Many people worry about the cost of Medicare - how much they’ll have to pay for medical care. If you’re one of them, you should consider Medicare Supplement Insurance coverage. These plans are among the most popular options for protecting against high out of pocket spending on Medicare. Read this short guide to learn all you need to know about the costs of Medicare and Medicare Supplement Plans in New Mexico.
The most important information you need to know in order to make a smart plan for your Medicare coverage is how much you will likely pay when you use your benefits. While Medicare does a good job of paying for most of your care, there are a number of costs that you’ll have to pay under Part A and B. These costs include:
The Part A deductible and Part B co-insurance are the largest expenses you’ll likely face. You could potentially pay the Part A deductible multiple times in a year. While that is unlikely to happen, it is certain that you’ll pay 20% of the cost for all outpatient (Part B covered) services after you meet the Part B deductible. These costs can add up throughout the year. Unfortunately, there is no cap or out of pocket spending protection under the terms of Original Medicare. You’ll keep paying all year long, no matter how much you’ve spent. This uncapped liability is one of the biggest concerns people have about Medicare, and a key reason people choose to enroll in a Medicare Supplement Plan.
Medicare Supplement Insurance coverage is provided by private insurance companies. These plans are designed to help you pay for some of the costs that you are normally expected to pay out of pocket. In some cases, Medicare Supplement insurance will cover all of the costs that you’re normally responsible for.
These plans, which are often also called Medigap Plans, have been standardized through federal and state legislation in 47 states, as well as the District of Columbia. New Mexico is one of the 47 standardized states. In New Mexico, there are ten standardized Medigap plans. Each one of them is identified by letter, from A through N. Plans E, H, I, and J are not available to enroll in at this time. Besides this, Plans C and F are only available for people who became eligible for Medicare prior to January 1, 2020.
Every one of these standardized Medigap plans has its own level of coverage, so your protection from out of pocket spending depends on which Medigap plan you choose. Since the plans are all standardized, the benefits for each of them are the same everywhere, no matter which insurance company you use, and no matter which state you live in.
You will end up using both your Medicare card and your Medigap plan card when you see a doctor or other provider. Assuming that you’ve already met the Part B deductible, your provider will bill Medicare 80% of the cost for your Part B services. They will also bill your Medigap plan for the other 80%. Depending on which Medigap plan you chose, you might have to pay some portion of the bill, or your plan may cover all of your share.
Since Medigap plans only provide supplemental coverage (in other words, they don’t provide coverage by themselves, they simply cover some of what you’d normally have to pay), there are no networks of providers to worry about. You can see any doctor in the nation that accepts Medicare patients. There are no referral requirements, either.
There may be ten standardized plans, but some are more popular than others. Since 2017, the most popular Medigap plan has probably been Plan G. Plan G is the most comprehensive plan available to people who become eligible for Medicare after December 31, 2019.
With Plan G, you will be required to meet the Part B deductible each year. Once you’ve met this small deductible, Plan G will cover 100% of your share of cost for the rest of the year. Your out of pocket spending should be less than a few hundred dollars per year with Plan G. In addition to this, Plan G will help pay for emergency services outside of the United States.
Another very popular choice is Plan N. With Plan, you will also have to pay the Part B deductible. In addition to this, you will also have to pay small co-payments in certain cases:
The only other expense you’d have to pay is Part B excess charges. These charges, which can be up to 15% of the Medicare-approved amounts for Part B services, are only charged by providers who don’t accept Medicare’s prices. Since most providers do accept Medicare’s prices, these charges aren’t very common. Since you have a few more out of pocket expenses with Plan N, the premium is lower than for Plan G, which can represent good value for some people, especially since Plan N also covers you outside the U.S.
To be eligible for Medigap enrollment, you need to be enrolled in both Part A and Part B of Medicare. This typically happens when you turn 65 years old. It could occur later than that if you delay taking Part B. In either case, you can apply for your Medigap plan as soon as you’re active in both Part A and Part B. It can be hard to find Medicare Supplement Plans in New Mexico that will enroll people under 65 years old. Insurance companies are not required to give Medigap coverage to people under 65, so the premiums tend to be much higher than for people aged 65 and above.
During your Open Enrollment Period for Medicare Supplement Insurance. This occurs when you are age 65 and older and also active in Part B. It lasts for six months and during this time your acceptance into any Medigap plan available to you is guaranteed.
You may be able to. However, if you apply for your new Medigap plan after your Open Enrollment Period has ended, your application may be declined based on your health history and status.
Yes. You can do this during the Medicare Annual Election Period in the fall of each year.
No. You should also enroll in a separate Part D drug plan to get help with the cost of prescriptions.
No. If you need help with those services, you should consider adding separate coverage for them.
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