Medigap: A Complete Guide to Supplemental Health Insurance for Medicare

You’ve worked hard to create a stable retirement budget. The last thing you need is an unexpected medical bill throwing it all off track. While Original Medicare covers a lot, it leaves gaps that can lead to surprising out-of-pocket costs. This is why so many people wonder, “why do I need supplemental insurance if I have Medicare?” The answer is simple: predictability. A supplemental health insurance for medicare plan, also known as Medigap, helps cover those gaps. It turns unpredictable expenses into one steady, manageable monthly premium, giving you confidence and peace of mind in your financial planning.

Key Takeaways

Medigap helps manage unpredictable costs: A Medigap plan works with Original Medicare to cover out-of-pocket expenses like copayments and deductibles. This makes your healthcare budget more stable, but remember you’ll still need a separate Part D plan for prescriptions.
Prioritize your one-time Open Enrollment Period: Your best opportunity to buy a Medigap policy is the six-month window that starts when you’re 65 and have Part B. During this time, you have a guaranteed right to purchase any plan, regardless of your health history.
Compare prices, not benefits, for the same plan letter: All Medigap plans of the same letter (like Plan G) offer the same basic benefits. Once you choose a letter, your main task is to compare premiums from different insurance companies to find the best rate for that specific plan.

Do I Really Need Supplemental Insurance with Medicare?

If you’ve started looking into your Medicare options, you’ve probably heard the term “Medigap.” So, what exactly is it? Think of Medicare Supplemental Insurance, or Medigap, as a helper policy that works alongside your Original Medicare benefits. It’s extra insurance you can buy from a private company to help pay for some of the health care costs that Original Medicare doesn’t cover, like copayments, coinsurance, and deductibles.

These out-of-pocket expenses are often called “gaps” in Medicare coverage, which is how these plans got their nickname. Having a Medigap plan can make your healthcare costs more predictable and manageable. Instead of facing unexpected bills after a doctor’s visit or hospital stay, your Medigap policy steps in to cover its share of the costs. This can provide valuable peace of mind, especially if you require frequent medical care. It’s important to remember that Medigap is not a standalone plan; it supplements your Original Medicare coverage, it doesn’t replace it.

How Medigap Works with Your Original Medicare

To get a Medigap policy, you first need to be enrolled in Original Medicare, which includes both Part A (Hospital Insurance) and Part B (Medical Insurance). Once you have Original Medicare, you can purchase a Medigap plan from a private insurance company. When you receive medical care, Medicare first pays its approved amount for the service. Then, your Medigap policy pays its share, which could be your coinsurance, copayment, or deductible, depending on the plan you choose. This process happens automatically between your providers, Medicare, and your Medigap insurer, simplifying the billing process for you.

Medigap or Medicare Advantage: What’s the Difference?

This is a common point of confusion, so let’s clear it up: Medigap and Medicare Advantage are two very different things. You cannot have both at the same time. Medigap plans are designed to supplement Original Medicare. Medicare Advantage plans (also known as Part C) are an alternative way to get your Medicare benefits. They are offered by private companies and bundle your Part A, Part B, and often Part D (prescription drug) coverage into one plan. Because Medigap plans do not work with Medicare Advantage, you have to choose one path or the other.

What Gaps Does Medigap Actually Cover?

The main reason people buy Medigap is to get help with the costs that Original Medicare doesn’t pay for. While Medicare Part A and Part B cover a wide range of hospital and medical services, they don’t cover everything. You’re still responsible for deductibles, copayments, and 20% coinsurance for most services. These out-of-pocket costs, or “gaps,” can add up quickly, especially if you have a serious medical condition. A Medigap policy is specifically designed to help cover costs like these, giving you a safety net against high, unpredictable medical bills.

Coinsurance for Hospital and Skilled Nursing Facility Stays

If you have an extended hospital stay, Original Medicare requires you to start paying a daily coinsurance amount after your 60th day. This cost can quickly become substantial, creating a significant financial burden during an already stressful time. A similar rule applies to stays in a skilled nursing facility, where daily coinsurance kicks in after day 20. Medigap plans are designed to address this exact scenario. According to Medicare.gov, Medigap policies can help cover these costs, including Part A coinsurance for both hospital and skilled nursing facility care. This coverage ensures that a prolonged medical event doesn’t lead to a devastating bill, giving you one less thing to worry about so you can focus on your recovery.

