Medigap: Plugging the Holes in Medicare

Most people automatically qualify for Medicare when they turn 65. Medicare is currently the single-largest payer for health care services in the United States, providing health insurance coverage to more than 67 million Americans, about 90 percent of whom are seniors.

While Medicare covers many essential health services, it doesn’t cover everything. With its deductibles, copayments, and coverage exclusions, Medicare pays for only about half of the medical costs of America’s senior citizens.

Much of the balance not covered by Original Medicare (Parts A and B) can be covered by purchasing Medigap insurance. These policies are designed to “fill the gaps” in coverage left by Medicare, helping to manage out-of-pocket costs. To choose a Medigap plan that best suits your individual needs and budget, it’s important to understand these policies’ benefits and limitations.

What Is Medigap?

Before Medicare, many older Americans lacked adequate health insurance because the market at the time was primarily linked to employment. Even with Medicare, however, which pays for hospital care, doctor visits, and other medical services, seniors faced coverage gaps.

Original Medicare, for example, does not cover services like dental, vision, prescription drugs, or long-term care. Beneficiaries must pay deductibles, copayments, and coinsurance, and there are no limits on out-of-pocket spending.

As health care costs increased over the years, many people found it challenging to manage the unpredictable and sometimes high costs not covered by Medicare. The Baucus Amendment, enacted in 1980, allowed private insurers to offer supplemental insurance to fill Medicare’s gaps. This led to the development of Medigap plans, also known as Medicare Supplement Insurance plans.

Medigap vs. Medicare Advantage

Medigap and Medicare Advantage both supplement Original Medicare, but they are not the same.

Medicare Advantage replaces Original Medicare entirely with a private plan that offers the same coverage—and often additional benefits like vision, hearing, and dental services. Medigap, conversely, supplements out-of-pocket costs not covered by Original Medicare.

You cannot have both a Medigap policy and a Medicare Advantage plan; you must choose one or the other.

Medigap Plans 2025

Medigap policies are standardized. No matter where you live or which insurance company you buy a policy from, policies with the same letter offer the same benefits.

• Most states offer 10 types of Medigap plans named by the letters A-D, F, G, and K-N (Medicare’s website offers a chart summarizing these options).
• If an insurance company sells Medigap, it doesn’t have to offer every Medigap plan, but it must offer at least Medigap Plan A.
• To offer more policies, an insurer must offer either Plan C or Plan F to people who were eligible for Medicare prior to January 1, 2020, but haven’t enrolled yet.
• Although 10 plans are available, plans C, F, E, H, I, and J are no longer available to new Medicare enrollees. If you are already enrolled in one of these plans you can keep it.
• If you turned 65 on or after January 1, 2020, you can’t buy Plans C or F.
• You may be able to buy Plan C or F if you were eligible for Medicare before January 1, 2020, but not yet enrolled.
• Enrollees new to Medicare on or after January 1, 2020, can buy Plan D or G instead of Plan C or F.

When You Can Enroll

According to Medicare.gov, the best time to buy a Medigap policy is when you enroll in Medicare, during your Medigap Open Enrollment Period. This is the six-month period that starts the first day of the month in which you turn 65 years old and sign up for Medicare Part B.

• During this period, you can buy any Medigap policy sold in your state, enroll without being denied coverage due to preexisting health conditions, and generally get better prices and more policy choices.
• The Medigap Open Enrollment Period does not repeat every year, like the Medicare Open Enrollment Period. After this period, you might not be able to buy a Medigap policy. If you can buy one or want to switch plans later, it may cost more.
• You might be able to buy a Medigap policy outside of your Medigap Open Enrollment Period in limited situations if you have protections called “guaranteed issue rights.” In these situations, which typically arise when you lose insurance coverage or your coverage changes, insurers must sell you certain Medigap policies, cover your preexisting health conditions, and can’t charge you more because of health problems.
• Your Medigap policy generally starts the first day of the month after you apply, but you can choose when you want your plan to start.
• You cannot buy more than one Medigap policy. By law, it is illegal to hold multiple Medigap plans at the same time and for insurers to sell more than one plan to the same beneficiary.
• If you want to change your Medigap plan, you must cancel your current plan before purchasing a new one, except during your initial six-month open enrollment period or when you have a guaranteed issue right.
• Federal law does not require that Medigap policies be offered to people under age 65 who enroll in Medicare Part B (i.e., those who enroll due to disability), although state requirements for SSDI recipients and Medigap plans vary.

Learn more about the Medigap Open Enrollment Period and guaranteed issue rights at Medicare.gov.

What Medicare Supplement Plans Cover

Each Medigap plan package has a different combination of benefits ranging from basic to comprehensive, allowing you to choose what’s right for you.

Each package is the same across insurance companies. That means, for example, that a G package from one insurer will be identical to a G package from another company.

The more Medigap coverage you purchase, the more you’ll pay in premiums. But all Medigap policies must provide at least the following core benefits:

• Coinsurance for days 61 to 90 of a hospital stay
• Coinsurance for days 91 to 150 of a hospital stay (lifetime reserve days)
• All hospital-approved costs from day 151 through 365

Plans A, B, C, D, F, and G must also cover:

• The cost of the first three pints of blood not covered by Medicare (if you need a blood transfusion)
• The 20 percent coinsurance for Part B medical charges

Plan K covers:

• 50 percent of the coinsurance for Part B medical services and 100 percent of preventative services
• 50 percent of the first three pints of blood for a transfusion
• 50 percent of hospice care cost sharing

Plan L covers:

• 75 percent of the coinsurance for Part B medical services and 100 percent of preventative services
• 75 percent of the first three pints of a blood transfusion
• 75 percent of hospice care cost sharing

On top of their basic coverages, the plans provide a combination of eight other areas of coverage. These coverage areas include the coinsurance for days 21 to 100 in a skilled nursing facility, Part A and Part B deductibles, foreign travel emergencies, and prescription drug coverage.

States may authorize the sale by insurance companies of the basic plan package and any number of the other nine approved combinations of benefits. So, there may be fewer than 10 options to choose from in your state. If you live in Massachusetts, Minnesota or Wisconsin, different types of standardized Medigap plans from the plans outlined here are sold.

Gaps in Medigap Coverage

Medigap policies do not fill all the gaps in Medicare coverage.

The biggest gap they fail to bridge is for custodial care in a nursing facility or for skilled care in a nursing home beyond the first 100 days. For coverage of these types of care, you must either purchase long-term care insurance, which will be difficult to be underwritten for depending on age or health factors, or qualify for Medicaid.

Medigap also does not cover vision care, eyeglasses, hearing aids, or dental care unless such treatment or equipment is needed as the result of an injury. In addition, Medigap plans do not cover prescription drugs.

Existing Medigap policies can still be renewed, but new plans with drug coverage cannot be purchased. You need to enroll in a separate Medicare Part D plan for prescription drug coverage.

If you keep your Medigap policy and later decide you want to enroll in Medicare’s drug program, you may have to pay a premium penalty. You won't have to pay a penalty if your Medigap plan is considered as good as the Medicare prescription drug plan. Medigap issuers should have sent notice to let you know if your Medigap plan is as good as Medicare prescription coverage.

How to Find a Medigap Plan

It pays to shop around for a Medigap policy as monthly premiums vary widely from state to state, and within states.

• The Medicare website has a page called Medigap Policy Search that helps you find and compare programs in your area.
• The Center for Medicare Advocacy also offers Medigap information.
• Read a related article with information on how to choose a plan.

For personalized advice, get in touch with a local elder law attorney.