California Medigap Plans
The Original Medicare Plan pays for many health care services and supplies, but it doesn’t pay all of a person’s health care costs. A Medigap policy is a health insurance policy sold by private insurance companies to fill the “gaps” in coverage under the Original Medicare Plan, like deductibles, coinsurance, and copayments. Some Medigap policies also cover benefits that Medicare doesn’t cover, like emergency health care while traveling outside the United States.
The insurance companies that sell these policies must follow Federal and state laws that protect people with Medicare. The Medigap policy must be clearly identified as “Medicare Supplement Insurance.”
A Medigap policy only works with the Original Medicare Plan. If you join a Medicare Advantage Plan or other Medicare plan, your Medigap policy can’t pay any deductibles, copayments, or other cost-sharing under your Medicare plan.
In all states except Massachusetts, Minnesota, and Wisconsin, a Medigap policy must be one of 12 standardized plans (A – L) so people can compare them easily. Each plan has a different set of benefits. The benefits in any Medigap plan A – L are the same for any insurance company. It’s important to compare Medigap policies, because costs can vary. (Note: insurance companies don’t have to offer every Medigap plan. Each company decides which Medigap policies it will sell and the price for each plan, with state review and approval.)
The best time for a person to buy a California Medigap policy is during his or her Medigap open enrollment period. The open enrollment period lasts for 6 months starting on the first day of the month a person is enrolled in Medicare Part B and age 65 or older. During the Medigap open enrollment period, a person has the right to buy any Medigap policy sold in his or her state. (Some states provide additional enrollment guarantees for people under age 65.)
People may also buy some Medigap policies if they lose certain kinds of health coverage through no fault of their own, e.g., if their employer group health plan coverage ends, if they move out of the service area, or, under certain circumstances, if they leave their Medicare Advantage Plan. People may also buy a Medigap policy any time an insurance company will sell them one, but their health history may be used to decide if they can buy one and how much they have to pay. (Note: People can no longer buy Medigap policies covering prescription drugs because Medicare now offers prescription drug coverage. However, people with an existing policy that covers prescription drugs can keep it.)
People pay the insurance company a monthly premium for their Medigap policy and also pay their monthly Medicare Part B premium ($93.50 in 2007). After they get a health care service, they will get a Medicare Summary Notice showing what Medicare paid, and their Medigap insurance company will send them information on what it paid.