Medicare is a free U.S. federal government-provided form of health-care coverage given to individuals 65 years of age or older and those who are disabled. A Medicare supplement is a type of additional, optional coverage available for Medicare recipients.

Identification

Sometimes called Medigap, Medicare supplements are policies provided by private insurance companies to cover some of the costs of healthcare not paid for by Medicare.

Types

Federal law mandates that companies that sell Medicare supplements sell uniform plans so that consumers can easily compare the features and costs between companies. As a result, there are only 12 types of Medicare supplement plans that can be sold by insurance companies, and each plan is given a letter from A through L.

Types of Coverage

All Medicare supplement plans cover any co-payments incurred during the 61st through the 150th day of a hospital stay, hospitals costs for a full year after regular Medicare benefits expire, charges for blood transfusions and co-pays for doctor's office visits. Some plans include other features like preventative care, prescription drugs and coverage while traveling out of the country.

Requirements

In most states, Medicare supplement programs that deny coverage for pre-existing conditions must clearly state this on any policy information. Additionally, most states require Medicare supplements to offer a 30-day free look during which the insured can cancel the policy for any reason with no penalty.

Considerations

Unlike Medicare, supplemental policies require subscribers to pay monthly or annual premiums in exchange for coverage. The cost of a supplement policy varies based upon the type of policy and the age and general health of the insured.

Source:

Medicare.gov: Medigap (Supplemental Insurance)

Medicare.gov: 2009 Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare