A question was asked if a Medicare supplement is a waste of money. So first we have to understand what a Medicare supplement is and what it does and a lot of people misunderstand and they think that a Medicare supplement policy or Medigap many people focus on the supplement. Does it cover my doctors in the network? And one thing we have to remember is Medicare itself is a government-sponsored insurance plan that you have paid into for your most of your working life. When you become eligible at age 65 to enroll into Medicare that will be your primary coverage. It will pay up to 80% of your claims and will be the first
Now the question, is a Medicare supplement a waste of money? The supplement is sponsored by a private insurance carrier, which we represent is responsible for paying the 20% that Medicare doesn’t pay. So if you just decided to enroll in Medicare part A and Part B part A is hospitalization and B is outpatient and doctors and you didn’t get anything else you would be responsible for costs that are above the 80 percent threshold that Medicare pays for.
What does that mean? That could be tens of thousands of dollars with no cap and no end meaning providers and hospitals and creditors will come after you to get their money because you didn’t have a Medicare supplement in place. The importance of a supplement is to pay on your behalf. The mechanics of a supplement is to pay for the 20% that Medicare doesn’t pay for and protect you from financial ruin. So Medicare policies vary in cost to below $100 to sometimes over $200, depending where you are where you live in the country.
So if you annualize that it could be anywhere from $1,200 to $2,400. And what does that protect you from? That protects you from the tens of thousands of dollars that in the event that you have to go to the hospital you would have to pay with no cap!
You have worked through your entire life to look forward to using your retirement funds for other things besides paying a hospital and doctor in retirement.
So Medicare supplement policy is an option for you to consider reach out to us if you have questions.