Medigap and How We Can Help

March 12, 2021

Medigap and How We Can Help.

You may have noticed that, while original Medicare will cover some of your hospital and doctor expenses, there still are gaps that remain in your coverage.

Medical Supplement Insurance, or Medigap, helps fill some of those remaining gaps.

What is Medigap?

Medigap policies are sold by private insurers. There are a handful of Medigap plans with each having its own unique features. Most of the policies will cover your entire Part A deductible. After 2020, Medigap plans can no longer cover the Part B deductible. Medigap plans can also cover Part A and B coinsurance, copayments, and excess charges. Some Medigap plans also cover medical care outside of the United States. Each plan is different, as some cover the full amount while some provide partial or no coverage for these and other categories. For this reason, the monthly premium for each plan will vary. While each plan’s features and prices may vary, Medigap plans are standardized. This means that a Medigap policy will be the same across different insurers, although the insurer may charge different rates.

How are Medigap plans priced?

Medigap plans are priced in one of three ways; community rated, issue-age rated, or attained-age rated pricing. Community rated means that each person who buys a plan will pay the same monthly premium regardless of age. Issue-age rated plans are priced based off your age when you originally purchase the plan. Attained age rated Medigap Plans are priced based on your current age, so the premium increases as you age.

When Can I sign up for a Medigap plan?

Once you reach of the age of 65 and are enrolled in Medicare Part B, you will have a 6-month Medigap Open Enrollment Period. It is advantageous to purchase a Medigap plan during this period because insurers cannot use medical underwriting to accept or deny your application. This means that if you have health concerns, you cannot be denied from buying any of the Medigap plans that are offered in your state. If you miss this Open Enrollment Period and attempt to apply for a Medigap Policy, you are not guaranteed to receive a policy due to the fact that insurers would be able to use medical underwriting to assess your claim for a policy.

How do I determine when I should sign up for Part B?

Generally, you will want to enroll in Part B when you are first eligible to avoid the Part B additional premium penalty. This means that you may want to enroll if you are retired and turning 65 in 3 months, in the month you turn 65, or in the three months after you turned 65. This 7-month window makes up your Initial Enrollment Period. During the Initial Enrollment Period, you can sign up for Medicare without having to pay a penalty.

If you or your spouse are still working and are covered through an employer plan with 20 or less employees, you may also want to enroll during the Initial Enrollment Period. If you or your spouse are still working and are covered through an employer plan with 20 or more employees, you can delay your Part B coverage. You will not be subject to a Part B late enrollment penalty as long as you apply for Medicare in the 8-month period after the first of either your coverage ending or employment ending. If you or your spouse are still working and have a Health Savings Account, you may want to discuss your options with your employer to determine the best course of action.

How can Jones Financial Group help?

We are here to help make sure that you are in sound financial standing considering your insurance and investment needs. If you are going to be signing up for Original Medicare, we can help ensure that you are also supplied with a Medigap Plan if needed to help cover some of the gaps of Original Medicare. We can determine which private insurers offer Medigap plans that suits your personal situation. If you have any questions, concerns, or comments please feel free to reach out to us!


This is meant for educational purposes only. The information is based on data gathered from what we believe are reliable sources. Please consult with the appropriate financial professionals regarding your personal situation prior to making any financial related decisions.  (03/21)