For many seniors, the combination of Medicare and Medigap policies means freedom from worry about medical treatment costs. A Medigap policy typically pays “first dollar,” which means that these plans cover the deductibles and coinsurance that Medicare does not. Seniors with a good Medigap policy can receive the treatment they need, both inpatient and outpatient, at no additional cost to the premium payments.
Recently, these policies have been blamed by some analysts as a cause for rising government debt, since critics feel that some policyholders may seek unnecessary treatment and their doctors may order unnecessary tests. They believe that seniors who have to pay deductibles and coinsurance will be unlikely to seek unnecessary medical attention simply because they will not be able to afford the doctor visits.
As proponents of Medigap insurance point out, these additional costs may well discourage seniors from seeking necessary medical help. Low Medigap rates allow seniors to seek care when they need it and not when they can afford it. Financial constraints can certainly cause the elderly to ignore physical symptoms that should be treated, resulting in serious illness and lengthy hospital stays.
Since states have standardized the benefits of Medigap plans, seniors face simplified choices for coverage. Many choose the most inexpensive plans simply due to family budget constraints. However, some in government have suggested these policyholders be required to partially share in the cost of their deductibles and coinsurance, but The National Association of Insurance Commissioners (NAIC) studied the proposals for cost-sharing and decided that no such plan was currently necessary.
The number of people who will need Medigap insurance may well be on the rise since many employers no longer give coverage to those on Medicare. Also, the cost of Medicare Advantage fluctuates, and seniors cannot afford uncertainty where their medical expenses are concerned. The safest route for most to take is the combination of Medicare Part A, Part B, and Medigap. Prescription coverage through Part D is also a wise choice for many.
Will Medigap Bankrupt the Healthcare System?
Medigap insurance enables those on Medicare Part A and Part B to receive the medical attention they need without worrying about the cost of deductibles and coinsurance. These plans are affordable for many and play a vital role in maintaining the health of the nation’s elderly. While some abuse of the system may occur due to this “first dollar” coverage, the benefits of these plans currently outweigh the negative consequences of this system.