Medigap: What It Means, How It Works, History

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Julia Kagan
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Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia.

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Updated October 13, 2023
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Part of the Series
Guide to Medicare
Medicare Basics
  1. What Is Medicare? How It Works, Who Qualifies, and How to Enroll
  2. Do You Need All 4 Parts?
  3. Eligibility Age
  4. Part A Definition
  5. Part B Definition
  6. Latest Medicare Changes
How Medicare Works
  1. Medicare After Retirement
  2. How Medicare Works If You're Not Retired
  3. Medicare Hold Harmless Provision
  4. Medicare Star Ratings
  5. Medicare Wages
  6. When Doctors Don't Take Medicare
Medicare Part D (Prescriptions)
  1. Part D Definition
  2. Avoid the Part D Premium Penalty
  3. Creditable Coverage
  4. Best Part D Providers
Medigap Insurance
  1. Medigap Definition
    CURRENT ARTICLE
  2. Medicare Supplementary Medical Insurance
  3. Who Needs Medigap
  4. Best Medigap Providers
  5. Best Plan F Providers
  6. Best Plan G Providers
Medicare Advantage (Part C)
  1. Medicare Advantage Definition
  2. Medigap vs. Medicare Advantage
  3. Pitfalls
  4. Best Medicare Advantage Plans
Medicare vs. Medicaid
  1. Medicare vs. Medicaid: What's the Difference?
  2. How Much Medicaid and Medicare Cost

What Is Medigap Insurance?

Medigap, also called Medicare Supplement Insurance, is health insurance coverage provided by private companies to help pay costs not covered by Original Medicare. Depending on your Medigap plan, these costs might include copayments, coinsurance, deductibles, and services that Original Medicare doesn't cover, such as travel outside the U.S.

Key Takeaways

  • Around 20% of Medicare recipients use Medigap insurance from a private insurance company to pay for costs not covered by Original Medicare.
  • Standardized Medigap plans are approved by the federal government.
  • Medigap plans don't cover the costs of prescription drugs—for that, you need to get a Medicare Prescription Drug Plan (Part D).
  • You can buy Medigap during an open enrollment period after you turn 65.

How Medigap Insurance Works

Original Medicare—defined as Parts A and B—doesn't cover all expenses associated with an illness. Medigap policies are designed to help cover all or a portion of those extra charges, depending on the type of coverage.

Around 20% of Medicare beneficiaries get Medigap, according to research from the Kaiser Family Foundation (KFF).

Although private insurance companies offer Medigap coverage, the federal government requires companies to offer standardized policies. These plans are identified by letters, such as Plans A or N. 

However, plans can vary by state. For example, different standardized plans may be offered if you reside in Massachusetts, Minnesota, or Wisconsin.

You pay monthly Medigap premiums to a private insurance company licensed to sell policies in your state. You pay this premium in addition to the monthly premium for Medicare Part B. Monthly premiums can change yearly and rise with age.

Shopping for Medigap coverage is straightforward because you merely compare prices and the suitability of the insurance company.

Types of Medigap Coverage

Those eligible for Medigap in 2024 can access these choices: plans A, B, D, G, G-High Deductible, K, L, M, and N. However, not all plans are offered in every state. Even if a plan is available in your state, not all insurance companies sell policies for that plan.

But if different companies sell the same policy, price is the only difference between policies.

Here's how the 2024 Medigap plans compare.

Medigap Coverage Available in 2024
Medigap Benefit Plan A Plan B Plan D Plan G Plan K Plan L Plan M Plan N
Part A coinsurance and hospital Yes ​​Yes ​​​Yes ​​​Yes ​​​Yes ​​​Yes ​​​Yes ​​​Yes
Part A deductible No ​​​Yes ​​​Yes ​​​Yes ​​​50% 75% 50% ​​​Yes
First 3 pints of blood Yes ​​​Yes ​​​Yes ​​​Yes ​​​50% 75% Yes ​​​Yes
Part A hospice Yes ​​​Yes ​​​Yes ​​​Yes ​​​50% 75% Yes ​​​Yes
Skilled nursing facility No ​​​No ​​​Yes ​​​Yes 50% 75% Yes Yes​​​
Part B deductible No No No No No No No No
Part B coinsurance/ copay Yes Yes​​ ​​​Yes​​ ​​​Yes​​ ​​​Yes​​ 50% 75% Yes
Part B excess charge No ​​​No ​​​No ​​​Yes ​​​No ​​​No ​​​No ​​​No
Foreign Travel Emergency No No 80% 80% No No 80% 80%
Other High deductible plan in some states 2024 out-of-pocket limits: $7,060 2024 out-of-pocket limits:  $3,530

According to the Congressional Research Service, the most popular plans among those listed here are Plans G and N. The least popular is Plan M.

