Medicare Supplemental Health Insurance Plans Medigap, Advantage, Medical Savings Accounts
Seniors, you now have more options than ever before, for Medicare supplement plans but along with all these choices comes the burden of understanding the plan benefits and risks. Medicare Supplement or Medigap Plans supplement part A & B Medicare. They help fill the “gaps” (co-insurance) in Medicare coverage for hospitalization, skilled nursing, physicians, laboratory and durable medical equipment, etc.
There are three major categories of supplemental plans to be considered and new variations coming each year. First there are the “old faithful” plans A-J. These are well known plans and faithful because there are no surprises. Every insurance company that offers one of these plans must meet minimum guidelines so that you can easily compare the benefits and costs with certainty.
New categories of plans that have gained momentum in the past couple of years are Medicare Advantage plans. These are lower cost alternatives to traditional plans. Compared to traditional plans, the major differences are higher cost sharing (risk) in the form of co-payments for services including hospitalization, skilled nursing and providers. Beware, plans from one company to another are much more difficult to compare. Even some high priced plans, leave very large gaps in coverage.
Another important difference with Medicare Advantage plans is that your provider must be willing to accept the health plan as payer rather than Medicare. Before selecting a plan like this, be sure that your provider will accept payment by the insurance company, otherwise you will have to find another provider.
The latest option, the Medical Savings Account (MSA) is a no cost variation of the Advantage plans. Medicare will deposit a prescribed amount (currently $1225) into a special savings account for you each year. You can use these funds to pay for qualified medical expenses. If these funds are used up, then you pay out of pocket up to your deductible and then the plan pays 100% of Medicare covered services for the balance of the year. Any unused funds remain and accumulate in your account to be used in future years. This may be a way to accumulate funds for the future while preserving your disposable income today.
With such an array of options to consider, not to mention selecting the right part D drug plan, it would be wise to work with an insurance agent that you really trust. Each year you should review your plans, consider any changes in health and prescription needs to be sure they are still the right fit.
This article was contributed by; All Insurance Matters, 5 Rockingham Road, Windham, NH 03087 (603) 890-0100 www.AllInsuranceMatters.com
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