Medigap - also called Medicare Supplement Insurance - is private insurance that helps cover some of the costs that original Medicare leaves to you. If you have ever looked at your Medicare Explanation of Benefits and noticed amounts listed as "your responsibility," Medigap is designed to cover some or all of those amounts, depending on which plan you have.
This article explains what Medigap is, how it is structured, and what it does and does not cover.
What is Medigap and what does it do?
Medigap is private insurance that pays some or all of the cost-sharing that original Medicare leaves to you - things like deductibles, coinsurance, and copayments. You pay a monthly premium to a private insurer, and in return, your share of Medicare-covered costs is reduced, sometimes to zero, depending on which plan you have.
Original Medicare (Parts A and B) pays its share of covered services, and then bills the remainder to you. That remainder includes deductibles, coinsurance, and copayments. For some people in some years, those amounts are modest. For people with significant health needs, they can add up quickly - and original Medicare has no annual out-of-pocket cap.
Medigap policies pay some or all of those remaining amounts on your behalf. You pay a monthly premium to the private insurer, and in exchange, your share of Medicare-covered costs is reduced - sometimes to zero, depending on the plan.
How are Medigap plans organized and standardized?
Medigap plans are standardized by the federal government and identified by letters A through N. Every plan with the same letter offers the same core benefits regardless of which insurance company sells it. What varies between companies is the monthly premium, customer service reputation, and availability in your area - not the coverage itself.
One of the most important things to understand about Medigap is that the plans are standardized by the federal government. According to Medicare.gov, Medigap policies are identified by letters A through N, and each plan with the same letter offers the same core benefits regardless of which insurance company sells it.
That means a Plan G from Company A and a Plan G from Company B cover exactly the same things. What varies is:
- The monthly premium the company charges
- The company's reputation for customer service
- Availability in your geographic area
This standardization makes comparison shopping more straightforward than it might seem - once you know which plan letter fits your needs, you are primarily comparing price and company.
Not all plan letters are available in every state, and Massachusetts, Minnesota, and Wisconsin have their own standardized Medigap systems that differ from the federal structure.
What does Medigap cover?
Medigap plans generally help pay for Medicare Part A and Part B cost-sharing, including hospital coinsurance, outpatient coinsurance or copayments, the Part A deductible (on some plans), skilled nursing facility coinsurance, and foreign travel emergency care. The most comprehensive plans leave you with little to no out-of-pocket exposure for Medicare-covered services.
The specific benefits vary by plan letter, but Medigap plans generally help pay for things like:
- Medicare Part A coinsurance and hospital costs
- Medicare Part B coinsurance or copayments
- The Part A deductible (covered by some plans, not others)
- Part A hospice care coinsurance
- Blood (the first three pints, which Medicare does not pay for)
- Skilled nursing facility care coinsurance (covered by some plans)
- Foreign travel emergency care (covered by some plans, up to plan limits)
The most comprehensive plans currently available to new enrollees cover most of these costs, leaving you with little to no out-of-pocket exposure for Medicare-covered services. Less comprehensive plans cover fewer items but typically have lower premiums.
What does Medigap not cover?
Medigap does not cover prescription drugs, long-term care, routine dental, routine vision, hearing aids, or private-duty nursing - regardless of which plan letter you choose. These exclusions apply across all plans. If dental, vision, or hearing coverage is important to you, those needs must be addressed through Medicare Advantage or standalone coverage.
According to Medicare.gov, Medigap plans do not cover:
- Prescription drugs. Medigap has not included drug coverage for plans sold since 2006. If you have Medigap, you need a separate Medicare Part D plan for prescription medications.
- Long-term care. Medigap does not cover extended nursing home stays or ongoing custodial care at home.
- Routine dental care. Cleanings, fillings, extractions, and dentures are not covered.
- Routine vision care. Eye exams for glasses and prescription eyewear are not included.
- Hearing aids or exams. Fitting exams and hearing devices are not covered.
- Private-duty nursing.
These exclusions apply regardless of which Medigap plan letter you choose. If dental, vision, or hearing coverage is important to you, you would need to address those separately - either through a Medicare Advantage plan or standalone coverage.
Are Medigap Plans C and F still available?
Plans C and F are no longer available to people who became eligible for Medicare on or after January 1, 2020. If you were already enrolled before that date, you can generally keep your plan. For people newly eligible for Medicare, Plan G is currently among the most comprehensive options and covers most cost-sharing except the Part B deductible.
Plans C and F were historically the most comprehensive Medigap plans and covered the Part B deductible. However, under federal law, these plans are no longer available to people who became eligible for Medicare on or after January 1, 2020. If you were already enrolled in Plan C or F before that date, you can generally keep it.
For people newly eligible for Medicare, Plan G is currently among the most comprehensive options available and covers most cost-sharing except the Part B deductible.
How are Medigap premiums priced?
Medigap premiums are structured in one of three ways: community-rated (same premium for everyone regardless of age), issue-age-rated (based on your age when you buy and does not automatically increase), or attained-age-rated (based on your current age and typically rises as you get older). The pricing structure affects what you pay long-term and is worth asking about when comparing policies.
Medigap premiums can be structured in different ways depending on the company and state:
- Community-rated: everyone in the plan pays the same premium regardless of age
- Issue-age-rated: premium is based on your age when you buy the policy and does not automatically increase as you get older
- Attained-age-rated: premium is based on your current age and typically increases as you age
The pricing structure can have a significant long-term impact on what you pay over time. A lower premium today with attained-age rating may cost more over a decade than a slightly higher community-rated premium. This is worth asking about when comparing policies.
Getting Help Comparing Medigap Plans
Because the benefits are standardized by letter, comparing Medigap policies is primarily a matter of comparing premiums and understanding which plan letter fits your situation. A SHIP counselor can help you understand the plan letters and what is available in your area at no cost. A licensed independent insurance broker can help you compare premiums across companies.
Find your local SHIP counselor at shiphelp.org or by calling 1-877-839-2675.
Medigap plan availability, premiums, and rules vary by state and change over time. Visit medicare.gov or speak with a SHIP counselor for current information. A SHIP counselor can give you personalized guidance on Medicare options in your area at no cost. Find yours at shiphelp.org.