888-765-5400Medicare Supplement Policy
During many conversations with prospective and current senior clients, I am often asked a question about the differences between a Medicare Supplement Policy and Medicare Advantage. To answer that question, you first need to understand what Medicare is and how it works. Generally speaking, Medicare is health insurance for people age 65 or older or under age 65 with certain disabilities. It can also be elected by an individual at any age with End-Stage Renal Disease (ESRD) (permanent kidney failure requiring dialysis or a kidney transplant). It helps cover some of the medical services and supplies during inpatient and outpatient hospital procedures, doctor’s visits, and other health care settings. Original Medicare has two parts: Medicare Part A Hospital Insurance and Medicare Part B Medical Insurance.
Medicare Part A is normally a premium-free benefit if you or your spouse paid Medicare taxes while employed. If you paid this tax, you are automatically enrolled in Medicare Part A. It helps cover inpatient hosptial care, inpatient stays in skilled nursing facilities, hospice services, and home health care services. Medicare Part B helps cover medical services such as doctor’s visits, preventive care, outpatient surgeries, and other medical services. Unlike Medicare Part A, there is a monthly premium for Medicare Part B, which happens to be $96.40 for 2009. A Medicare Supplement policy, also referred to as a “Medigap” policy, is private health insurance that can be purchased by eligible individuals on Original Medicare (Part A and B) to help cover some of the gaps that the Original Medicare plan does not cover, such as coinsurance and deductibles. Without a supplement, costs for the portions that Medicare does not pay can be in the thousands of dollars! Both Original Medicare and the supplement policy will pay their share of the Medicare-approved amount for covered services, thus cutting the insured member’s out-of-pocket costs. Supplement policies are sold by private health insurance companies, like Blue Cross Blue Shield North Carolina. To purchase a supplement policy, an individual must be enrolled in Medicare Part A and Medicare Part B. A Medicare Advantage Plan is another way to get Medicare benefits. It is also known as Medicare Part C. These are plans approved by Medicare, but administrated by private health insurance companies, like Blue Cross Blue Shield North Carolina. Unlike a supplement policy, an individual does not purchase a Medicare Advantage Plan to supplement their Original Medicare. In contrast, the individual enrolls in a Medicare Advantage Plan which takes the place of their Original Medicare Plan. Benefits under these plans are often “richer” than Original Medicare as well. They usually include prescription drug benefits built right into the plan. Some plans are premium-free depending on their benefits, but individuals can also purchase extra benefits as well. Regardless if they are premium-free, an individual will always continue to pay their Medicare Part B premium. Plans include, but are not limited to, Medicare PPO’s, HMO’s, and Private Fee-for-Service Plans (PFFS). So, in summary, a supplement plan does just what the name implies – it “supplements” what the Original Medicare Plan does not cover. A Medicare Advantage Plan takes the place of Original Medicare, often with richer coverage. For more information on these policies, please call toll free at 877-359-9250 or CLICK HERE.