Medicare supplement (Medigap) insurance is private health insurance designed to supplement Medicare. It offers coverage, at varying levels, for the significant out-of-pocket costs that are not covered by Medicare, such as deductibles, coinsurance, and copayments. Medigap coverage allows seniors and younger Medicare enrollees with disabilities – many of whom are on fixed incomes – to budget for medical costs and avoid the confusion and inconvenience of handling complex medical bills. Medicare enrollees with Medicare Supplement coverage were three times less likely to have problems paying medical bills compared to enrollees without Medicare Supplement policies.
Medigap plans are used by over 14.5 million seniors and other Medicare beneficiaries, offering them a sense of security about both the predictable and unexpected costs associated with medical care. Analyses of federal data show that Medigap is a particularly important coverage option for low-income and rural seniors. Among fee-for-service (FFS) Medicare enrollees without additional insurance coverage (such as Medicaid, employer-provided insurance, etc.), 50% had Medicare Supplement coverage in 2019. Surveys consistently find that Medigap beneficiaries are highly satisfied with their Medigap coverage.