Medicare Supplement Insurance (Medigap): The Complete Guide to Washington

Medicare Supplement Insurance, commonly known as Medigap, serves a single, powerful purpose: it acts as a financial shield against the unlimited out-of-pocket costs of Original Medicare. If you rely solely on Medicare Part A and Part B, you are financially responsible for significant deductibles and a flat 20 percent coinsurance on nearly all outpatient medical services. Because Original Medicare has no annual out-of-pocket maximum, a serious illness or prolonged hospital stay can easily result in tens of thousands of dollars in medical bills.

Medigap policies are sold by private insurance companies to cover those exact gaps. When you receive medical care, Original Medicare pays its approved share of the cost first. Then, your Medigap policy steps in automatically to pay the remaining balance, often leaving you with little to zero out-of-pocket medical debt.

For seniors and eligible beneficiaries in Washington state, choosing the right Medigap plan is one of the most consequential financial decisions of retirement. This guide covers the complete architecture of Medigap, how the standardized letter plans work, the critical enrollment deadlines you must not miss, and how to structure your healthcare strategy for maximum stability.

The Core Problem: Original Medicare’s Coverage Gaps

To understand why Medicare Supplement Insurance exists, you must first understand the financial risks embedded in Original Medicare. The federal Medicare program is divided into two main components: Part A (Hospital Insurance) and Part B (Medical Insurance). While the coverage is broad and highly accepted nationwide, it is not comprehensive when it comes to covering the final bill.

Medicare Part A Gaps

Medicare Part A covers inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care. However, it requires significant cost-sharing from the beneficiary:

• The Inpatient Deductible: You are required to pay a substantial deductible for each benefit period before Part A pays anything for an inpatient hospital stay. A “benefit period” is not an annual calendar year; it begins the day you are admitted and ends when you have been out of the hospital for 60 consecutive days. You could theoretically pay this deductible multiple times in a single year.
• Hospital Coinsurance: If your hospital stay lasts longer than 60 days, you must pay a daily coinsurance amount for days 61 through 90. If you are hospitalized beyond 90 days, you begin tapping into your “lifetime reserve days,” which carry an even steeper daily coinsurance. Once those are exhausted, you are responsible for 100 percent of the costs.
• Skilled Nursing Facility Coinsurance: While the first 20 days in a skilled nursing facility are covered in full, days 21 through 100 require a daily coinsurance payment.

Medicare Part B Gaps

Medicare Part B covers physician services, outpatient care, medical supplies, and preventive services. The financial exposure under Part B is arguably more dangerous than Part A because it is open-ended:

• The Part B Deductible: You must meet an annual calendar-year deductible before Original Medicare begins paying its share for outpatient services.
• The 20 Percent Coinsurance: Once the deductible is met, Medicare generally pays 80 percent of the Medicare-approved amount for services. You are responsible for the remaining 20 percent. Because there is no out-of-pocket limit, 20 percent of a $100,000 chemotherapy treatment or surgical procedure is a catastrophic expense.
• Part B Excess Charges: Under federal law, doctors who do not accept Medicare “assignment” (meaning they do not agree to accept the Medicare-approved amount as payment in full) are legally allowed to charge you up to 15 percent more than the approved amount. This difference is called an excess charge, and Original Medicare will not pay a dime toward it.

Medigap policies are explicitly designed to pay these deductibles, coinsurances, and excess charges. By paying a fixed monthly premium to a private insurance company, you transfer the risk of catastrophic medical bills away from your own savings.

How Medigap Standardization Works

To protect consumers and make comparison shopping easier, the federal government mandates that Medigap policies be strictly standardized. Across most of the United States, including Washington, Medigap policies are categorized by letters: Plan A, B, C, D, F, G, K, L, M, according to the Centers for Medicare & Medicaid Services (CMS).

Standardization means that the medical benefits of a specific letter plan are identical, regardless of which insurance carrier sells it. A Medigap Plan G purchased from UnitedHealthcare provides the exact same clinical coverage, pays the exact same gaps, and is accepted by the exact same doctors as a Medigap Plan G purchased from Regence BlueShield, Humana, or Aetna Medicare.

Because the benefits are fixed by law, carriers can only compete on three factors:

1. Monthly premium price.
2. Customer service and claims administration.
3. Pricing stability over time (how often and by how much they raise rates as you age).

The “Letter” System Explained

It is important to note that Medigap letters (Plan G, Plan N) have nothing to do with the “Parts” of Medicare (Part A, Part B, Part D). A Medigap plan is simply the private insurance wrapper that wraps around Original Medicare.

