Medicare - Supplemental Health Insurance - Need and Eligibility

There are many items that Original Medicare will not cover under either Part A hospitalization coverage or Part B medical insurance. These include routine care, such as annual medical checkups, eye examinations and corrective wear, dental work, and most immunizations. Items that are not medically reasonable or necessary are also excluded. Examples of these items include cosmetic surgery, private nurses, and personal conveniences. In addition to items that are not covered, Medicare beneficiaries must pay coinsurance, copayments, and deductibles, all of which increase their out-of-pocket costs and create a market for supplemental health insurance.

Medigap policies, which are offered by private insurance companies for a monthly premium, are designed to fill these gaps in Medicare coverage. Depending upon the particular plan purchased, benefits might include at-home recovery after a hospital stay, routine annual checkups, and emergency health care outside the United State. However, not everyone needs a Medigap policy nor is everyone eligible for Medigap coverage.

Who Needs Medigap Insurance?

Medicare beneficiaries, at the time of enrollment, are allowed to choose the type of plan they wish to use. The first type of plan, which is available nationwide, is known as the Original Medicare Plan. The second type is Medicare Advantage Plans, which include managed care plans, preferred provider organization (PPO) plans, private fee-for-service plans, and specialty plans. These plans are not available in some parts of the United States. Only beneficiaries enrolled in the Original Medicare Plan might need supplemental Medigap insurance to help increase their coverage and decrease their out-of-pocket costs.

Examples of items that Medigap policies might help cover include hospital coverage past that provided by Medicare, skilled nursing facility care, the cost of the first three pints of blood, the copayment for medical care rendered under Part B, and the deductible for Part B coverage.

Who Is Eligible for Medigap Coverage?

Medicare consists of two parts: Part A and Part B. Part A provides hospital insurance, including not only inpatient care, but also skilled nursing facility care, hospice care, and some home health care. Part B provides medical insurance, covering doctor visits, outpatient care, some home health care, and some types of therapy. Although everyone eligible for Medicare receives Part A coverage, many elderly Americans choose to pay a premium for optional Part B coverage. Typically, one must be covered under both Part A and Part B to be eligible for a Medigap policy.

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