One of the most pressing concerns for people in or near retirement is the rising cost of health care. While you might expect that Medicare will provide all you need, you could be in for shock; out of pocket costs for medical care can be very high even with Medicare. Medicare Supplement Insurance can be a helpful tool to lower or eliminate these expenses. Please read this article to get an overview of Medicare Supplement Plans in North Carolina.
An important factor to keep in mind as you plan your Medicare coverage is that you will experience out of pocket spending when you use Part A and B benefits. Under the terms of Original Medicare, there is no avoiding this. The program was designed so that you will share in some of the costs for your care. While Medicare definitely covers the majority of the cost, what you’ll potentially face can still be expensive. The costs you’ll be responsible for include:
In addition to these specific costs, you’ll also be responsible for the cost of any emergency care you receive outside of the U.S. since Medicare only covers you in the United States.
Note that there is no provision to limit your spending; there are no caps or limits like you’ve probably had with other health insurance coverage. You’re required to keep paying for care regardless of how much you’ve previously spent.This can be a major worry, because the cost under Medicare for treatments like chemotherapy, or long term hospitalization, can add up quickly.
To combat and limit the impact of these costs, you can enroll in a Medicare Supplement (or, Medigap) plan.While Medigap isn’t the only option for reducing your spending (Medicare Advantage is your other option), it is the oldest and most comprehensive solution available today.
Medigap plans are designed to work with your basic Part A and B benefits from Original Medicare. Medigap plans make no changes to your Original Medicare coverage and benefits.Instead,they simply pay for some of the costs that you would normally pay. For instance, when you see a doctor or get other medical care, your bill will be paid by both Original Medicare and your Medigap plan. Medicare remains your primary coverage; it will pay the first 80% of the cost for your Part B services once you’ve met the deductible.Your plan will be billed for the remaining 20%; depending on the level of coverage you selected, your plan will pay most, or all, of the remaining balance.
Medicare Supplement Insurance plans are standardized throughout most of the country. 47 states, plus Washington, D.C., including North Carolina, have adopted ten standardized Medigap plans. Each one of the plans offers a unique benefit structure. The ten plans are designated by letter: A, B, C, D, F, G, K, L, M, and N. Benefits from each plan letter are the same in all of the standardized states; Plan A provides the exact same benefits in Arizona as it does in North Carolina, and the same is true for the other plans.
This standardization feature is really helpful because it allows you to select the level of coverage you’re most comfortable with, and then compare prices from multiple plans. Since the benefits are standardized, you’ll be able to compare apples to apples.
Since Medigap plans merely supplement your Part A and B benefits, they don’t modify your Medicare rights in any way. There are no networks of physicians or referral requirements to consider. You are always able to see any provider in the country that takes Original Medicare as an insurance coverage.
Although both programs involve Medicare benefits, they are two totally separate and distinct coverages. As mentioned before, Medigap is merely an enhancement of your Original Medicare coverage. Medicare Advantage plans are actually an alternative to traditional Medicare. With a Medicare Advantage plan, you are receiving your Medicare benefits through a private insurance company. The Original Medicare system is not responsible for paying your medical claims; your insurance company is.
Medicare Advantage plans almost always have networks of providers. In many cases, you must use the plan’s network in order to receive care.You will often need to get referrals in order to see specialists.
The kinds of costs you’ll pay differs between Medigap and Medicare Advantage.As we saw earlier, Medigap simply steps between you and the provider; it directly reduces how much you pay. With a Medicare Advantage plan, you’ll pay a negotiated price as a co-payment or co-insurance for all of your services and procedures. In this way, Medicare Advantage works like traditional employer or individual health insurance.
While you’ll likely spend more on medical care with a Medicare Advantage plan, you should know that every Medicare Advantage plan has an annual Out of Pocket Maximum (OOPM) limit. This helps you know, in advance, the most you’ll have to pay for care, even if you have a major illness like cancer.
Choosing between these two options is perhaps the biggest decision you’ll make when it comes to your Medicare benefits.They are both solid options and you can’t go wrong with either. However, how much you end up paying, both for coverage in the form of premiums, and for care, in the form of deductibles and co-payments, will be impacted by this choice, so it pays to think about it strategically.
Making a choice between them often comes down to mindset and budgetary considerations.
On the mindset front, people tend to have one of two different thought patterns:
People in the first camp tend to prefer Medicare Supplement Insurance. Those in the other camp often choose Medicare Advantage.
The other consideration is strictly budget related; some people just can’t afford to pay the premiums that come with Medigap plans. People on fixed and limited incomes may have difficulty affording Medigap premiums. The bottom line is that you should choose the option that best fits your budget and gives you maximum peace of mind.
The best time to do this is during your Medigap Open Enrollment Period, which begins when you are BOTH age 65 or older AND actively enrolled in Part B. It lasts for six months. During this period, your enrollment is guaranteed for any Medigap plan available in your area.
This refers to answering medical history questions on a Medigap enrollment application. This only happens when you apply for coverage outside of your six month Open Enrollment Period. In this case, the insurance company considers your health and can either approve or deny your application.
Yes. However, if you apply outside of your open enrollment period, you may be subject to medical underwriting.
No. You will need to enroll in a Part D drug plan in order to get help with your medications.
Do Medicare Supplement Plans cover dental, vision, or hearing?
No. To get help with those services, you should consider adding separate insurance coverage.
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