Here is a deep dive into the most relevant and heavily enrolled Medigap plans available today.

Medigap Plan G: The Comprehensive Standard

For new Medicare beneficiaries, Medigap Plan G is currently the most popular and comprehensive policy available. Plan G covers 100 percent of the gaps left by Original Medicare, with one single exception: the annual Medicare Part B deductible.

If you hold a Plan G policy, your healthcare experience looks like this: At the beginning of the year, you pay for your first few outpatient visits out of pocket until you meet the Part B deductible. Once that deductible is satisfied, your Medigap Plan G pays everything else for the remainder of the calendar year. You will face zero copays for doctor visits, zero coinsurance for surgeries, zero charges for hospital stays, and complete coverage for any Part B excess charges.

Plan G effectively transforms Original Medicare into a highly predictable, maximum-coverage health plan.

Medigap Plan N: The Budget-Friendly Alternative

Plan N was introduced as a lower-premium alternative for beneficiaries willing to take on a small amount of cost-sharing. Plan N covers the Part A hospital deductible, the hospital coinsurance, and the bulk of the Part B coinsurance, just like Plan G.

However, in exchange for a lower monthly premium, Plan N introduces three specific out-of-pocket costs:

1. The Part B Deductible: You are responsible for this annual deductible.
2. Copayments: You must pay a copayment of up to $20 for some office visits, and up to a $50 copayment for emergency room visits if you are not admitted to the hospital.
3. Excess Charges: Plan N does not cover Part B excess charges. If you see a doctor who does not accept Medicare assignment, you are responsible for paying that 15 percent surcharge out of pocket. (Note: The vast majority of physicians nationwide do accept Medicare assignment, making excess charges a relatively rare occurrence, but the risk exists).

Medigap Plan F and Plan C: The Grandfathered Policies

Historically, Plan F was the most comprehensive and popular Medigap plan on the market because it covered absolutely everything, including the Part B deductible. It provided true “first-dollar” coverage.

However, federal legislation known as MACRA (the Medicare Access and CHIP Reauthorization Act) changed the rules to discourage first-dollar coverage, theorizing that beneficiaries should have at least some financial skin in the game for outpatient services to deter overutilization.

As a result, Plan F and Plan C are no longer available for purchase by anyone who became eligible for Medicare on or after January 1, 2020. If you were eligible for Medicare before that date, you can still buy or keep a Plan F. For everyone aging into the system today, Plan G is the closest available equivalent.

High-Deductible Medigap Plans (HDG and HDF)

For beneficiaries who want catastrophic protection but are comfortable with substantial out-of-pocket costs in exchange for very low monthly premiums, high-deductible versions of Plan G and Plan F exist.

Under a High-Deductible Plan G (HDG), you must pay for all your Medicare-approved out-of-pocket costs (deductibles, coinsurances, copays) until you reach a federally set deductible threshold, which is typically in the thousands of dollars. Once that threshold is crossed, the plan functions exactly like a standard Plan G, paying 100 percent of covered services for the rest of the year.

Understanding the Medigap Open Enrollment Period

The single most critical concept in Medigap insurance is timing. While you can apply for a Medigap policy at any time, doing so outside of your federally protected enrollment window exposes you to medical underwriting.

Your Medigap Open Enrollment Period is a six-month window that begins on the first day of the month in which you are both 65 or older and enrolled in Medicare Part B.

During this exact six-month window, you possess a “Guaranteed Issue” right. This means an insurance carrier:

• Must sell you any Medigap policy they offer.
• Cannot deny you coverage due to any past or present health problems.
• Cannot charge you a higher premium because of your health status.
• Cannot impose a waiting period for coverage of pre-existing conditions.

This is a one-time opportunity. Once your six-month Medigap Open Enrollment Period expires, it is gone forever. If you apply for a Medigap policy on day one of month seven, the insurance company will put you through medical underwriting.

Medical Underwriting and Health Questions

Medical underwriting is the process by which an insurance company evaluates your health history to determine how much risk you pose. If you apply for Medigap outside of a guaranteed issue window, the carrier will require you to answer an extensive questionnaire about your medical history, current prescriptions, and past surgeries. They will also review your medical records.

If you have a serious pre-existing condition—such as a history of heart disease, cancer, diabetes with complications, or neurological disorders—the insurance company has the legal right to decline your application entirely. They can also approve you but charge you a significantly higher premium.

This is why enrolling during your six-month window is paramount. It is the only time you are completely insulated from the insurance company’s risk assessment.

