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If You Think Medicare Will Cover All of Your Healthcare Costs, Think Again

If Medicare costs nothing, why would you need Medicare supplemental insurance? If Medicare was free, you wouldn’t. But here is the unpleasant surprise that awaits many Americans as they turn 65: Medicare is not free.

Yes, the federal health insurance program called Medicare covers a substantial portion of the healthcare expenses you incur after enrolling, just as your current Colorado private health insurance does. But like your existing employer or group healthcare coverage, Medicare doesn’t cover all costs of care, treatments, and other services. As you do now, you will be on the hook for copayments, deductibles, coinsurance, and even premiums. And as your healthcare needs increase with age, so too does the amount of money you may need to spend on your medical expenses and overall health care.

Filling in The “Gaps”

These extra expenses are what Medicare supplemental insurance is all about. Original Medicare pays for much, but not all, of the cost for covered health care services and supplies. Medicare supplemental insurance, also called Medigap coverage, takes care of the “gaps” in Medicare, paying for care that could otherwise cost you tens or hundreds of thousands of dollars over time.

These policies, issued by private companies rather than the government, require the payment of monthly premiums that are significantly less than the expenses the policies cover. Medigap plans allow you to choose or keep your doctor, as long as the physician or clinic accepts Medicare insurance. Medigap insurance carries a wide selection of plans varying in cost, level of coverage, and area of availability. An experienced independent Colorado health insurance broker can go over all the different types of Medigap plans available to you.

If you are swimming in unlimited amounts of cash and won’t lose sleep over paying what could amount to a substantial portion of your retirement savings for your healthcare, you probably don’t need Medicare supplemental insurance. But if you’re like most of us, Medigap coverage proves one of the wisest investments you can make.

What You May Pay Without Medicare Supplemental Insurance

Calling the number of costs not covered by Medicare “gaps” dramatically understates the amount of money you may need to pay for your care. These “gaps” are more like chasms.

The chasms that exist in the Medicare gabs are substantial, and expenses can pile up quickly. A quick look at out-of-pocket costs for Medicare Parts A and B illustrates how much of a hit you could take without Medigap style health insurance coverage

Medicare Part A primarily addresses inpatient hospitalization. While Part A covers up to 60 days of hospitalization without copays or coinsurance, you’ll still need to pay a deductible of $1,484 in 2021.

After that 60th day (in a benefit period, meaning it doesn’t need to be 60 consecutive days), the out-of-pocket costs can get out of hand. It will cost you $371 in coinsurance each day for days 61-90 in a benefit period, a figure that grows to $742 each day for days 91 and beyond. If you are in the hospital for 150 days, your hospital coverage runs out altogether.

Cost-sharing under Medicare Part B proves similar. You are responsible for a Part B deductible of $203 in 2021. After that, Part B only pays 80 percent of approved services. This means you must cover 20 percent of the cost of all your doctor visits, ER trips, blood tests, X-rays, surgeries, durable medical equipment, and even astronomically expensive treatments like chemotherapy.

But that’s not the worst of it. There’s no lifetime cap on your 20 percent copays and coinsurance like you had on your private insurance plan. That obligation will continue forever. And for something like cancer, those costs can wipe out your retirement savings.

With a Medigap policy, you can protect your future and your finances from these “gaps” at rates that fit your budget. That said, Medigap policies don’t cover everything, including long-term care, vision or dental care, hearing aids, eyeglasses, or private-duty nursing.

Preferred Insurance: Your Colorado Medicare Supplemental Insurance Experts

When you weigh the costs and benefits of Medicare supplemental insurance, it quickly becomes apparent that the question isn’t whether you should get Medigap coverage, but rather which policy you should choose.

That’s where the skilled, independent Colorado Springs Medicare insurance brokers at Preferred Insurance can help. We are experts in Medicare coverage and offer a wide range of supplemental plan options to fit every budget and need. From selection to enrollment to education and more, we can provide you with the knowledge and guidance that will allow you to make informed and optimal coverage decisions.

If you are a Colorado Springs resident who is either currently enrolled in Medicare or is about to turn 65, please contact Preferred Insurance to schedule a free consultation to discuss your Medicare needs.