Basic Concepts of Medicare
Laying a Solid Foundation | Lesson 6

Medicare Supplement or Medigap

In our lesson on Original Medicare, we mentioned there were some things that it didn’t cover.

Medicare Supplement, or Medigap, is an additional coverage option that aims to fill the gaps in Original Medicare.

Those “gaps” are the out-of-pocket exposure beneficiaries face with Original Medicare coverage.

Medicare Supplement plans are sold by agents and provided through insurance companies.

Coverage options are standardized and usually categorized by letter options. Medicare Supplement plans with the same letter offer the same benefits from carrier to carrier and in almost all states.

Plans with different letters offer different benefits.

Options are only standardized differently in a few states where the plans can be changed without federal approval.

But because of standardization, comparing options from carrier to carrier largely comes down to comparing the premium price.

Carriers can offer additional value for their plan options with premium discounts or added services like telehealth, or gym membership discounts.

The standardization options essentially create a spectrum of coverage choices, varying from high premium plans that cover the most out-of-pocket costs on Original Medicare, to lower premium plans that cover less out-of-pocket costs on Original Medicare.

How do all of these coverage combinations work or not work together? That’s in our next lesson. See you there!

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