Medicare won't cover all
of your health-care costs during retirement, so you may want to buy a
supplemental medical insurance policy known as Medigap. Offered by private
insurance companies, Medigap policies are designed to cover costs not paid by
Original Medicare, helping you fill the gaps in your Medicare coverage.

When's the best time to buy a Medigap policy?

The best time to buy a Medigap policy
is during open enrollment, when you can't be turned down or charged more
because you are in poor health. If you are age 65 or older, your open
enrollment period starts on the first day of the month in which you're both 65
or older and enrolled in Medicare Part B. A few states also require that a
limited open enrollment period be offered to Medicare beneficiaries under age

If you don't buy a Medigap policy
during open enrollment, you may not be able to buy the policy that you want
later. You may find yourself having to settle for whatever type of policy an
insurance company is willing to sell you. That is because insurers have greater
freedom to deny applications or charge higher premiums for health reasons once
open enrollment closes.


What's covered in a Medigap policy?

Under federal law, only 10 standardized
plans can be offered as Medigap plans (except in Massachusetts, Minnesota, and
Wisconsin, which have their own standardized plans). The plans currently sold
are Plans A-D, Plans F and G, and Plans K-N. Each Medigap plan offers a
different set of benefits. All cover certain out-of-pocket costs, including
Medicare coinsurance amounts. Some plans also cover other costs, such as all or
part of Medicare Part A and Part B deductibles, foreign travel emergency costs,
and Medicare Part B excess charges.

Medigap policies do not cover certain
health-care expenses, including long-term care, vision care, dental care, or
prescription drugs (to obtain prescription drug coverage you can purchase a
Medicare Part D Prescription Drug Plan).

You can buy the Medigap plan that best
suits your needs. But it's important to note that not all Medigap plans are
available in every state.


Are all Medigap policies created equal?

Generally, yes. Although Medigap
policies are sold through private insurance companies, they're standardized and
regulated by state and federal law. A Plan B purchased through an insurance
company in New York will offer the same coverage as a Plan B purchased through
an insurance company in Texas. All you have to do is decide which plan that you
want to buy.

However, even though the plans that
insurance companies offer are identical, the quality of the companies that
offer the plans may be different. Look closely at each company's reputation,
financial strength, and customer service standards. And check out what you'll
pay for Medigap coverage. Medigap premiums vary widely, both from company to
company and from state to state. You can find a tool on the Medicare
website,, that
will help you compare Medigap policies offered in your area. You can also visit
this website to find other important information on how Medigap policies work
with Medicare.


Does everyone need Medigap?

No. In fact, it's illegal for an
insurance company to sell you a Medigap policy that substantially duplicates
any existing coverage you have, including Medicare coverage. You don't need a
Medigap policy if you join a Medicare Advantage plan or a private
fee-for-service plan, or if you qualify for Medicaid or have group coverage
through your spouse.

You may also not need to buy a Medigap
policy if you work past age 65 and have employer-sponsored health insurance. If
you find yourself in this situation, you may want to enroll in Medicare Part A,
since it's free. Remember that if you enroll in Medicare Part B, your open
enrollment period for Medigap starts. If you don't buy a Medigap policy within
six months, you may be denied coverage later or charged a higher premium, so
you may want to wait to enroll in Medicare Part B until your employer coverage

In addition, you may not need to buy a
Medigap policy if you are covered by an employer-sponsored health plan after
you retire (e.g., as part of a retirement severance package). In this case,
your employer's plan may cover costs that Medicare doesn't. If you have any
questions about your coverage, talk to your employer's benefits coordinator.