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Choosing a Medigap Plan

What are Medigap plans and what do they cover?

  • Medigap plans, also called Medicare Supplemental plans, help cover some of the costs Medicare Parts A and B do not cover and you must pay. Medicare generally pays 80% of Medicare covered services.
  • Medigap plans are standardized across the country. They are identified by letters A-D, F, G, K, L, and N. For example, Plan A offers the same coverage in Vermont as it does in all other states.
  • The plans offer different coverage and have different out-of-pocket costs. All must cover certain basic benefits, including some part of hospitalization and medical costs, and cost sharing for Part A eligible hospice and respite care.
  • Medicare supplemental plans do not work with Medicare Advantage plans, which are also called Medicare Part C.
  • The Medicare website explains the differences between all the plans: https://www.medicare.gov/supplements-other-insurance/how-to-compare­ medigap-policies

Who should consider buying a Medigap plan?

  • If you are enrolled in Part A and/or Part B and you want help paying some of the health care costs that Medicare doesn’t cover.
  • You may not need a Medigap plan if you have other health insurance, for example, from an employer, military retiree or employer retiree coverage
  • You do not need a Medigap plan if you are enrolled in Medicaid or the Medicare Savings Program called “QMB”.

What if I cannot afford to buy a Medigap plan?

  • Medicaid can cover some of Medicare’s out of pocket costs. Medicaid has income and resource limits
  • The Medicare Savings Programs have income eligibility limits and can help pay some of Medicare’s costs, including Part B premiums and in some cases deductibles, copayments and coinsurance.

Can I buy a Medigap plan any time?

  • The best time to buy a plan is during your Medigap Open Enrollment Period, which starts the first day of the month when you are both 65 or older and enrolled in Part B.
  • The Medigap Open Enrollment Period lasts for 6 months starting from the day you are both 65 or older and enrolled in Medicare Part B.
  • If you enroll in a plan during this period, the insurer cannot refuse to sell you a plan or charge you more based on your health.

What ifl don’t enroll when I am first able to?

  • If you did not enroll during your Medigap Open Enrollment Period you may not be able to buy a plan or you may have to pay more UNLESS you qualify for a Special Enrollment Period.
  • You may have a Special Enrollment Period if:
    • you have an employer plan that provides supplemental benefits that ends or stops providing some of the benefits,
    • you lose your current Medigap plan because the insurer loses its license or no longer sells plans in your area, or
    • you move.
  • If you qualify for one of these Special Enrollment Periods, the insurer cannot refuse to sell you a plan or charge you more. In most situations, you must enroll in a Medigap plan within 63 days.

What ifl am eligible for Medicare because I am disabled and am not 65?

  • In Vermont, if an insurance company sells Medigap plans to beneficiaries 65 and older, they must also offer the same policies to beneficiaries who are eligible for Medicare because they are disabled.
  • If you did not enroll during your Medigap Open Enrollment Period you may not be able to buy a plan or you may have to pay more UNLESS you qualify for a Special Enrollment Period. If you qualify for a Special Enrollment Period the insurer cannot refuse to sell you a plan or charge you more.
  • Beneficiaries who are disabled and have a supplemental policy before they are 65 have another 6 month Open Enrollment Period when they turn 65.

What about pre-existing condition exclusions?

  • The insurance company cannot exclude coverage of any preexisting conditions if you have “creditable” coverage for at least 6 continuous months if you enroll during your Medigap Open Enrollment Period or if you have a Special Enrollment Period.
  • If you enroll outside of the Open Enrollment or a Special Enrollment Period and did not have creditable coverage the 6 months prior to enrollment,insurance companies can exclude coverage of preexisting conditions-but not for more than 6 months.

Creditable coverage includes employer group coverage, Medicare and Medicaid. It does not include accident or disability insurance, workers’ compensation, coverage for a specific illness or disease or limited scope insurance like dental and vision.

Can the insurance company drop me?

Once you buy a Medigap plan the insurance plan must continue to renew it as long as you pay your premiums on time.

Can I change plans?

  • Yes, you can change plans. However, your options for plans may be more limited depending when you change plans.
  • Do not cancel your current plan until you have enrolled in another plan and decided to keep it.

Where can I buy a policy?

You can buy a Medicare Supplement insurance policy from any insurance company or insurance agent that is licensed in and approved to sell these policies in Vermont.

Insurers approved to sell policies in Vermont include:

Where can I get help?

Choosing a Medigap plan can be complicated. It is important to get answers to your questions before you buy a plan.

  • Call the Helpline at 1-800-642-5119. Ask to speak to a SHIP counselor to answer your questions.
  • The Vermont Department of Financial Regulation regulates supplemental plans and provides information about supplemental plans offered in Vermont.

https:// dfr.vermont.gov /document/medicare-supplemental-insurance-shopping-guide

download this resource as a pdf

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