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Understanding Medicare Supplement Plan L
Medicare Supplement Insurance plans, also referred to as Medigap Plan L, can help pay for out-of-pocket costs such as deductibles and copayments that are not covered by Medicare Parts A and B (Original Medicare). There are eight standardized Medicare Supplement insurance plans available for purchase (in all states except for Massachusetts, Minnesota, and Wisconsin, as they have their own standardized Medigap plans). Medigap Plan L provides less coverage to supplement Original Medicare compared to most Medigap plans, but it does set a lower out-of-pocket cap which can be beneficial. Medigap Plan L may be a good option for individuals who are on a tighter budget.
What does Medicare Supplement Plan L cover?
Plan L covers 75% of your healthcare expenses (coinsurance and copayments), comes with a lower monthly premium, and features a helpful out-of-pocket limit on Original Medicare-covered costs, which is $3,110 in 2021.
Hospital Expenses: Pays Part A coinsurance and hospital costs, up to 365 days after Original Medicare benefits are exhausted.
Pays Part A coinsurance and hospital costs, up to 365 days after Original Medicare benefits are exhausted.
Medical Expenses: Pays 75% Part B coinsurance or copayment, except for preventive care services, which are covered 100%.
Pays 75% Part B coinsurance or copayment, except for preventive care services, which are covered 100%.
Transfusions: Pays 75% of Medicare-eligible expenses for the first three pints of blood.
Pays 75% of Medicare-eligible expenses for the first three pints of blood.
Hospice Care: Pays 75% hospice coverage for Part A coinsurance or copayment.
Pays 75% hospice coverage for Part A coinsurance or copayment.
Skilled Nursing: Pays 75% coverage for facility care coinsurance.
Pays 75% coverage for facility care coinsurance.
Additional Hospitalization Expenses: Pays 75% coverage for your Original Medicare Part A deductible.
Additional Hospitalization Expenses
Pays 75% coverage for your Original Medicare Part A deductible.
Part B Deductible: The Medicare Part B deductible for 2021 was $203. After the deductible is met, you pay 20% of the Medicare-Approved Amount (this is the amount a doctor or supplier that accepts assignment can be paid in Original Medicare) for most doctor services, outpatient therapy and durable medical equipment.1
Part B Deductible
The Medicare Part B deductible for 2021 was $203. After the deductible is met, you pay 20% of the Medicare-Approved Amount (this is the amount a doctor or supplier that accepts assignment can be paid in Original Medicare) for most doctor services, outpatient therapy and durable medical equipment.1
Part B Excess Charges: Providers who don’t accept Medicare assignment may charge up to 15 percent more than what Medicare is willing to pay, known as Part B excess charges. Medicare assignment is the Medicare approved cost for a particular medical service. Medicare assignment is accepted by Medicare-approved providers.
Part B Excess Charges
Providers who don’t accept Medicare assignment may charge up to 15 percent more than what Medicare is willing to pay, known as Part B excess charges. Medicare assignment is the Medicare approved cost for a particular medical service. Medicare assignment is accepted by Medicare-approved providers.
Foreign Travel Medical Emergencies: In most cases, Medicare won’t pay for health care or supplies you get outside of the U.S.
Foreign Travel Medical Emergencies
In most cases, Medicare won’t pay for health care or supplies you get outside of the U.S.
Prescription Drugs: Medigap Plan L does not cover prescription drugs. However, you can buy an additional Medicare Prescription Drug plan to cover prescription drug costs.
Medigap Plan L does not cover prescription drugs. However, you can buy an additional Medicare Prescription Drug plan to cover prescription drug costs.
Who can benefit from this type of supplement plan?
You may consider Plan L if you want a lower premium, as well as a lower annual out-of-pocket that you have to reach before the plan pays 100% of your hospital expenses. This can be helpful for unexpected medical emergencies or for those with chronic health conditions that require a lot of ongoing medical care.
Why Ellen Chose Medicare Supplement Plan L
Wow, a supplement plan that fills 75 percent of the Medicare gap expenses? When Ellen saw that, she said “sign me up.” Ellen is living comfortably on her social security benefits, but she’s cautious about incurring extra expenses, especially when it comes to healthcare. She’s active and healthy, but she knows surprise illnesses can happen.
