Medigap and Medicare PPO Plans

Original Medicare is the basic Medicare plan of all seniors age 65 and up. Some seniors choose to stay with Original Medicare; others choose to leave Original Medicare and get a Medicare Advantage Plan. For those who first had Original Medicare and now have now abandoned it in favor of a Medicare Advantage Plan: They need to know, "what happens to my Medigap?"

Medigap Policies and Medicare PPO Plans

A Medigap policy is a supplemental insurance policy that can be added to Original Medicare. Patients who buy an Original Medicare policy are allowed to buy a Medigap policy to cover whatever remaining expenses Original Medicare does not cover. Medigap policies (there are twelve total) only supplement Original Medicare.

Medicare Preferred Provider Option Plans (PPOs) are one form of Medicare Advantage Plans. PPOs, similar to private-fee-for-service (PFFS) plans, allot a certain amount of money to private insurance companies for the purpose of providing medical care. Medicare PPO plans come with a list of prescribed doctors and hospitals that a patient is allowed to go to. While a patient can go to a doctor or hospital that is outside of the prescribed network, to do so will necessitate a higher monthly insurance premium.

Since Medigap policies only come with Original Medicare, a person cannot use their Medigap policy with a PPO plan. PPOs, a type of Medicare Advantage Plan, are an alternative form of Medicare from Original Medicare Plans. To use a Medigap policy when one has a Medicare PPO Plan is to cross two different forms of private insurance and this is why it isn't allowed.

Keeping the Medigap Policy When Joining a Medicare PPO Plan

Can a patient keep his or her Medigap policy when joining a Medicare PPO plan? Yes. There is nothing illegal about keeping a Medigap policy. However, the Medigap policy will serve no financial purpose while the patient is under a Medicare PPO plan. Medicare PPO Plans are not supplemental insurance plans, nor do they need supplemental insurance policies to go with them. Medicare Advantage plans are set up to meet most of a patient's insurance needs. Thus, if a patient keeps his or her Medigap policy, he or she cannot use it while enrolled in a PPO plan. However, there is a positive benefit to keeping a Medigap policy: the patient can keep the plan in order to further deliberate whether or not to remain in the PPO policy or leave the Medicare PPO plans altogether and return to Original Medicare. Should the patient return to Original Medicare, having kept the Medigap policy might be one of the wisest decisions the patient ever made.

Medicare Advantage Plans, including PPOs, do not allow Medigap policies to coexist alongside of them. Despite the Medigap policy's inability to meet medical expenses while enrolled in a PPO Plan. However, if you can afford it, may come in handy later if you return to an Original Medicare policy.