Obtaining Supplemental Health Insurance Tips
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Who Needs Supplemental Health Insurance
If you are a Medicare recipient or will be Medicare eligible in the near future, you should at the very least consider obtaining supplemental health insurance. Out-of-pocket costs for medical expenses not covered by Medicare can be exorbitant, particularly if you have any chronic conditions. The Medicare Web site has an online tool called the Medicare Personal Plan Finder that helps users find health plan choices available in your area along with a benefit description and other information to help you choose the best supplemental health insurance.
Supplemental Health Insurance
Supplemental health insurance, is basically insurance that is meant to fill in the gap, usually because your current plan does not cover certain services or the co-pays are too high. Obtaining supplemental health insurance is a good way to avoid paying additional out-of-pocket expenses. Types of supplemental insurance available include hospital indemnity plans and supplemental medical plans that come in a range of coverage levels and types. The most common type of supplemental health insurance is what is known as a Medigap plan. These plans are purchased by Medicare recipients to cover the out-of-pocket medical expenses, not covered by the original Medicare plan.
Supplemental Health Insurance Coverage
Obtaining supplemental health insurance can help you cover costs that ordinarily would not be covered. Supplemental health insurance plans cover a variety of expenses depending on the individual plan. For example, a hospital indemnity supplemental insurance plan generally pays fixed cash benefits for covered hospital-related services, including hospital stays. Broader supplemental health insurance plans pay fixed benefits for covered preventive care, including physician visits, lab work, and other services. Some supplemental health insurance plans marry the hospital and outpatient service components into one plan paying benefits for both hospital-related and routine health care services. As with standard insurance, generally speaking the broader the coverage terms, and the higher the benefit, the higher will be the premium. For more information on the nitty-gritty of supplemental health insurance plans, visit AARP's Web site.
Medicare Coverage
Some of the health care services not covered by Medicare include anything not considered medically reasonable and necessary, based on a subjective interpretation! Other items that are not covered by Medicare are:
- Long-term nursing home stays
- Custodial care in a nursing home
- Private duty home care nurses
- Homemaker services
- Routine dental services and dentures
- Routine physicals
- Prescription medications
- Preventive care
- Vision exams and eyeglasses
- Hearing tests and hearing aids
- Routine foot care
- Physician charges above Medicare's approved amount
- Any care received outside the U.S.
As you can see, many of the services not covered by Medicare are the very types of services those individual's who qualify for Medicare are likely to need.
Medigap
Medigap is supplemental health insurance policy purchased from private insurance companies that are designed to fill in the gaps in the original Medicare plan. Medigap policies help cover expenses that a Medicare recipient would normally need to pay out-of-pocket. There are ten Medigap plans in all called Medicare A through Medicare
L. Each plan has a different set of benefits, and all Medigap policies must adhere to federal and state laws. Plan A covers the most basic "core" items, and Plan L would offer more inclusive benefits. However, plans H, I, and J will no longer be open for enrollment as of January 2006. No matter where you live, all Medigap policies must offer the same coverage benefits within a Medigap plan level. Despite the fact that all plan levels must offer identical benefits, you would be surprised at the difference in premiums for this coverage. This is why it is important to comparison shop. One note of caution: Medigap policies do not cover any expenses for your spouse, if married. You and your spouse will need to purchase separate Medigap policies.
You can get a copy of Choosing A Medigap Policy: A Guide To Health Insurance For People With Medicare by visiting http://my.medicare.gov or by calling 800-633-4227.
What are my rights when purchasing Medigap insurance?
Shopping for a Medigap policy in the past used to be difficult experience. Today, there is a list of federal and state regulations that have standardize Medigap practices and provided consumer protections. Some of the more important ones include a Federal law which requires that all Medigap plans, A through L, must cover the exact same things regardless of what company you purchase the plan from and regardless of which state you live in. Other state laws can restrict which of the 10 plans are available for sale in their states.
Of the plans available to you in your state, all must be guaranteed renewable, which means the plans automatically renew as long as you pay your monthly premium on time. Your plan cannot be cancelled, and you cannot be forced to "reapply" for coverage. State and federal law also guarantee that for six months from the time you are at least 65 years old and enrolled in Medicare Part B, you can purchase a Medigap policy of your choice regardless of your health.
By law your insurance company is required to deliver a written copy of the policy within 30 days of purchase. Once you have received the written policy, you are guaranteed a 30-day "free look" period. During that period if you decide you wish to cancel the plan for any reason, you can do so and receive a full refund of any premiums paid. However, if you switch insurance companies, the new company must waive any waiting periods for pre-existing conditions that you met under your old policy. If your new plan has benefits for which you have not met a waiting period under your old plan, a waiting period for pre-existing conditions may be applied to that benefit(s).
It also against the law for an insurance company to sell you more than one Medigap policy unless you provide written notice of your intention to cancel the first policy. This is to avoid scams that separate senior citizens from their money by confusing them with the nuances of the 10 Medigap plans--something that once was a common practice. As for doctors, effective in 1993, doctors are not allowed to charge Medicare recipients more than 15 percent above the amount allowed by Medicare. That means that if you go to a doctor who does not accept Medicare insurance and you receive a service for which Medicare's allowed amount is $100, the doctor cannot charge you more than $115 for that service. These are just a few highlights, but there are more regulations and that apply to Medigap policies.
If you have any questions or suspect you may have been the victim of insurance fraud, contact Medicare at 800-633-4227.
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