Covering Part B Excess Charges

Here’s a detail that often surprises people: doctors who don’t accept the Medicare-approved amount as full payment can charge you up to 15% more. This is known as a “Part B excess charge,” and you are responsible for paying it out of pocket. While not all doctors bill for excess charges, the possibility can create uncertainty in your healthcare budget. Fortunately, some Medigap plans offer a solution. Certain policies, like Plan G, are designed to cover Part B excess charges entirely. Choosing a plan with this benefit means you won’t have to worry about whether your doctor charges more than the Medicare-approved rate, providing broader protection and more predictable medical expenses.

The First Three Pints of Blood

In most cases, Original Medicare won’t pay for the first three pints of blood you need for a medical procedure or transfusion. If the hospital has to buy blood for you, you are typically responsible for the cost of these initial units. This is another one of those specific “gaps” in coverage that could lead to an unexpected bill. However, all standardized Medigap plans offer a benefit to address this. Every Medigap policy covers the cost of the first three pints of blood. It’s a straightforward benefit that provides a reliable safety net for a very specific, and potentially costly, medical need.

Medigap Coverage: What’s Included and What’s Not?

Medigap plans are standardized, meaning they offer the same basic benefits no matter which insurance company sells them. All plans cover at least a portion of your Part A and Part B coinsurance and copayments. Depending on the plan you select, you can also get coverage for things like the Part A hospital deductible, skilled nursing facility care, and even foreign travel emergencies.

However, it’s just as important to know what Medigap doesn’t cover. These policies generally don’t cover long-term care, vision or dental care, hearing aids, or private-duty nursing. Most importantly, they don’t include prescription drug coverage. For that, you’ll need to enroll in a separate Medicare Part D plan. You’ll also pay a separate monthly premium for your Medigap policy, which can range from around $100 to over $150 for a 65-year-old, depending on the plan and your location.

What Medigap Doesn’t Cover: Prescriptions, Dental, and Vision

While Medigap plans are excellent for covering the “gaps” in Original Medicare, it’s crucial to understand their limits. These policies are designed to work with Part A and Part B, so they don’t cover services outside of that scope. For instance, Medigap policies generally don’t cover routine dental or vision exams, hearing aids, or long-term care services like living in a nursing home. The most significant exclusion, however, is prescription drug coverage. Medigap plans sold today do not include benefits for medications you pick up at the pharmacy. This is a common point of confusion, so it’s worth repeating: your Medigap plan will not help you pay for your prescriptions.

The Importance of a Separate Part D Plan

Because Medigap doesn’t cover prescriptions, you’ll need to get that coverage elsewhere to avoid paying full price for your medications. This is where Medicare Part D comes in. A Part D plan is a standalone prescription drug plan sold by private insurance companies that works alongside your Original Medicare and Medigap policy. Enrolling in a Part D plan is a critical step to ensure you have comprehensive coverage for your health needs, from doctor visits to the pharmacy counter. Without it, you could face high out-of-pocket costs for your prescriptions, which can quickly add up and disrupt your budget. Choosing the right Part D plan is just as important as selecting your Medigap policy, as each plan has its own list of covered drugs and associated costs.

How to Choose the Right Medigap Plan for You

Picking the right Medigap plan can feel like a huge task, but it doesn’t have to be. When you know what to look for, you can confidently compare your options and find a plan that fits your health needs and your budget. The great news is that the system is designed to be straightforward once you understand the basics. By focusing on a few key areas—plan types, coverage features, and cost—you can narrow down the choices and select the best policy for you.

Think of this as your personal roadmap. We’ll walk through the essential steps to help you understand what makes each plan different and how to find the one that offers the right value for your situation.

A Breakdown of Medigap Plans (A-N)

First, it’s helpful to know that Medigap plans are identified by letters, from A to N. Each lettered plan offers a different combination of benefits. While private insurance companies sell these plans, the federal government standardizes what each plan letter must cover. For example, some of the most popular options are Plans G and N because they offer comprehensive coverage. Not every company offers all 10 Medigap plan types, but the ones they do offer must include the same core benefits for that specific letter. This makes comparing them much easier.

Understanding Cost-Sharing Plans: K and L

Plans K and L are a bit different from the others because they involve cost-sharing. This means you’ll pay a percentage of the costs for covered services until you reach an annual out-of-pocket limit, which results in a lower monthly premium. For 2025, Plan K has an out-of-pocket limit of $7,220, and Plan L’s limit is $3,610. Once you meet your plan’s annual limit and the Part B deductible, the plan pays 100% of your approved medical costs for the rest of the year. These plans can be a good option if you want a lower premium and are comfortable with some out-of-pocket spending, knowing there’s a firm cap on your expenses.

How Plan N Uses Copayments

Plan N is a popular choice that strikes a balance between comprehensive coverage and a more affordable premium. It achieves this by using a copayment system for certain services. While Plan N covers 100% of your Part B coinsurance, you will be responsible for a small copay for some doctor and emergency room visits. You might pay up to $20 for an office visit and up to $50 for an ER visit if you aren’t admitted to the hospital. This structure makes it different from a plan like Plan G, which covers those costs completely after the deductible. If you don’t mind paying small, predictable copays when you receive care, Plan N can be an excellent way to lower your monthly premium without sacrificing major medical coverage.

High-Deductible Options for Plans F and G

For those who want protection against major health events but prefer a very low monthly premium, high-deductible versions of Plan F and Plan G are available. With these plans, you must pay for all Medicare-covered costs out-of-pocket until you meet a set deductible, which is $2,870 for 2025. After you’ve paid that amount, the plan kicks in and covers 100% of your costs for the rest of the year. This option is often a good fit for healthier individuals who can comfortably afford the deductible if a serious health issue arises. It’s important to note that High-Deductible Plan F is only available to people who were eligible for Medicare before January 1, 2020.

How to Compare Medigap Plan Benefits

This is where the standardization really helps you. A Plan G from one company provides the exact same basic benefits as a Plan G from another. This means you don’t have to sort through confusing lists of different coverage details between two plans of the same letter. Once you decide which plan letter (like F, G, or N) has the benefits you need, you can focus on the two other important factors: the price you’ll pay in premiums and the insurance company’s reputation for customer service. This simplifies your decision process significantly.

Does Your Medigap Plan Cover You Nationwide?

One of the biggest advantages of Medigap is the freedom it gives you. Unlike some other types of plans, Medigap policies don’t have restrictive networks. If a doctor or hospital accepts Original Medicare, they will accept your Medigap plan, regardless of which insurance company you bought it from. This means you have nationwide coverage and can see specialists or get care anywhere in the U.S. without needing a referral. For many people, this flexibility and peace of mind is a top priority.

Will Medigap Cover You While Traveling Abroad?

If you love to travel or have family overseas, this is a feature you’ll want to consider. Original Medicare generally doesn’t cover you outside of the United States, but some Medigap plans do. Plans C, D, F, G, M, and N all offer a benefit for foreign travel emergencies. This benefit typically covers 80% of your emergency care costs after you meet a small deductible. It’s a valuable feature that can protect you from unexpected medical bills while you’re enjoying your trip.

Comparing Medigap Costs: What to Look For

Since all Medigap plans of the same letter offer the same basic benefits, your final decision often comes down to cost. The monthly premium for the exact same plan can vary quite a bit from one insurance company to another. That’s why it’s so important to compare prices for the specific plan letter you’ve chosen. By shopping around, you can make sure you’re not overpaying for your coverage. An independent agent can be a great resource here, as they can provide quotes from multiple companies at once, saving you time and helping you find the best rate.

