Medicare supplement plans, commonly known as Medigap, are a type of supplemental health insurance that is designed to fill the gaps in payment left by Medicare. Medicare pays for a lot but not for all costs, and for those not paid Medigap kicks in. Medicare supplement plans are sold through private insurance companies, approved by Medicare. Plans are named alphabetically, from letters A – N, each plan giving a different range of coverage.
Some Medicare supplement policies also cover services that Original Medicare does not cover, like medical insurance when you travel outside the U.S. If you have Original Medicare and you buy a Medigap policy, coverage will work like the following: firstly, Medicare will pay its share of the Medicare-approved amount for covered health care costs, and then, your Medigap insurance company pays its share if some costs are left.
Medicare Supplement plan acceptance
Medicare supplement plans are secondary payers to Original Medicare. Since Parts A and B of Medicare do not cover 100% of medically produced expenses, Medigap helps you pay the remaining costs. As long as the provider accepts Medicare Assignment, they will also accept one of the Medicare supplement plans.
Medicare Assignment is a contract between a doctor and Medicare on a pre-determined amount. It is the only way to identify providers (physicians, doctors, or hospitals) who accept Medicare from those who do not. Medicare Assignment states that a doctor who has enrolled in it is required by law to accept a Medicare-approved amount as full payment for given care and services.
If your provider accepts Medicare Assignment, they agree to receive the pre-approved amount Medicare has outlined in their agreement for covered procedures as full payment. This reduces out-of-pocket costs and prevents the provider from charging you beyond what Medicare covers for certain services. The same rules apply for Medicare supplement plans, if doctors have Medicare Assignment they will accept Medicare, as well as Medigap.
How to know which doctors accept Medigap?
The only way to prevent surprise charges is to ask clearly your healthcare provider if they accept Medicare Assignment. But keep in mind, if you are scheduling a more extensive procedure like surgery, there is likely more than one doctor involved – like an anesthesiologist. Be sure to check if all the providers on your team accept Medicare Assignment.
A doctor who doesn’t accept Medicare Assignment can charge up to 15% above the Medicare-approved amount for a service. You are responsible for the additional charge, on top of your regular 20% share of the cost from Original Medicare. The doctor is supposed to submit your claim to Medicare, but it is possible that you will have to pay the doctor at the time of service and then claim reimbursement from Medicare retroactively.
However, the good news is that 95% of doctors across the United States accept Medicare Assignment.
Craig W. Hansen is an insurance professional and co-founder of William & Michael Advisor Group LLC and Jersey Insurance Solutions. Craig has served his clients in many facets of the insurance industry, always with the same goal: excellence in service while building solid, long-term, lasting relationships. With over a decade of experience in the insurance benefits industry, Craig’s clients know they can call on him anytime and receive platinum service with a smile.
