Even though Medicare provides healthcare insurance for senior citizens and persons with disabilities at a subsidized fee, there are certain areas that it does not cover, for example, copayment, coinsurance, deductibles, and excess charges. During such circumstances, a Medigap policy is useful since it helps the patient pay for those services.
According to the original Medicare plan, the patient is supposed to reimburse a certain percentage of their healthcare costs to the government or the insurer before they receive treatment. Medigap ensures that the patient does not pay anything while at the hospital – the private insurer disburses the initial costs on behalf of the insured. The plan also covers any additional expenses that the patient might incur while receiving treatment.
Common Medigap Benefits include:
- Medicare Part A coinsurance and hospital costs that extend more than one year.
- Medicare Part B coinsurance or copayment.
- Pays for the first three units of blood an inpatient gets during basic treatment. It is important to note that the private insurance company will only pay for the blood if it was bought by the hospital.
- Medicare Part A hospice care coinsurance and copayment.
- Skilled nursing facility care coinsurance.
- Medicare Part A and B deductibles.
- Medicare Part B excess charges.
- International travel emergencies – up to plan limits.
However, if a patient was to compare Medigap plans from different insurance companies, they would discover that some benefits are not one hundred percent covered. Many Medigap providers only cover eighty percent of travel emergencies.
Since private insurance companies want to make money, what they cover depends on the frequency of the risk and the cost. If the hazard is affordable and common at the same time, the firm stands to gain from the sale of such a cover. The high uptake of the policy will ensure that the insurance company makes maximum profits from premium payouts.
Who is Eligible for a Medigap Plan:
Persons with Medicare part A and part B cover are eligible to apply for a Medigap plan. The amount of premium that one pays will depend on the type of plan – foreign travel emergencies cost more than Medicare part B coinsurance and copayment, insurance company, location, and age. Additionally, the policy only covers one person at a time.
However, not everybody with Medicare is guaranteed a Medigap plan. Private insurance companies will deny you cover for at least six months after your initial application if you have a pre-existing medical condition. In such circumstances, the firm will not pay for any additional expenses arising out of your pre-existing illness. Fortunately, the law forbids private insurers from denying cover after the six month period is over.
A Medigap plan helps reduce healthcare costs by covering deductibles, copayments, coinsurance, and other additional charges. As a result, the patient does not have to pay anything while at the hospital. Although Medigap plans are standardized, states such as Wisconsin, Minnesota, and Massachusetts have distinctive policies.