Special Guaranteed Issue Rights

There are certain life events outside of your control that may trigger a special Special Enrollment Period, granting you a limited guaranteed issue right. For example:

• You are enrolled in a Medicare Advantage plan, and the plan stops serving your geographic area.
• You have retiree health coverage through a former employer, and the employer terminates the plan.
• You move out of your Medicare Advantage plan’s service area.

In these specific scenarios, federal law gives you a short window (usually 63 days) to purchase certain Medigap plans without medical underwriting. However, your choices of Medigap letters may be restricted depending on the exact nature of the life event.

Washington State Protections and Carrier Landscape

While Medigap rules are federally governed, states have the authority to implement additional consumer protections.

In the state of Washington, residents benefit from specific state regulations regarding Medigap policy switching. Washington law generally provides continuous open enrollment rights for beneficiaries who already hold a Medigap plan. Under the Washington State Medigap rule, if you currently have a standardized Medigap policy (such as Plan A, B, C, D, F, G, K, L, M, or N), you are permitted to switch to another Medigap plan of equal or lesser coverage at any time during the year, and the new carrier cannot subject you to medical underwriting.

This is a massive advantage for Washington residents. In most other states, if you buy a Plan G at age 65 and want to switch to a cheaper Plan N at age 75 because premiums have risen, you have to pass medical underwriting to make the move. In Washington, you can step down your coverage without proving your health. (Always verify the exact tiering rules with a licensed producer before attempting a switch, as the definition of “equal or lesser coverage” is strict).

The carrier landscape in Washington is highly competitive. While the state boasts 124 distinct Medicare Advantage plans, the Medigap market is driven by major national and regional carriers. Companies like Regence BlueShield, Premera Blue Cross, UnitedHealthcare (often co-branded with AARP), Humana, and Providence Medicare Advantage Plans (which also operates in the supplement space) are prominent fixtures. Because the benefits are identical by law, you should evaluate these carriers based on their monthly premiums, their history of rate increases, and whether they offer household discounts if both spouses enroll.

Medigap vs. Medicare Advantage (Part C)

When constructing your Medicare coverage in Washington, you stand at a crossroads. You must choose between two mutually exclusive paths: staying on Original Medicare and adding a Medigap policy, or leaving the federal administration of your benefits to join a private Medicare Advantage (Part C) plan.

You cannot hold a Medigap policy and a Medicare Advantage plan at the same time. Understanding the structural differences is the foundation of your decision.

The Medigap Path: Ultimate Freedom and Predictability

When you choose Original Medicare paired with a Medigap plan (like Plan G):

• No Networks: You can see any doctor, specialist, or hospital in the United States that accepts Medicare. If a world-renowned cancer center in Texas accepts Medicare, your Washington-based Medigap policy is accepted there, no questions asked.
• No Referrals: You never need a permission slip from a primary care doctor to see a specialist.
• Predictable Costs: You pay a higher upfront monthly premium for the Medigap policy, but your backend costs are nearly zero. You know exactly what your healthcare will cost you for the year, regardless of how sick you get.
• Standalone Drug Coverage Required: Medigap does not cover prescription drugs, so you must purchase a standalone Medicare Part D plan.

The Medicare Advantage Path: Lower Premiums, Network Rules

When you choose a Medicare Advantage plan, a private insurance company (such as Kaiser Permanente, Wellcare, or Devoted Health) takes over the administration of your Part A and Part B benefits.

• Network Restrictions: Most Medicare Advantage plans are HMOs or PPOs. You must use the plan’s specific local network of doctors and hospitals, or you will pay significantly more (or face zero coverage) for out-of-network care.
• Referrals and Prior Authorizations: You often need a referral to see a specialist. More importantly, the insurance company requires “prior authorization” for many surgeries, tests, and treatments—meaning the private carrier, not just your doctor, gets a say in approving your care.
• Pay-as-You-Go Costs: Medicare Advantage plans generally have very low monthly premiums (sometimes $0), but you pay copayments and coinsurance every time you use a medical service, up to a yearly out-of-pocket maximum.
• All-in-One Convenience: Most Medicare Advantage plans bundle prescription drug coverage (Part D) and offer extra perks like basic dental, vision, and gym memberships, which Medigap does not.

How Medigap Policies are Priced

While the medical benefits of a Plan G are strictly standardized, the way insurance companies calculate your monthly premium is not. Carriers use three different rating methods to price their Medigap policies. Understanding these methods is vital to forecasting what your policy will cost ten years from now.

