16.3 Medicare Supplement (Medigap) Standardized Plans and Enrollment

Medicare Supplement (Medigap) Standardized Plans and Enrollment

A Medicare Supplement policy, commonly called Medigap, is private insurance that pays the deductibles, coinsurance, and copayments left over by Original Medicare. It works only with Original Medicare - never with Medicare Advantage.

Medigap plans are standardized by letter (A, B, C, D, F, G, K, L, M, N) under federal and National Association of Insurance Commissioners (NAIC) model rules. Every insurer's Plan G offers the same benefits; only the price and service differ. This standardization is a favorite exam point.

What standardization means

Exam Tip: Because benefits are identical within a letter, an agent who steers a client to a higher-priced Plan G for the same coverage is not adding value - the only legitimate differences are premium, rating method, and service.

Coverage of the gaps

Medigap fills the holes you learned in 16.1: the Part A deductible, Part A coinsurance (days 61+), the Part B 20% coinsurance, and (on richer plans) the Part B deductible and excess charges.

• Plan G - the most popular modern plan; covers everything except the Part B deductible.
• Plan F - covered the Part B deductible too, but is closed to those first eligible on or after January 1, 2020.
• Plan N - lower premium with small copays (up to $20 office, $50 ER) and no Part B excess coverage.
• Plans K and L - pay 50% and 75% of certain costs respectively until an annual out-of-pocket limit is reached, then 100%.

Worked numeric: A Plan G holder has $5,257 in approved Part B charges. They pay the $257 Part B deductible themselves; Plan G then covers the 20% ($1,000) coinsurance, so the member's total cost is just the $257 deductible.

The guaranteed-issue Open Enrollment Period

The Medigap Open Enrollment Period is a one-time 6-month window that begins the month a person is age 65 or older AND enrolled in Part B. During it the insurer must use guaranteed issue - no medical underwriting, no health-based denial, and no waiting beyond a limited pre-existing condition look-back.

Miss that window and the insurer may underwrite and decline or surcharge based on health. Guaranteed-issue rights also arise in special situations such as losing employer coverage or an MA plan leaving the area.

Key Point: A person may own only one Medigap policy at a time, and it covers one insured - never a spouse on the same policy. Selling a second duplicative Medigap is prohibited.

Scenario

A 67-year-old who just enrolled in Part B applies for Plan G. Because she is inside her 6-month Open Enrollment Period, the insurer cannot deny her or raise the rate for a prior heart condition - guaranteed issue applies.

What Medigap covers and how plans are standardized

Medicare Supplement (Medigap) policies pay the deductibles, coinsurance, and copayments that Original Medicare leaves to the beneficiary. Medigap works only with Original Medicare — never alongside Medicare Advantage.

Plans are standardized by letter (A through N) under federal law: a Plan G from one insurer carries the identical benefits as a Plan G from any other, so consumers compare on price and service, not benefit design.

Enrollment windows, the free look, and replacement rules

The Medigap Open Enrollment Period (OEP) is a one-time, 6-month window that begins when the beneficiary is age 65 or older AND enrolled in Part B. During it, coverage is guaranteed issue — the insurer cannot deny coverage or charge more for health conditions. Miss it, and the insurer may medically underwrite (outside of certain federal guaranteed-issue/trial-right situations).

Key consumer protections the exam tests:

• A person may hold only one Medigap policy covering one insured at a time; selling a duplicate is an unfair practice.
• New Medigap policies carry a 30-day free-look (right to return for a full refund).
• Plans F and C are closed to those newly eligible on or after Jan 1, 2020 because they covered the Part B deductible, which new enrollees may no longer have first-dollar coverage for.

Trap: Replacing one Medigap policy with another requires a replacement notice and a fresh evaluation of whether the consumer benefits — never replace solely to generate a commission.