16.1 Medicare Supplement Policies
Protecting our senior citizens from the high cost of health care includes providing long-term care plans and supplemental insurance plans. The NAIC provided a standardized model Medicare supplement policy, which outlines certain basic benefits, plus nine other supplement policies that provide more extensive coverage. The purpose of this law initiated by Congress in 1990 was to reduce the number of Medicare supplement policies being offered for sale and to eliminate some of the questionable marketing practices associated with these policies. The standardized forms are called "Medigap" because they are intended to fill in the gaps in Medicare coverage.
Under Florida law, Medicare supplement insurance (Medigap) applies to both the hospital and medical insurance plans administered by the federal government for the elderly and permanently disabled. Medigap insurance relieves the insured of the significant costs of deductibles and copayment provisions of services, those expenses that are not covered by Medicare. Medigap pays most, if not all, Medicare deductibles and copayments and some health care services not covered by Medicare.
When buying a Medigap insurance plan, the individual pays a premium to the carrying insurance company. Plans purchased before June of 2010 will remain in force and are renewable for life. Medicare supplement policies provide insureds with the following benefits:
- standardized coverages and benefits;
- simplified terminology;
- policy comparisons; and
- elimination of misleading or confusing policy provisions.
Medigap policies:
- supplement Medicare benefits;
- pay most, if not all, Medicare deductibles and copayments; and
- pay for some health care services not covered by Medicare.
