There are a lot of questions about Medicare and the coverage that it provides. It’s a confusing program that has left millions of seniors with confusion about their health care and the services that they cover. While you may not know it, your Medicare Parts A and B don’t pay for all of the expenses that you may encounter. In fact, there are about a dozen different categories that original Medicare doesn’t pay for, and those categories could leave you with some massive bills.
There is nothing that you can do about the rising cost of health care, but there are some ways that you can protect yourself from having your savings account drained. One of the most popular ways to protect yourself is to purchase a Medigap insurance plan. These policies will give you additional coverage and help will in the holes left behind by Medicare.
What Is a Medigap Plan?
Before we look at the specifics of Medicare Supplement Plan B, let’s take a broad view of Medigap plans and how they operate. These additional insurance plans are sold by private insurance companies, and the goal of these plans is to give you additional coverage that traditional Medicare doesn’t.
There are ten different plans that you can choose from, and they are all denoted by a letter of the alphabet, A – N. These policies are standardized by the government, which means that they are going to be identical, regardless of which company you purchase them from.
The older you get, the more money you’re going to spend on medical expenses and health care, and those expenses could quickly drain your retirement savings and turn your retirement dreams into a nightmare, but that’s where these Medigap plans come in.
Because these plans are sold by private insurance companies, the available options and the prices are going to differ depending on where you live and the company that you choose. Because they are standardized, the only difference in companies is going to be the premium amount. It’s easy to see why you should compare dozens of companies before you pick the one that’s going to work well for you.
Medigap Plan B
Now that we’ve looked at the basics of Medicare supplemental plans, we can look at the details of a Medigap Plan B. Each of the available plans is different, and some of them provide more coverage than others. Plan B is one of the most basic plans, which is going to leave more coverage gaps. Because it provides less coverage, they are also going to have cheaper premiums. Plan B is an excellent way to get additional support without paying the larger premiums.
Plan B is going to cover the basic expenses like Medicare Part B copayments and coinsurance fees. This is one category that every Medigap plan is going to pay. It’s not a massive expense, but having those copayments paid for can keep hundreds of more dollars in your pocket depending on how often you go to the doctor.
Another expense that is covered by Medigap Plan B is the first three pints of blood that you get as a hospital inpatient or outpatient treatment. Your traditional Medigap Plan should cover the blood after the first three, which means that the blood will be completely covered if you’re ever in need.
Medigap Plan B will also pay for several Medicare Part A expenses that enrollees would be responsible for otherwise. Supplement Plan B will pay for the Medicare Part A deductible (which you probably wouldn’t be paying otherwise) and Medicare Part A hospital coinsurance for up to 365 days after your Medicare benefits have expired. If you’ve ever spent a night or two in the hospital, you know that it can be an expensive stay. If you’re stuck in the hospital for more than a few days, then it can be a massive bill in the end, but thankfully, your Plan B Medigap policy can offset those bills.
The last portion that your Plan B will pay for is any hospice care coinsurance or copayments. Once again, this would probably be a relatively small fee that you would encounter, but having your Medigap plan cover it is going to keep some extra money in your pocket.
What Plan B DOESN’T Cover
Because Plan B is going to be one of the smaller plans, there are a few key categories that it won’t cover. It’s important to take note of these before you purchase one of these plans.
One of the most notable is the Medicare Part B excess charges. When you go to the doctor and receive a service or treatment, there is a pre-approved amount that Medicare is going to pay for that service. Legally, the doctor is allowed to charge 15% more than that pre-approved amount, and any money above that amount is considered excess charges. Not every doctor or hospital is going to have these excess charges, but if you run into any of them and you have a Medigap Plan B, then you have to pay for these expenses out-of-pocket.
Another key coverage gap with Medigap Plan B is the foreign travel emergency care. If you plan to do a lot of traveling in retirement, then it’s important that you get a supplemental plan that covers foreign emergency care. In the vast majority of cases, a traditional Medicare plan is not going to pay for any of those hospital fees if you’re outside of the United States, which can lead to massive hospital bills and a ruined vacation. If you have a comprehensive Medigap Plan, like a Plan F, then some of these expenses will be covered. None of the plans will pay 100% of it, but you can get some protection.
Deciding Which Medigap Plan Is Right for You
It’s important that you pick the perfect supplemental coverage for you and your healthcare needs. There are several different key factors that you should review before you purchase any Medigap plan.
The first thing that you should do is calculate your budget and decide how much you can spend on supplemental coverage every month. The purpose of your Medigap plan is to protect your savings account, but your insurance plan shouldn’t break your bank every month. Make sure that you get a plan that will fit comfortably in your budget without stretching your finances.
The next thing you should look at is your health and family history. If you’re in poor health or you have any pre-existing conditions that could cost you massive medical expenses, then you should consider investing in a larger comprehensive supplemental plan. On the other hand, if you’re in good health and your family history doesn’t have a trend of poor health, then you could risk buying a smaller plan that leaves more coverage gaps but saves you money.
Open Enrollment Period
After you’ve decided which type of plan you’re going to purchase, you will need to enroll in that plan. That’s easy to do. All you have to do is contact a Medigap agent, and they will take care of the application process for you. It’s a simple process that is similar to purchasing a life insurance policy.
What’s important is the WHEN you apply. It’s vital that you sign up during your Medigap Open Enrollment period. This is a 6-month window that begins the month that you turn 65. During this period, the insurance company can’t decline your application, regardless of how poor your health is or any health problems that you have. During these six months, any Medigap plan that you want to purchase is guaranteed acceptance.
Additionally, if you purchase a Medigap plan during these six months, the company can’t charge you higher premiums, even if you aren’t in great health. After the open enrollment period is over, your application will be treated as a normal application, which means that you could get much higher rates for your coverage. Taking advantage of the six months could save you thousands of dollars.
Final Thoughts – Questions or Concerns?
These Medigap plans are one of the best ways to get additional coverage that Medicare doesn’t offer. While Plan B might not be the best supplemental coverage for you, it’s important that you find the plan that will. I have reviewed all of the options that you can choose from.
If you have any questions about Medigap plans or supplemental coverage, feel free to contact me, or you can contact a Medigap agent. They can answer any of those questions that you may have and ensure that you’ve got all of the information that you need.
