Medicare Supplement Plans in California
Medicare Supplement Insurance plans in California help pay for a variety of healthcare services covered by Original Medicare. Benefits vary according to the plan you choose and costs are set by the private insurance companies that provide Supplement plans.
What Is Medigap in California?
More commonly known as Medigap, Medicare Supplement Insurance helps cover your out-of-pocket costs under Original Medicare. These services include:
- Medicare Part A covers inpatient care received in a hospital or skilled nursing facility (NSF)
- Medicare Part B covers outpatient services, including doctor visits, lab work, durable medical equipment (DME), and outpatient procedures performed in a hospital setting
Unlike Medicare Advantage, there is no annual out-of-pocket limit with Original Medicare. This can leave beneficiaries owing substantial medical bills, particularly if they have any chronic health conditions or require multiple and/or lengthy hospital stays. California Medigap plans help pay many of these costs. How many depends on which plan you choose.
Medicare Supplement plans are standardized, which means that each Plan A (or B, C, etc.) offers the same benefits. Costs, however, are not standardized. The private insurance company offering the plan sets its own premiums.
Medigap plans are not standalone health insurance plans such as the HMOs and PPOs you get with Medicare Advantage. They supplement your Original Medicare coverage but do not replace it.
Who Qualifies for Medicare Supplement Insurance in California?
Californians aged 65 and older who are enrolled in Original Medicare are eligible for Medicare Supplement Insurance.
If you qualify for Medicare before turning 65 because you have a disability or amyotrophic lateral sclerosis (ALS, aka Lou Gehrig's disease), you are also eligible for Medigap coverage. However, if you qualify due to end-stage renal disease and are not yet 65, California Medigap insurers do not have to sell you a Supplement plan.
What Does Medigap Cover?
Medigap coverage varies by plan. There are 10 standard Medigap plans. You may also have access to high-deductible options (this varies according to where you live).
At a minimum, all Supplement plans cover the Medicare Part A coinsurance and provide an additional 365 lifetime reserve days for hospital care. The following table details benefits under each Medigap plan.
Please note that Medicare Supplement Insurance only pays for services provided by Original Medicare. If you want prescription drug coverage, you need to join either a standalone Medicare Part D plan or a Medicare Advantage Prescription Drug plan (MA-PD). However, if you sign up for an Advantage plan, you cannot enroll in a Medigap plan.
Medigap Plan C and Medigap Plan F in California
As of January 1, 2020, newly-eligible Medicare beneficiaries may no longer enroll in Medigap Plan C or Medigap Plan F. Both of these plans cover the Medicare Part B deductible, which federal law now forbids. If you already had Medigap Plans C or F, you may keep your coverage. You may also choose to enroll in one of these plans if you qualified for Medicare before January 1, 2020. However, we do not recommend doing so.
Historically, when a Medicare Supplement plan is discontinued, premiums start to rise. This is due to a dwindling pool of beneficiaries in that particular plan (since there can be no new enrollees). With the exception of the Part B deductible, two Medigap plan options give you the same coverage as Plans C and F: Medigap Plan D and Medigap Plan G, respectively.
When Is the Best Time to Join a Medicare Supplement Plan in California?
The best time to sign up for a Medicare Supplement plan in California is during your 6-month Medigap Open Enrollment Period (OEP). It starts the day you are both enrolled in Original Medicare and are age 65 or older.
Your Medigap OEP is one of the few times you qualify for guaranteed issue rights. Outside of your Open Enrollment Period, your Medigap application goes through a process known as medical underwriting, which determines:
- Whether the insurance company will offer you a Medigap policy
- How much your premium will be
But if you apply during your Medigap OEP, the insurance company can neither deny you coverage nor charge you more for it – even if you have preexisting medical conditions.
California Medigap enrollees can also take advantage of the "birthday rule." If you currently have a Supplement plan, the birthday rule allows you to switch to another plan that provides equal or lesser benefits – without undergoing medical underwriting. This window is open for the 30 days that follow your birthday.
How to Choose a Medigap Plan in California
Since Medigap plan benefits are standardized, your first task is determining the level of coverage you prefer. While it may be tempting to choose the cheapest option, it's important to remember that medical underwriting may make it impossible for you to enroll in a Medigap plan that provides more robust coverage after your Open Enrollment Period. And even the birthday rule only lets you change to a plan that offers equal or lesser coverage. In other words, it's always a good idea to plan for your future healthcare needs when it comes to choosing a Medicare supplement plan.
Although benefits are standardized, Medigap premiums vary according to the provider, so compare costs carefully. Pricing methods include:
- Community rated: Also known as no-age rated, these plans charge the same premium regardless of age. Over time, most experts agree that these are the cheapest Medigap plans.
- Issue-age rated: Premiums are based on your age at the time you join the plan, not your age throughout the life of the policy. They may rise over time due to inflation, though.
- Attained-age rated: Premiums start out low but rise as you age. These policies are usually the most expensive option over time.
Our Find a Plan tool makes it easy to compare Medigap plans in California. Simply enter your location information and coverage start date to review Medicare plan options in your area.