Remembering Your Two Monthly Premiums

When you enroll in a Medigap plan, it’s important to budget for two separate monthly payments. The first is the premium for your Medigap policy, which you’ll pay directly to the private insurance company you chose. The second is your ongoing Medicare Part B premium, which you’ll continue to pay to the federal government. Think of it this way: you’re paying Medicare for your primary medical coverage and paying the private insurer for the supplemental policy that fills in the gaps. It’s a common misunderstanding that the Medigap premium replaces your Part B premium, but that isn’t the case. You must pay both premiums to keep your full coverage active.

Understanding Out-of-Pocket Limits

Most Medigap plans don’t have an annual out-of-pocket limit because they cover so many of your costs that a limit isn’t necessary. However, Plans K and L are designed differently. These plans require you to share more of your healthcare costs in exchange for a lower monthly premium. To protect you from catastrophic expenses, they include a yearly out-of-pocket limit. For example, Plan K’s limit is over $7,000, while Plan L’s is over $3,000 (these amounts can change each year). Once you’ve paid that amount in out-of-pocket costs for the year, along with your Part B deductible, the plan pays 100% of your covered services for the rest of the year, providing a crucial financial safety net.

When and How to Enroll in a Medigap Plan

Timing is everything when it comes to enrolling in a Medigap plan. Your age, your current health coverage, and even where you live can affect when and how you should apply. The most important window is your Medigap Open Enrollment Period, which is a one-time opportunity to buy any plan sold in your state without having to answer health questions. Missing this window can make it harder and more expensive to get a policy later on. Understanding your specific enrollment period and rights is the first step toward getting the coverage that fits your life. Let’s walk through the key things you need to know to get your timing right.

Are You Eligible for Medigap?

Before you worry about enrollment windows, let’s confirm if you can get a Medigap policy. The main requirement is that you must have Original Medicare, which includes both Part A (hospital insurance) and Part B (medical insurance). Medigap plans are designed specifically to work alongside Original Medicare to help cover costs like deductibles and coinsurance. If you’re enrolled in a Medicare Advantage plan, you cannot have a Medigap policy at the same time. You would need to switch back to Original Medicare first. You can find more details on Medigap eligibility on the official Medicare website.

Rules for Beneficiaries Eligible After January 1, 2020

If you became eligible for Medicare on or after January 1, 2020, you’ll notice that two of the most well-known plans, Plan C and Plan F, are not available to you. A change in federal law prevents new Medigap policies from covering the Medicare Part B deductible. Since that was a key feature of Plans C and F, they can no longer be sold to newly eligible beneficiaries. If you were eligible for Medicare before 2020, you might still be able to buy one of these plans. For everyone else, Plan G is now the most comprehensive option. It offers the same benefits as Plan F, with the single exception that you must pay the annual Part B deductible yourself.

Eligibility for Those Under 65 with Disabilities

If you are under 65 and eligible for Medicare due to a disability, your access to Medigap plans can be more complicated. Federal law does not require insurance companies to sell Medigap policies to people in this group. Instead, the rules vary by state. Some states mandate that insurers offer at least one Medigap plan to beneficiaries under 65, but the premiums can be significantly higher than for those 65 and older. The good news is that when you turn 65, you get a brand new six-month Medigap Open Enrollment Period. This gives you another opportunity to buy any plan you want with guaranteed issue rights, likely at a much better rate. Because this area is so dependent on local laws, it’s a good idea to check your state’s specific regulations.

Don’t Miss Your Medigap Open Enrollment Period

This is the golden ticket for Medigap enrollment. Your Medigap Open Enrollment Period is a six-month window that starts on the first day of the month you are both 65 or older and enrolled in Medicare Part B. During this time, an insurance company cannot use medical underwriting. This means they can’t refuse to sell you any Medigap policy they offer, charge you more because of your health history, or make you wait for coverage to start. This is your best opportunity to get the exact plan you want, regardless of any pre-existing conditions. It’s a one-time period, so it’s important not to miss it.

What Are Special Enrollment Periods?

