Medicare Supplement Plans (Medigap)
The “Fill in the Gaps” Insurance for Medicare
My father chose to stay on Original Medicare because he wanted the freedom to see any doctor. However, he knew Medicare has gaps—deductibles and a 20% co-insurance with no limit. To cover these gaps, he bought a Medicare Supplement, or “Medigap,” policy. Now, when he goes to the doctor, Medicare pays its 80%, and his Medigap plan automatically pays the remaining 20%. He has almost zero out-of-pocket costs. It’s a secondary insurance that works behind the scenes to make his healthcare costs predictable and manageable.
Medigap: How I Pay Almost NOTHING When I See a Doctor on Medicare
The Predictability of Near-100% Coverage
My aunt has Original Medicare and a Medigap Plan G. Last year, she had a major knee replacement surgery. The total bill was over $40,000. Medicare paid its large share. Her Medigap plan then automatically covered the remaining co-insurance and hospital deductible. The only medical bill she paid for the entire year was her one-time Part B deductible of about $240. Because she pays her monthly Medigap premium, she has the peace of mind of knowing that her medical costs for the year will be almost completely covered, no matter what happens.
Freedom to Choose ANY Doctor: The Power of Original Medicare + Medigap
The Ultimate Healthcare Network
My mom’s top priority in retirement was being able to keep her team of trusted doctors and have the freedom to see any specialist in the country without a referral. That’s why she chose the combination of Original Medicare plus a Medigap plan. With this setup, she can go to any doctor or hospital in the United States that accepts Medicare. There are no restrictive networks. Her Medigap plan simply works alongside Medicare, paying the bills. This freedom of choice is the number one reason people choose the Medigap path over a Medicare Advantage plan.
Medigap Plan G vs. Plan N vs. Plan F: Which is the Best Value Now?
Decoding the Most Popular Medigap Letters
These three plans are the heavy hitters. Plan F was the most comprehensive but is no longer available to new Medicare beneficiaries. Plan G is now the most popular. It covers everything Plan F did, except for the annual Part B deductible (around $240). You pay that one small deductible yourself, and then you have 100% coverage. Plan N is a lower-cost option. It’s similar to Plan G, but you have to pay small co-pays (up to $20) for some doctor visits. For many, Plan G offers the best combination of comprehensive coverage and value.
Understanding Medigap Standardized Plans: Apples-to-Apples Comparison (Mostly)
A “Plan G” is a “Plan G” is a “Plan G”
The federal government standardized Medigap plans, which makes shopping much easier. This means that a Medigap Plan G from Aetna offers the exact same medical benefits as a Plan G from Blue Cross or Cigna. The coverage is identical. This allows you to do a true apples-to-apples comparison. The only differences between the companies will be the monthly premium they charge for that identical plan and their reputation for customer service and rate stability. This standardization simplifies the decision-making process immensely.
Why Medigap Premiums Vary WILDLY for the SAME Letter Plan
The Price for Identical Coverage Can Be Double
Even though a Medigap Plan G offers the exact same benefits from every company, the price can be dramatically different. When I shopped for a plan for my dad, I got quotes for a Plan G from five different top-rated companies. The monthly premiums ranged from $130 a month to over $250 a month for the identical coverage! This is because each company has its own way of pricing risk and setting rates. It highlights the absolute necessity of working with an independent broker who can shop the entire market for you.
The Best Time to Buy Medigap: Your One-Time Guaranteed Issue Window
The Six Months When You Can’t Be Turned Down
There is one, and only one, time when you have a “guaranteed issue” right to buy any Medigap policy sold in your state. This is your Medigap Open Enrollment Period. It’s the six-month window that starts on the first day of the month in which you are both 65 or older and enrolled in Medicare Part B. During this six-month period, an insurance company cannot deny you a policy or charge you more because of any pre-existing health conditions. If you miss this one-time window, you may have to go through medical underwriting later.
Can You Be Denied Medigap Coverage Later On? YES (Outside Guaranteed Issue)
Your Health Matters After Your Initial Window Closes
If you try to buy a Medigap policy after your one-time, six-month guaranteed issue window has closed, you will have to go through medical underwriting. This means you will have to answer a series of detailed health questions on an application. The insurance company can review your medical history, and if you have significant pre-existing conditions, they can charge you a higher premium or even deny your application altogether. This is why it is so critically important to enroll in a Medigap plan during your initial, protected enrollment period when you first join Medicare.
Medigap vs. Medicare Advantage: The Freedom vs. Cost Trade-Off
The Two Philosophies of Medicare
Choosing between Medigap and Medicare Advantage is a philosophical choice. The Medigap route offers maximum freedom and flexibility. You can see any doctor who accepts Medicare, with no referrals needed. This freedom comes at the cost of a higher monthly premium. The Medicare Advantage route offers a lower (often $0) monthly premium and extra perks like dental and vision. The trade-off is that you are restricted to a local network of doctors and often need prior authorization for services. It’s a choice between freedom and cost.
Does Medigap Cover Prescription Drugs? NO (Need Separate Part D)
A Crucial Piece of the Medicare Puzzle
This is a very important point. Medigap policies, by law, are not allowed to include prescription drug coverage. Medigap only covers the “gaps” in your medical and hospital coverage (Parts A and B). To get coverage for your medications, you must enroll in a separate, standalone Medicare Part D Prescription Drug Plan. So, a person on the Medigap path will typically have three cards in their wallet: their Original Medicare card, their Medigap policy card, and their Part D drug plan card.