1. Community-Rated (No-Age-Rated): The insurance company charges the exact same monthly premium to everyone who has the policy, regardless of their age. Your premium will not automatically jump just because you have a birthday, though premiums can still rise due to inflation and rising healthcare costs across the board.
2. Issue-Age-Rated: The premium is based on your age at the exact time you buy the policy. If you buy at 65, you will always pay a lower baseline premium than someone who bought the exact same policy at age 72. Premiums will increase due to inflation, but not specifically because you are getting older.
3. Attained-Age-Rated: The premium is based on your current age (the age you have “attained”). These policies often look highly attractive at age 65 because they start out very cheap. However, your premium will automatically increase every single year simply because you are one year older, in addition to inflation increases. Over a 20-year retirement, attained-age policies frequently end up being the most expensive option.

When comparing quotes from Washington carriers, always ask your licensed producer which rating method the insurance company uses.

What Medigap Does NOT Cover

Medigap is purely medical insurance designed to fill the gaps in Original Medicare. If Original Medicare does not cover a service in the first place, Medigap will not pay for it either.

Standard Medigap policies do not cover:

• Prescription Drugs: You must secure a separate Medicare Part D plan.
• Routine Dental Care: Cleanings, fillings, extractions, and dentures are not covered.
• Routine Vision Care: Eye exams for prescribing glasses or contact lenses are not covered (though medical eye issues like cataracts or glaucoma are covered by Medicare and Medigap).
• Hearing Aids: Routine hearing exams and hearing aids are entirely excluded.
• Long-Term Care: Medigap does not pay for non-skilled, custodial care, such as help with bathing and dressing, or long-term residence in an assisted living facility or nursing home.

To cover these services, beneficiaries generally purchase standalone dental and vision policies or fund them entirely out of pocket.

The Coordination of Benefits: How Claims are Paid

One of the greatest advantages of a Medigap policy is the complete lack of administrative burden on the patient. Medigap operates on a seamless, automated system called the Medicare “crossover” process.

When you go to the hospital or visit a specialist, you hand the front desk two cards: your red, white, and blue Original Medicare card, and your Medigap carrier card.

1. The provider bills Original Medicare directly.
2. Medicare processes the claim, pays its 80 percent share, and then electronically forwards the remaining 20 percent bill directly to your Medigap insurance company.
3. The Medigap company processes its portion and pays the provider directly.
4. You receive a Medicare Summary Notice (MSN) in the mail detailing what was billed, what Medicare paid, and what your Medigap policy covered.

You do not have to mail in claim forms, negotiate with billing departments, or wait for reimbursement checks. The system is designed to be entirely invisible to the patient.

The Foreign Travel Emergency Benefit

Original Medicare rarely provides coverage outside the borders of the United States. If you travel internationally, a medical emergency can be financially devastating.

Certain Medigap plans—specifically Plans C, D, F, G, M, and N—include a Foreign Travel Emergency benefit. This benefit covers 80 percent of the billed charges for certain medically necessary emergency care received outside the U.S. that begins during the first 60 days of your trip, after you meet a $250 calendar-year deductible.

The foreign travel benefit has a strict lifetime maximum limit of $50,000. If you are an avid international traveler, this built-in protection is a massive advantage over relying on Original Medicare alone, though many travelers still purchase dedicated travel insurance to cover medical evacuation.

How to Choose the Right Plan in Washington

Selecting the right Medigap plan requires mapping your personal financial tolerance against your healthcare needs. Use this decision logic to guide your process:

• If you want absolute peace of mind and no surprise bills: Medigap Plan G is the clear choice. Once your Part B deductible is met, your medical costs are effectively zero for the rest of the year. This is the closest you can get to complete medical financial immunity.
• If you want to save on premiums and don’t mind minor copays: Medigap Plan N is the logical step down. You will save money every month on your premium, but you must be comfortable paying up to $20 when you visit the doctor and absorbing the very rare risk of a Part B excess charge.
• If you travel heavily: Ensure you choose Plan G or Plan N to secure the Foreign Travel Emergency benefit. Avoid Plans A and B, which do not offer this coverage.
• If you want to keep your current doctors: Medigap (any letter) is vastly superior to Medicare Advantage. Because Medigap has no network restrictions, your relationship with your current physicians remains untouched as long as they accept Original Medicare.

Navigating the Washington Medigap market involves comparing premiums from dozens of carriers, evaluating rating methods, and ensuring you do not miss your one-time open enrollment window. Working directly with a licensed professional who understands the specific carrier pricing in Washington state will ensure you lock in the most stable, cost-effective coverage for the duration of your retirement.

Frequently Asked Questions