Answers to Your Medicare Supplement Insurance Questions

Medigap or Medicare Supplement insurance policies help pay some health care costs not covered by the original Medicare plan. You may already have Medicare Supplement insurance, or you may be deciding how to receive prescription drug coverage (see "The New Medicare Prescription Drug Coverage: You Have Options"). Here are answers to some often-asked questions to help determine if a Medicare Supplement insurance policy is right for you.

Q: If I'm already receiving Medicare benefits, why do I need another health insurance policy?

A: Not usually. Under most Medicare supplement insurance policies, you can assign benefits directly to your health care providers, and avoid the burden of receiving bills from numerous Medicare providers.

Q: What are some differences between Medicare Supplement insurance and a Medicare Advantage plan?

A: Medicare Advantage plans (formerly known as Medicare + Choice) are government-sponsored health plan options for people with Medicare. Unlike Medicare Supplement insurance policies that allow you to see any doctor who accepts Medicare, many Medicare Advantage plans require you to see a physician in the plan's network. Some allow you to see any physician, but you may have to pay more or you may have higher cost-sharing. With Medicare Supplement insurance, coverage is guaranteed renewable each year. Companies providing Medicare Advantage plans, on the other hand, have the option to leave Medicare at the end of each year, which means you may have to find another plan. Generally, with Medicare Advantage plans, you'll pay more for health care outside the plan's service area, or it may not be covered. Medicare Supplement insurance policies allow you to see any provider who accepts Medicare.

Q: How does Medicare's new prescription drug coverage affect Medicare Supplement insurance policies?

A: People who have Medicare Supplement insurance policies that cover prescription drugs may keep their policies if they don't enroll in Medicare's prescription drug benefit that begins in 2006. Those who choose to enroll in a Medicare prescription drug benefit plan may keep their current Medicare Supplement insurance policy, but the drug coverage will be removed and the premium will be reduced.

Starting January 1, 2006, no new Medicare Supplement insurance policies offering prescription drug benefits will be sold. To find out more about Medicare Supplement insurance, talk to your agent or check out "2005 Choosing A Medigap Policy: A Guide To Health Insurance For People With Medicare," available free at www.medicare.gov under "Publications." You can also obtain a copy by calling toll free, 1-800-MEDICARE (1-800-633-4227).

1. "Medigap Policy Basics: What is a Medigap Policy?", www.medicare.gov, December 9, 2004

2. "2005 Choosing A Medigap Policy: A Guide to Health Insurance for People With Medicare," Centers for Medicare & Medicaid Services Publication No. 02110, April 2005

3. "Medicare and You 2005," Centers for Medicare & Medicaid Services Publication No. CMS-10050, revised January 2005

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Medicare Supplement and Long-Term Care Insurance: 10 Factors You Should Consider

You probably know by now that Medicare may not cover all your medical expenses. Fortunately, Medicare supplement insurance or Medigap can help ease your worries by filling in some of the holes. Before you buy, however, there are some things you should know:

There are 10 Federally standardized Medicare supplement plans, labeled A-J, sold by private insurance companies. (Massachusetts, Minnesota and Wisconsin have their own plans.) Plan A covers the basics; Plan J offers the most benefits. If you're 65 or older, you can buy Medicare supplement insurance without being rejected for existing medical problems, provided you apply within six months after enrolling in Medicare.

There can be big differences in costs for the same coverage, and even bigger differences in the services provided. Remember, the lowest priced insurance policy isn't always the best choice.

It is illegal for an insurance company to sell you a second Medicare supplement insurance policy unless you put in writing that you are canceling an existing one. An excellent publication called the 1503 Guide to Health Insurance for People with Medicare is available free from Medicare. If you have access to the Internet, go to www.medicare.gov and look under "Publications," or call toll free 1-800-MEDICARE (1-800-633-4227).

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