How Medigap Covers Medicare Part A & B Deductibles and Coinsurance
The Automatic Gap-Filler
Here’s how Medigap works in practice. My mom went to a specialist. The specialist’s office billed Medicare first. Medicare paid its 80% share of the approved amount. The doctor’s office then automatically sent the remaining 20% of the bill to my mom’s Medigap insurance company. The Medigap plan paid that 20% co-insurance directly to the doctor. My mom never even saw a bill. Medigap works seamlessly in the background with Medicare to cover the deductibles and co-insurance that you would otherwise have to pay out-of-pocket.
High-Deductible Medigap Plans (G or F): Lower Premium, Higher Risk?
A Way to Lower Your Monthly Bill
For healthy, financially secure seniors, a high-deductible Medigap plan can be a smart choice. These plans offer the same comprehensive coverage as a standard Plan G, but you must first pay a separate, high deductible (around $2,800 in 2024) out-of-pocket before the Medigap plan starts paying. In exchange for taking on this deductible risk, your monthly premium for the plan is significantly lower. It’s a way to protect yourself from a catastrophic medical year while keeping your fixed monthly insurance costs down.
Does Medigap Cover Care Outside the US? (Plans C, D, F, G, M, N Offer Limited Benefit)
A Small Benefit for Foreign Travel Emergencies
While Original Medicare provides no coverage outside the U.S., some Medigap plans do. The most popular plans—F, G, and N—include a foreign travel emergency benefit. It’s not a comprehensive travel plan, but it provides a good safety net. These plans will typically pay 80% of the cost of emergency care received in a foreign country after you’ve paid a small deductible. The benefit is usually limited to the first 60 days of a trip and has a lifetime maximum of $50,000. It’s a valuable perk for international travelers.
Switching Medigap Plans: Can You Do It Easily? Not Always.
You Usually Need to Go Through Underwriting Again
Unlike Medicare Advantage plans, which you can switch every year, switching Medigap plans can be difficult. If you are outside of your initial guaranteed issue window, you will have to go through medical underwriting to switch from one Medigap plan to another, or from one company to another. If your health has declined, you may be denied the new coverage. Some states have specific “birthday rules” that allow you to switch plans around your birthday, but for most people, the plan you choose initially is the one you will have for a long time.
Medigap Pricing Methods: Community-Rated vs. Issue-Age vs. Attained-Age
How Your Premium Will Change Over Time
Insurance companies use three methods to price Medigap plans. Community-rated means everyone in the area pays the same premium, regardless of age. Issue-age rated means your premium is based on your age when you buy the policy and won’t increase just because you get older (it can still increase for inflation). Attained-age rated is most common; your premium starts low but increases as you age. Understanding which pricing method a company uses is key to predicting your future costs. Issue-age or community-rated plans are often a better long-term value.
Finding the Best Medigap Rate in Your State: Comparison Shopping is KEY
The Most Important Step in Buying a Plan
Since all Medigap plans with the same letter offer the exact same benefits, the only differentiating factor is price. The most important thing you can do is to shop the market thoroughly. You should work with an independent broker who can provide you with a full list of the premiums for your chosen plan (e.g., Plan G) from all the different insurance carriers in your state. Choosing the lowest-priced plan from a financially strong, A-rated company can save you over a thousand dollars a year in premiums.
My Experience Helping Parents Choose a Medigap Plan
A Process of Education and Comparison
When my parents turned 65, I helped them navigate the Medigap maze. First, we confirmed they wanted the freedom of Original Medicare. Then, we decided that Plan G offered the best value, providing comprehensive coverage with just one small deductible. Finally, I contacted an independent broker who sent us a spreadsheet with the monthly premiums for Plan G from eight different A-rated companies. We chose the one with the most competitive price and a history of stable rates. The process was logical and led to a confident decision.
Why Plan F Isn’t Available to New Medicare Beneficiaries (And Why Plan G is Popular)
The “First Dollar” Coverage Rule Change
For many years, Plan F was the most popular Medigap plan because it covered everything, including the Part B deductible. This was called “first-dollar” coverage. A federal law change in 2020 eliminated this for new Medicare beneficiaries, arguing that it encouraged overuse of services. So, anyone who became eligible for Medicare after January 1, 2020, cannot buy Plan F. Plan G is now the most comprehensive option available. It is identical to Plan F in every way, except that you must pay the annual Part B deductible yourself.
Do Medigap Plans Have Networks? NO – Any Doctor Accepting Medicare Works.
The Definition of “Freedom of Choice”
This is the ultimate benefit of the Medigap route. Medigap plans do not have provider networks. If a doctor, hospital, or specialist accepts Original Medicare, they must also accept your Medigap plan, regardless of which insurance company issued it. You do not need a referral to see a specialist. This gives you the freedom to see virtually any doctor in the entire country, providing unparalleled access to care and the ability to get second opinions from the best medical centers.
Paying for Medigap: Is the Higher Premium Worth the Predictable Costs?
A Budgeting and Peace of Mind Decision
The Medigap path involves higher fixed costs. You will pay your monthly Part B premium to the government, your monthly Medigap premium to the insurance company, and your monthly Part D premium for drug coverage. This might total $300 to $400 a month. However, in exchange for this fixed cost, your medical expenses for the rest of the year are virtually zero. For many retirees on a fixed budget, paying a higher, predictable monthly premium in exchange for almost no unpredictable medical bills provides incredible peace of mind and makes budgeting much easier.
Medigap: The Gold Standard for Comprehensive Medicare Coverage (If You Can Afford It)
The Bottom Line
For those who can afford the monthly premiums, the combination of Original Medicare and a robust Medigap plan (like Plan G) is considered the gold standard of health coverage for retirees. It provides comprehensive coverage with very little out-of-pocket cost and, most importantly, the complete freedom to choose your doctors and hospitals anywhere in the country. It eliminates the hassles of networks, referrals, and prior authorizations that are common with Medicare Advantage plans. It offers the highest level of flexibility and predictability available.