E.F. Heagen & Associates

(949) 487-6711

Insurance Read Time: 3 min

Understanding the Basics of Medigap Policies

Medicare coverage can be a critical component for living a healthy life in retirement, as well as for maintaining your financial independence during these years. Yet, as important as it is, Medicare does not cover the full range of healthcare expenses you may experience in your golden years.

To fill the holes that exist in Medicare, Medigap insurance can be purchased by individuals over 65 to supplement Medicare.

A Medigap policy is designed to cover expenses such as copayments, coinsurance, and even deductibles—the so-called gaps in Medicare. Coinsurance is only covered after you have paid the deductible unless you select a Medigap policy that also covers the deductible.

From A to N

Medigap is private health insurance that must follow federal and state laws designed to protect you. In most states, you can only purchase standardized coverage packages, or Plans, each of which is identified by the letters A through N.

These standardized packages must offer the same basic benefits regardless of which insurance company is offering it. Cost is usually the only difference between Medigap policies with the same letter.

All insurance companies are required to offer the Plan A standardized package. Each Medigap plan option (A-N) will differ on the benefits offered and the percentage of coverage for these Medicare gaps.

To get a better understanding of what each of these plans offer, go to www.medicare.gov and click on “Health & Drug Plans” at the top of the page. Then click on “What health plans cover.”

An Early Start at 65

You must have Medicare Parts A and B to buy a Medigap policy, and the best time to buy Medigap insurance is within the first six months you are both 65 or older and enrolled in Medicare Part B. By doing this you will not need to undergo a medical underwriting. For those with existing health conditions, this enables them to buy a policy at the same price that is charged for people in good health.

A separate Medigap policy must be purchased for each spouse.

If you are nearing retirement, or have already discovered that these Medicare gaps can be expensive, it may be time to determine if a Medigap policy is right for you.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright FMG Suite.

Share |
 

Related Content

What You Need to Know About Social Security

What You Need to Know About Social Security

Every so often, you’ll hear about Social Security benefits running out. But is there truth to the fears, or is it all hype?

Do You Have Financial Vampires in Your Life?

Do You Have Financial Vampires in Your Life?

Financial vampires can take a lot out of you, are there any in your life?

Insurance Planning Following Divorce

Insurance Planning Following Divorce

If you are recently divorced, take steps to ensure that you are properly protected.

 

Have A Question About This Topic?







Thank you! Oops!

Pickleball in Retirement

Learn about the latest sport to sweep the nation with this informative article.

Gap Insurance for Leased Cars

If you’re thinking of leasing a new car, then you shouldn’t forget about gap insurance.

Term vs. Permanent Life Insurance

When considering life insurance, it's important to understand your options.

View all articles

Home Mortgage Deduction

Use this calculator to assess the potential benefits of a home mortgage deduction.

Federal Income Tax

Use this calculator to estimate your income tax liability along with average and marginal tax rates.

Taxable vs. Tax-Deferred Savings

Use this calculator to compare the future value of investments with different tax consequences.

View all calculators

5 Smart Investing Strategies

There are some smart strategies that may help you pursue your investment objectives

Managing Your Lifestyle

Using smart management to get more of what you want and free up assets to invest.

Your Cash Flow Statement

A presentation about managing money: using it, saving it, and even getting credit.

View all presentations

The Independence of Financial and Emotional Well-Being

Greater financial and emotional confidence brings greater independence. Isn’t that what it’s all about?

The Cost of Procrastination

Procrastination can be costly. When you get a late start, it may be difficult to make up for lost time.

What You Need to Know About Social Security

Every so often, you’ll hear about Social Security benefits running out. But is there truth to the fears, or is it all hype?

View all videos