What is Medicare Supplement Insurance (MedSupp)?

It is not news that Medicare provides health insurance coverages to a large portion of the population, many of them seniors. To be more precise, Medicare...

• Part A (coverage for inpatient hospital care, hospice, and home health) covers 60.9 million individuals;
• Part B (coverage for doctors, outpatient, medical equipment and home health) covers 56.1 million individuals;
• Part C (Medicare Advantage) covers 24.1 million; and
• Part D (prescription drug coverage) covers 46 million.

Stated differently, Medicare covers about 18% of the U.S. population and Medicare expenditures represent about 21% of the total cost of healthcare expenses in the U.S.

However, with deductibles and coinsurance, Medicare pays about 20% of the cost of an individual’s cost of healthcare. Maybe that is why only one person in 10 relies on Medicare alone for health coverage. The rest have some form of secondary coverage and for many that secondary coverage is a Medicare Supplement, often referred to as a Medigap policy.

The terms and conditions of Medicare and Medicare eligibility for any individual are best directed to Medicare. However, the opportunity to provide a Medicare Supplement insurance policy to address health expenses that are not covered by Medicare is enormous, since approximately 10,000 people a day turn age 65 and 90% of them have or are looking for additional health coverage.

Facts/Trends About Medicare Supplements

• The Medicare Advantage (MA) has grown from about 12 million enrollees in 2011 to more than 26 million in 2021. (AHIP, Correcting the Record: Medicare Advantage Costs Far Less than Fee-for-Service Medicare)
• Between December 2018 and December 2019, the national Medicare Supplement enrollment increased from 14 million to 14.5 million enrollees. (AHIP, The State of Medicare Supplement Coverage: Trends in Enrollment and Demographics)
• Only 4% of enrollees with Medicare Supplement coverage reported having difficulty paying medical bills in the last 12 months, compared to 12% of fee-for-service (FFS) Medicare enrollees without Medicare Supplement coverage. (AHIP, The State of Medicare Supplement Coverage: Trends in Enrollment and Demographics)
• Medicare Supplement insurance is one of the many innovative ways health insurance providers are helping protect people from high out-of-pocket costs not covered by traditional Medicare and budget for medical expenses. (AHIP, New Report People with Medicare Supplement Coverage Three Times Less Likely to Struggle with Medical Bills)

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