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🏥 '''Medicare Supplement insurance (Medigap)''' is a category of private [[Definition:Health insurance | health insurance]] sold in the United States that covers out-of-pocket costs left by Original [[Definition:Medicare | Medicare]] (Parts A and B), such as [[Definition:Copayment | copayments]], [[Definition:Coinsurance | coinsurance]], and [[Definition:Deductible | deductibles]]. Standardized by federal regulation, Medigap policies are labeled with letters (Plan A through Plan N), each offering a defined set of benefits that remain uniform regardless of which [[Definition:Insurance carrier | carrier]] issues the policy. Because the covered benefits within a given plan letter are identical across insurers, competition among carriers centers almost entirely on [[Definition:Premium | premium]] pricing, brand reputation, and customer service rather than on benefit design.

⚙️ When a beneficiary enrolled in Original Medicare incurs a covered medical expense, Medicare pays its share first, and the Medigap policy then pays some or all of the remaining balance according to the plan's standardized schedule. Insurers offering Medigap must comply with federal rules—including a six-month open enrollment period during which [[Definition:Underwriting | underwriting]] restrictions are limited—and are also subject to state-level rate regulation. States vary significantly in how they allow insurers to set and adjust premiums: some require community-rated pricing, others permit issue-age or attained-age rating, creating meaningful differences in the [[Definition:Loss ratio | loss ratio]] profiles and long-term profitability of Medigap blocks across jurisdictions.

📊 For insurers, Medigap represents a large and growing book of business tied directly to the aging U.S. population, but it also carries distinct challenges. Because policyholders tend to retain coverage for many years, carriers must manage long-duration [[Definition:Reserves | reserves]] and anticipate medical cost trends far into the future. Rate adequacy is a persistent concern: if an insurer prices too aggressively to gain market share, it may face adverse [[Definition:Loss development | loss development]] that is difficult to correct under state rate-review processes. Medigap is unique to the U.S. regulatory framework—no direct equivalent exists in other major markets—though countries with mixed public-private healthcare financing, such as Australia and France, have analogous supplemental [[Definition:Private health insurance | private health insurance]] segments that serve a comparable gap-filling role.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Medicare]]
* [[Definition:Health insurance]]
* [[Definition:Supplemental insurance]]
* [[Definition:Community rating]]
* [[Definition:Guaranteed issue]]
* [[Definition:Medicare Advantage]]
{{Div col end}}

Definition:Medicare Supplement insurance (Medigap) - Revision history

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