Medicare Supplement Insurance Explained

Original Medicare — Part A (hospital) and Part B (medical) — covers a large share of your healthcare costs once you’re enrolled. It does not cover all of it. Deductibles, copayments, and coinsurance are still yours to pay, and for a serious hospital stay or ongoing treatment, those out-of-pocket amounts can add up to thousands of dollars in a single year with no cap.

A Medicare Supplement policy — also called Medigap — is private insurance designed to fill in exactly those gaps. It doesn’t replace Original Medicare. It works alongside it, picking up some or all of the costs Medicare leaves on your plate.

How it actually works, in practice

You see a doctor. Medicare pays its share. Your Medigap policy pays some or all of what’s left, depending on which plan you have. You’re billed only for whatever isn’t covered by either. There’s no network to navigate — if a doctor or hospital accepts Medicare, which the vast majority nationwide do, your Medigap coverage travels with you.

The ten standardized plans

Federal law standardizes Medigap policies into lettered plans — A, B, D, G, K, L, M, N, and a couple of others depending on your state. Each letter represents a fixed, defined set of benefits. A Plan G from one insurance company covers exactly the same things as a Plan G from any other company selling it. The letter tells you what’s covered. It tells you nothing about price, service quality, or which company is actually easiest to deal with when you need them — that part is on you to compare.

What Medigap doesn’t do

It doesn’t include prescription drug coverage — you’d pair it with a separate Part D plan. It doesn’t cover dental, vision, or hearing in most cases. And it’s not compatible with Medicare Advantage — you choose one path or the other, not both, though you can switch between them under certain circumstances.

Why people choose it anyway, given the higher monthly premium

Medigap premiums generally run higher per month than Medicare Advantage. What you’re buying with that premium is predictability — a known, usually low, out-of-pocket cost structure and the freedom to see any Medicare-accepting doctor in the country without referrals or network restrictions. For people who travel, split time between states, or simply want fewer surprises on a bill, that trade-off is often worth it.

This page is general educational information, not insurance advice specific to your situation. See our full disclosure.