Life doesn’t always stick to a schedule. If you miss your initial open enrollment window, you might still have a chance to enroll in or switch Medigap plans through a Special Enrollment Period (SEP). These periods are triggered by specific life events, such as losing your employer health coverage or moving to a new state outside of your current plan’s service area. For example, if you kept working past 65 and had health insurance through your job, you’ll likely get an SEP when you retire and that coverage ends. These situations give you a fresh opportunity to enroll without penalty, and understanding the specific conditions that qualify is key.

What Are Guaranteed Issue Rights (and Why They Matter)?

Guaranteed issue rights are protections that ensure you can buy a Medigap policy without facing medical underwriting. Your six-month Medigap Open Enrollment Period is the most common time you have these rights. However, they also apply during certain Special Enrollment Periods. For instance, if your Medicare Advantage plan shuts down or you move out of its service area, you have a guaranteed issue right to buy a Medigap plan. Knowing your guaranteed issue rights is important because it protects your access to coverage when you might need it most, preventing insurance companies from denying you based on your health.

How State Rules Can Affect Your Medigap Options

While Medicare is a federal program, Medigap plans are regulated at the state level. This means your options and enrollment rules can vary depending on where you live. Some states offer additional enrollment protections beyond the federal requirements. For example, a few states have an annual “birthday rule” that allows you to switch Medigap plans around your birthday without medical underwriting. Other states have different rules for applicants under 65 who are on Medicare due to a disability. It’s always a good idea to check your state’s specific rules to make sure you’re aware of all the opportunities available to you.

How to Manage and Save on Medigap Costs

Understanding the cost of a Medigap plan is a top priority for most people, and for good reason. You want to find a plan that fits your budget without sacrificing the coverage you need for peace of mind. The good news is that you have a lot of control over managing these costs. It starts with knowing how premiums are set, what factors influence your specific price, and where you can find help if you need it.

Think of it like this: the more you understand about the moving parts of Medigap pricing, the more confident you’ll feel when you choose a plan. From comparing insurance companies to looking into financial assistance programs, there are several practical steps you can take to find an affordable policy. It’s also important to know your rights as a policyholder, like the fact that your plan is guaranteed renewable. Let’s walk through what you need to know to keep your Medigap costs in check.

How Are Medigap Premiums Priced?

When you start looking at Medigap plans, you’ll notice that prices can vary quite a bit. A policy might cost anywhere from around $30 to over $200 per month. This wide range exists because premiums are based on many different factors, including the insurance company, the plan type you choose, and even where you live. The key is to remember that the first price you see isn’t the only price out there. By shopping around and comparing offers from different insurance companies for the exact same plan (like Plan G), you can often find a more competitive rate. This is why getting multiple quotes is one of the most effective ways to find a plan that fits your budget.

What Factors Affect Your Medigap Premium?

Several key factors determine the final monthly premium for your Medigap policy. The plan you choose is a big one—a more comprehensive plan like Plan G will naturally cost more than a basic one like Plan A. Your age and location also play a significant role; premiums are often higher for older applicants and can vary based on the local cost of health care. Some other personal factors include whether you use tobacco and your overall health status, especially if you apply outside of your Open Enrollment Period. Finally, each insurance company uses its own pricing method, which is why the same plan can have different prices from one company to the next.

Can You Get Help Paying for Medigap?

If you’re concerned that a Medigap premium might be too high for your budget, please know that help may be available. You can look into programs designed to help with Medicare costs, which can free up room in your budget for a supplemental plan. For example, Medicare Savings Programs (MSPs) can help pay for your Part A and/or Part B premiums, deductibles, and coinsurance. Another program, called Extra Help, assists with paying for your Part D prescription drug plan costs. Checking your eligibility for these state and federal programs is a smart first step if you need financial support.

Exploring Potential Premium Discounts

Beyond just comparing the base price of plans, it’s worth asking about potential discounts. Many insurance companies offer ways to lower your monthly premium, but you often have to ask. For example, you might qualify for a discount if you’re a non-smoker, are married, or if another member of your household is also enrolled with the same company. Some insurers even offer small reductions for setting up automatic bank payments or for paying your premium annually instead of monthly. These discounts can vary quite a bit between companies and may not be available in every state, so it’s always a good idea to inquire about them when you’re getting quotes. Each company decides how to price its policies, which is another reason why comparing your options is so important.

