Some tips on what to look for in supplemental insurance for Medicare.
When a senior becomes eligible for Medicare, learning what it covers should be a priority, because out-of-pocket expenses become your responsibility. Medicare Part A and B will cover 80% of federally approved costs of hospital and general care. This leaves you with the 20% that is not covered. This “gap” is the real cost of your insurance.
Supplemental Insurance for Medicare plans, or Medigap Plans, can help to pay for the expenses not covered by Medicare. The cost will alter your budget, but for some people with long-term illness, can also be helpful. The important thing to remember is this, most basic policies will cover Part A and B preventive services and the first three units of blood, if needed. More services will cost you higher premiums.
Buying your Supplemental Insurance for Medicare policy during the “open enrollment” period, the first 6 months after you initially get Medicare, will save you money because you can avoid medical underwriting for a pre-existing condition. Additionally, premiums are based on one of three criteria, Community-Rated, Issue-Age-Rated or Attain-Age-Rated.
In this plan, the insurance company charges everyone the same rate in their particular pool or area, regardless of age. This is a good plan because it offers consistency and it is predictable.
In this plan, your premiums are based on your age when you bought the policy. The cost of the plan will stay the same as you get older, adjusted for inflation.
This plan offers lower rates when purchased when you are younger, but adjusts as you age, becoming more expensive. The important thing to remember is to research first, then purchase that policy.