When Ellen shopped for a supplement plan to help fill the gap in her Medicare coverage, she paid attention to which ones offered lower out-of-pocket caps.
In addition, she wanted to find a plan that paid higher percentages of expenses and would cover most or all of her coinsurance.
For these reasons, Ellen chose Medicare Supplement Plan L.
Advantages to Medicare Plan L
- Lower monthly premium.
- Covers 75% of your healthcare expenses.
- Out-of-pocket limit on Original Medicare-covered costs, which was $3,110 in 2021.
Drawbacks to Medicare Plan L
- Less coverage of Original Medicare costs.
How much does Medicare Supplement Plan L cost?
Monthly premiums are set by the private insurance companies who offer Medicare Supplement Insurance and are based on factors such as your age, health status, location, and gender. Since the cost of coverage can change from carrier-to-carrier, it’s often in your best interest to shop around to ensure you’re paying the lowest amount possible for your Medigap coverage. Companies may not cancel your coverage unless you don’t pay the plan premium, you weren’t truthful on the application, or the Medigap insurance company becomes bankrupt or insolvent.
How Pricing Works For This Plan
Pricing for Medicare Supplement Plan L varies by company. Medigap policies can be priced in 3 ways: community-rated, issue-age-rated, and attained-age-rated.
- Community-rated: Generally, the same monthly premium is charged to everyone who has the Medigap plan, regardless of age. Premiums may go up because of inflation and other factors, but not because of your age.
- Issue-age-rated: The premium is based on the age you were when you bought the Medigap plan. Premiums are lowered for people who buy at a younger age and won’t change when you get older. Premiums may go up because of inflation and other factors, but not because of your age.
- Attained-age-rated: The premium is based on your current age, increasing your premium as you get older. Premiums are lower when you are younger, but continually increase as you age. Premiums may also increase because of inflation or other factors.2
When to Enroll in Medicare Supplement Plans
When you’re first eligible: The best time to enroll in a Medicare Supplement plan is when you’re first eligible. You are eligible to purchase a Medicare Supplement policy (Medigap) on the first day of the month in which you turn 65. This marks the beginning of your Medigap Open Enrollment Period which lasts for six months.
You must already be enrolled in Medicare Part A and Part B. During this period, you can buy any Medigap policy sold in your state, regardless of any health problems. You will generally see better prices and more choices among Medigap policies during this period.
Outside open enrollment: While it’s often better to get coverage when you’re first eligible, you can still apply for Medigap coverage after your initial enrollment period. However, if you apply for coverage after your initial enrollment period, there’s no guarantee that an insurance company will sell you a policy if you don’t meet the medical underwriting requirements.
FAQs About Medicare Supplement Plan L
Learn more about Medicare Supplement Plan L with answers to frequently asked questions.
What is the out-of-pocket limit for Medicare Plan L?
The out-of-pocket limit on Original Medicare-covered costs for Medicare Plan L was $3,110 in 2021.
Do Medigap plans vary by state?
Do Medicare Supplement plans cover pre-existing conditions?
While insurance companies can’t make you wait for your coverage to start, they may make you wait for coverage for a pre-existing condition. Coverage for pre-existing conditions can be excluded if the condition was treated or diagnosed within 6 months before the coverage starts under the Medicare Supplement plan.
After the 6-month period, the Medicare Supplement plan will cover the condition that was excluded. However, it is possible to avoid or shorten the waiting period for a pre-existing condition if you buy a Medicare Supplement plan during your Medigap open enrollment period to replace “creditable coverage” Medigap plan.3
Compare Medicare Supplement Plans
There are a variety of Medicare Supplement plans available. Learn more about the various Medicare Supplement plan options below.
Find the Right Medicare Supplement Plan For You With SelectQuote
It can be hard to determine what available Medicare plan is best for you, your health and your budget. At SelectQuote, we’ll take the time to learn about your specific needs, then shop and compare all of the Medicare plans available to you to find you the right Medicare coverage for your situation.