Tips to minimize your Medicare supplemental insurance costs

by the Editor, SeniorInsider | Jun 02, 2011

Most people are looking for ways to decrease their costs without negatively impacting the level of healthcare that they receive and, and as result, options like Medicare supplemental insurance are growing in popularity. Medical insurance is expensive, and there is no doubt that insurance premiums and healthcare costs are rising every year. This can be particularly challenging for a senior citizen living on a fixed income. If you are looking for ways to save money on healthcare and your Medicare supplemental insurance, join the crowd and try some of these tips.

Selecting Medicare Supplemental Insurance

While it might seem less than intuitive to pay an extra insurance premium by electing to have a Medicare supplemental insurance policy, this is one easy way to save money and get better healthcare coverage at the same time.

If you have your primary medical coverage through Medicare Parts A and B, you will find that there are gaps in the levels of coverage for some aspects of your healthcare. Hence, Medicare supplemental insurance, or Medigap, was born. While these plans are designed and controlled by the government, private insurance companies provide them. Medicare supplemental insurance policies offer a way to get more of your healthcare costs covered by insurance.

An Example of How Medicare Supplemental Insurance Works

As an example, Medicare Part B has an annual deductible that you must pay out of pocket before Medicare starts paying their portion for visits to doctors, laboratory tests and other Part B covered medical expenses. This deductible increases each year and is currently more than $160. If you elect for a Medigap plan that pays this deductible in addition to the added levels of other coverage you get with the policy, you can use that $160 towards the Medicare supplemental insurance premiums.

Getting Enhanced Coverage With Medicare Supplemental Insurance

In addition to helping pay for expenses that would normally be out of pocket with Medicare Part A and B, a Medigap policy can also provide you an enhanced level of medical coverage. Some plans cover more medical services than traditional coverage for Medicare would. Other plans offer insurance for areas not covered by Part A and B.

For example, you have the option to select a Medicare supplemental insurance plan that includes dental and vision coverage in addition to the extra levels of medical care. This Medigap policy pays at least a portion of the costs for services that would normally be paid entirely by you. The cost savings could be enough to offset what you pay in premiums for the supplemental insurance.

Of course, this example only saves you money if you normally have dental and vision expenses and you have no other insurance coverage for those services.

Finding Cheap Medicare Supplement Insurance

Because of the way that the government works with the private insurance companies that provide the Medigap policies, it is possible to find cheap Medicare supplement coverage. When you select a Medigap policy from a private company, that insurance company becomes the provider of your medical insurance.

In this situation, the government passes on at least a portion of your monthly Medicare Part B premium to the company you have selected to be your medical insurance provider. This allows the private insurance companies to keep their monthly premiums competitive by offering cheap Medicare supplement insurance. In fact, there are some insurance providers in parts of the country who offer simple Medigap policies with zero monthly premium cost.

Is Cheap Medicare Supplement Insurance Right for You?

Just because it is cheap Medicare supplement insurance, do not assume that it is bad coverage. But also be careful not to assume that it is great coverage either. You need to make sure that you understand what you are getting with each option. It might be that the cheap Medicare supplement insurance is not as useful or valuable for your needs as a plan that costs a few dollars each month. You need to evaluate the total health coverage picture and not just focus on the monthly premium cost. Sometimes cheap insurance for seniors is just cheap and not effective.



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