B deductibles, skilled nursing facility, foreign travel emergency healthcare costs, out-of-pocket limit, and Medicare Part B excess charges (the amount that a non-participating provider may charge above the Medicare-approved cost for a service).
An important thing to note is Medigap policies do not include Medicare Part D coverage. No Medigap policy covers Medicare prescription drug coverage. If Medicare beneficiaries want Part D drug coverage, they have to enroll in stand-alone Part D plan. Medigap policies also do not cover routine dental care, vision care, hearing aids, and wellness services.
When to apply for Medigap policy?
The best time to sign up for a Medigap policy is during your six months open enrollment period that is six months from the first day of the month of your 65th birthday or within six months of signing up for Medicare Part B. However, you can also buy a Medigap policy outside this window, but there is no guarantee that you will get coverage. You company may refuse to sell you Medigap plan or if you do get covered the rate might be higher.
Who can buy Medigap plans?
Anyone who has Original Medicare (Part A and Part B) can buy a Medigap policy. But Medicare beneficiaries who are receiving Medicare benefits through Medicare Advantage plans cannot buy Medigap policies. It is illegal to sell Medigap policy to Medicare beneficiary with Medicare Advantage plans. A medical beneficiary must have Original Medicare to receive benefits of Medigap plans in Texas. Also, a Medigap policy only covers one person. If you and your spouse both want to buy a Medigap policy, then both of you have to purchase a Medigap policy separately.
These are the few things you need to know about Medigap plans. So choose your Medigap plans in Texas wisely after determining your health needs.