Considering Medicare SELECT Policies

Another way to potentially lower your monthly premium is by looking into a Medicare SELECT policy. These are a specific type of Medigap plan that requires you to use doctors and hospitals within a certain network for your care to be covered. In exchange for this limitation, SELECT policies often come with a lower premium than standard Medigap plans. This can be a great option if the plan’s network includes the providers you already use and trust. However, it’s important to understand the trade-off: if you receive non-emergency care outside the network, the policy may not pay. Just like with any Medigap plan, you will still be responsible for your monthly Part B premium in addition to the premium for your SELECT policy.

How a Licensed Agent Can Help

You don’t have to sort through all of this information on your own. Working with a licensed, independent insurance agent can make the entire process much simpler. An experienced agent can help you compare the specific Medigap plans and prices available in your area from multiple insurance companies. They can answer your questions, explain the differences between plans in plain English, and walk you through the application process when you’re ready. Because they aren’t tied to a single company, they can provide an objective view of your options, helping you find the right balance of coverage and cost for your unique situation.

Getting Free, Unbiased Guidance from SHIP

While a licensed agent can help you compare specific plans and prices, there’s another fantastic resource you should know about for free, impartial advice. It’s called the State Health Insurance Assistance Program, or SHIP. SHIP provides one-on-one counseling to help you understand all your Medicare options, including Medigap. The counselors are highly trained and, most importantly, they are not connected to any insurance company. This means the guidance you receive is completely unbiased and focused on your best interests, not on making a sale. They can help you understand your rights, compare different types of coverage, and feel more confident in your decisions. You can get help with Medicare and locate your local SHIP office on the official Medicare website.

What “Guaranteed Renewable” Means for You

One of the most valuable features of any Medigap plan is that it is “guaranteed renewable.” This is a formal way of saying that your policy cannot be canceled by the insurance company for any reason, as long as you continue to pay your premiums on time. It doesn’t matter if your health changes or how many medical claims you file—your coverage is secure. This provides incredible stability and peace of mind, ensuring that the safety net you’ve put in place will be there when you need it most. Your Medigap insurance will renew each year, protecting you from unexpected gaps in your health care coverage.

Frequently Asked Questions

Do I still need a separate prescription drug plan if I have Medigap? Yes, you absolutely will. Medigap policies are designed to help with your hospital and medical costs under Original Medicare, but they don’t include coverage for prescriptions. To get help paying for your medications, you’ll need to sign up for a standalone Medicare Part D plan. It’s an important extra step to ensure you have comprehensive coverage.

What happens if I miss my Medigap Open Enrollment Period? Missing your initial six-month window can make getting a plan more difficult. After this period ends, insurance companies can generally use medical underwriting, which means they can review your health history. Based on that review, they could charge you a higher premium or even deny your application altogether. While some situations might grant you another chance to enroll, that initial period is your best opportunity to get any plan you want.

If all plans with the same letter are identical, why do the prices vary so much? This is a great question, and it’s where being a smart shopper really pays off. While the government standardizes the benefits for each plan letter, it doesn’t regulate the price. Each private insurance company sets its own premiums based on its business costs and pricing models. This is why you could see two different prices for the exact same Plan G, making it essential to compare quotes from several companies.

Can I switch from a Medicare Advantage plan to a Medigap plan? Yes, it is possible to switch, but the timing is important. You can generally only leave your Medicare Advantage plan during specific times of the year, like the Annual Enrollment Period. When you switch back to Original Medicare, you can apply for a Medigap plan. However, unless you have a special circumstance that gives you guaranteed issue rights, you will likely have to answer health questions to be approved.

Will my Medigap premium increase as I get older? It’s very likely that your premium will go up over time. Most Medigap premiums increase due to inflation and rising healthcare costs. Additionally, some plans are priced based on your age when you buy the policy, while others increase as you get older. It’s a good idea to ask how a specific company prices its plans so you have a clearer picture of what to expect for your budget in the future.