Medicare alone does not cover co-payments, deductibles, and coinsurance.
Medicare supplement plans, also known as Medigap policies, are medical insurance plans that help to pay for those expenses. Plan A is one of these plans.
Most states require insurance companies that offer supplementary medical plans to offer a Plan A Medicare Plan. Additionally, the policies that they offer are the same in all states. However, the premium cost might differ. Companies that have high premium costs might offer more benefits to their customers.
Medicare Supplement Plan A has the fewest benefits compared to the other Medicare supplement plans. These benefits include:
- 100 percent coverage for Medicare Part A coinsurance payments up to 365 days after your original Medicare benefits finish.
- 100 percent coverage for copayment or coinsurance costs for Medicare Part B
- 100 percent coverage for the first three pints of blood used in a medical procedure
- 100 percent coverage for copayment and coinsurance costs for Medicare Part A
These benefits are different in the states of Massachusetts, Wisconsin, and Minnesota where they apply to all Medicare supplement plans and not just Plan A. In these states, coverage includes:
- Medicare Part A coinsurance for inpatient hospital care (for up to 365 days after original Medicare is exhausted in Massachusetts)
- Medicare Part B coinsurance for medical expenses (20 percent of the Medicare-approved the amount in Massachusetts and Minnesota)
- The first three pints of blood each year
- Part A hospice coinsurance or copayment
- Part A and Part B home health services and supplies cost sharing in Minnesota.
The average monthly premium for Medicare Supplementary Plan A is $360. There are three ways that insurance companies determine the cost of Medigap Supplementary Plans.
- Community rating- This type of rating is not affected by your age. The premiums usually remain the same every month. Though, this does not mean that the premiums will not increase. They might, just for other reasons, such as inflation, and not your age.
- Issue-age- rating- In this case, the premium is determined by your age when purchasing the Medicare supplementary Plan. The premiums are more likely to be lower when you apply at the age of 65 rather than when you are older. The premiums will not increase with your age.
- Attained-age- rating – With this rating, the premiums increase with your age. This can be quite affordable for younger buyers. Older buyers can opt to find a better alternative because of the high premiums.
Different insurance companies use different rating methods. When purchasing a Medicare Supplementary Plan, it is best to be aware of the rating system that a company uses. Additionally, you should find out the benefits that come with the plan so you can get your money’s worth.
Some insurance companies have offers for couples because they have to take two plans, among other discounts, that might make the plan of your choice more affordable. Timing is also a determining factor of the premiums that you will pay.
It is not advisable to apply for a Medicare Supplementary Plan during the open enrollment period. This is because you do not have to have a medical exam, and this might result in a higher premium. The Open enrollment period usually goes for six months. Once you are 65 years old and have applied for Medicare Part B, then you qualify to enroll for Medicare plan during this time.
Another factor that determines the premium cost is the type of the Medicare Supplementary Plan. A high-deductible Medicare plan is likely to cost less than a standard plan. It might be worth considering a Select Plan where you are required to use a particular service provider who is under contract with the insurer.
Choosing a good insurance plan requires that you know what you want to get from the commitment. It is important to get as much information as possible concerning the different Medicare Supplementary Plans offered in your area. Remember that high premiums do not necessarily mean more benefits.
Most Medicare supplementary Insurance Plans are offered by private insurance companies.
These insurance plans are usually for the elderly and people with serious medical conditions. However, a medical condition can prevent you from qualifying to apply for a Medicare Supplementary Plan.
Medicare Supplementary Plan A is the most basic of the ten Medicare Plans. Insurance companies are recommended to start with this offer should they choose to include a Medigap policies product
Medigap Plan A Alternatives
- Plan N – One of the more comprehensive plans, Medigap Plan N is a popular option.
- Plan F – The only plan that covers all the gaps in Medicare, Plan F is the most expensive plan, but also the one plan that requires nothing more out of pocket.
- Plan G – Second only to plan F for coverage, Plan G allows you to know exactly what your liability is each year and is typically less expensive than F.
Medicare Supplement Policies
When you buy a Medigap Policy, it will cover the hospital care expenses that are not Medicare approved by the basic Medicare plan. However, Medigap policies do not cover dental, private nursing, optical or vision care.
There are ten Medigap policies ranging from A to N. All these plans have different coverage. For you to apply for a Medigap policy, you need to have Medicare Part A and Part B. Additionally, a Medigap policy only caters for one person.
It is important to note the difference between a Medigap policy and a Medicare Advantage Plan. A Medigap policy adds on to the original Medicare benefits. A Medicare Advantage plan is a means to acquire Medicare benefits.
You can buy a Medigap policy from any licensed insurance company within your state. If you have a Medicare Advantage plan, you are not allowed to buy a Medigap policy. Furthermore, it is important to note that Medigap policies do not offer coverage for prescription drugs.
The ten Medigap Plans cover 100 percent of hospital coinsurance while likewise offering three other benefits, including coverage for up to three pints of blood, Part B Medicare copayments, and coinsurance for hospice care.
However, Plan K and L only cover 50 percent and 75 percent of these expenses respectively.
Now that you have a general knowledge of Medigap policies let’s talk about Medicare supplement Plan A in particular.
This plan is not to be confused with Medicare Part A. Medigap Plan A covers costs that are to be paid directly outside of Medicare Part A and Part B. Part A is half of Part A and B and covers inpatient hospital care costs.