People eligible for Medigap before Jan. 1, 2020, who did not enroll in a Medigap plan may still be able to buy C, F, and F-High Deductible. These plans pay the Part B deductible. Those who are already enrolled in plans C, F, and F-High Deductible can keep them. However, these plans are no longer available for those eligible after January 2020.

Requirements for Medigap

You must be 65 or older to buy Medigap insurance. You must also be enrolled in Part A and Part B and not in a Medicare Advantage plan. 

Federally guaranteed issue rights don't extend to those under age 65 who qualify due to disability. However, some states extend these rights beyond 65. Companies may also choose to sell Medigap policies to Medicare recipients under age 65.

The time to buy a Medigap policy is during your 6-month Medigap Open Enrollment Period, according to Medicare. During this period, you have more choices, and private insurers can't use medical underwriting to deny you a policy or charge you more for your Medigap plan.

After this period, you may find buying a policy more expensive or impossible due to any history of health issues.

Once you have a Medigap policy, it is guaranteed renewable, even if you have health problems. In other words, the insurance company cannot cancel the policy so long as the premiums are paid.

If you drop your Medigap policy, you might not be able to get it again, or get another Medigap policy later.

Medigap History

Important years in Medigap's history include:

  • 1990: Federal standards are implemented for Medigap, including standardized plans and guaranteed plan renewal.
  • 2003: Medigap plans are barred from offering drug coverage to new beneficiaries. 
  • 2008: Required insurers to offer standardized plans, such as Plan A.
  • 2015: Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) prohibits the sale of first-dollar coverage Medigap plans to newly eligible Medicare beneficiaries, which includes plans C and F.

Is There Anything Medigap Doesn't Cover?

Medigap policies vary, but tend to lack coverage for dental, vision, hearing aids and eyeglasses, long-term care, and private-duty nursing.

Can I Have Medigap and Medicare Advantage (Part C)?

No, having both Medigap and Medicare Advantage (Part C) is not legal. If you want to switch from one plan to the other, that is possible within the first 12 months of coverage.

Who Can I Talk to About Medigap Questions?

If you have additional questions, there are a few options. You can check out this link for a live chat feature or call customer service at 1-800-MEDICARE (1-800-633-4227). 

The Bottom Line

Medigap insurance can help cover your Part A and B (Original Medicare) costs such as deductibles and coinsurance. However, you may have a limited window to sign up for a Medigap policy. Investigate options and costs available in your state in advance so you're prepared to sign up when possible.

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.

  1. Kaiser Family Foundation. "A Snapshot of Sources of Coverage Among Medicare Beneficiaries."

  2. U.S. Centers for Medicare & Medicaid Services. "How to Compare Medigap Policies."

  3. CMS.gov. "Compare Medigap Plan Benefits."

  4. CMS.gov "K & L Out-of-Pocket Limits Announcements: October 2023 Announcement."

  5. Congressional Research Service. "Medigap: Background and Statistics." Page 13.

  6. U.S. Centers for Medicare & Medicaid Services. "MACRA."

  7. U.S. Centers for Medicare & Medicaid Services. "What's Medicare Supplement Insurance (Medigap)?"

  8. Congressional Research Service. "Medigap: Background and Statistics." Pages 3-4.

  9. U.S. Centers for Medicare & Medicaid Services. "When Can I Buy Medigap?"

  10. Medigap. "Can I Switch or Drop my Medigap Policy?"

  11. Congressional Research Service. "Medigap: Background and Statistics."

  12. U.S. Centers for Medicare & Medicaid Services. "Medigap & Medicare Advantage Plans."

Part of the Series
Guide to Medicare
Medicare Basics
  1. What Is Medicare? How It Works, Who Qualifies, and How to Enroll
  2. Do You Need All 4 Parts?
  3. Eligibility Age
  4. Part A Definition
  5. Part B Definition
  6. Latest Medicare Changes
How Medicare Works
  1. Medicare After Retirement
  2. How Medicare Works If You're Not Retired
  3. Medicare Hold Harmless Provision
  4. Medicare Star Ratings
  5. Medicare Wages
  6. When Doctors Don't Take Medicare
Medicare Part D (Prescriptions)
  1. Part D Definition
  2. Avoid the Part D Premium Penalty
  3. Creditable Coverage
  4. Best Part D Providers
Medigap Insurance
  1. Medigap Definition
    CURRENT ARTICLE
  2. Medicare Supplementary Medical Insurance
  3. Who Needs Medigap
  4. Best Medigap Providers
  5. Best Plan F Providers
  6. Best Plan G Providers
Medicare Advantage (Part C)
  1. Medicare Advantage Definition
  2. Medigap vs. Medicare Advantage
  3. Pitfalls
  4. Best Medicare Advantage Plans
Medicare vs. Medicaid
  1. Medicare vs. Medicaid: What's the Difference?
  2. How Much Medicaid and Medicare Cost