What About Traditional Medicare? For those folks who are still on the Original Medicare Plan that existed prior to the changes that created Parts A, B, C, and D, gap insurance needs work a bit differently. Overall, Medicare pays a share of costs and a Medigap policy tailored to the Original plan pays the remaining share. Not to be outdone by the Medicare Parts approach, gap insurance for Original Medicare Plan clients comes in ten different models of coverage. Again, these models are regulated by the federal government, so insurers cannot tweak them very much with marketing or odd details. Additionally, many of the same labeling requirements occur on Original Medicare Plan gap insurance policies as well, including the title of "Medicare Supplemental Insurance" on the top of the policy document offered. Points to Note About Gap Insurance Just because you purchase a gap insurance plan does not mean that you can use the coverage at just any medical provider. Many times, to control costs that do occur and must be covered, insurance providers will want the services and care to be provided by a predetermined network of providers. This network has already been pre-negotiated with the particular insurer on the rates that will be charged to a policy. As a result, clients very often are required to use specific hospitals, pharmacies, and pre-approved drug brands to stay "in network." Going outside of this network creates unexpected cost ranges, which defeats the whole purpose of the insurance provider setting up the network in the first place. For this reason many gap insurance plans include a penalty for not staying within the rules and terms, usually requiring the client to take on a larger out-of-pocket share of costs incurred out of network.
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