What and How Medicare Pays
When a Medicare beneficiary goes to the doctor’s office or hospital for treatment, the claim is first sent to Medicare. Medicare then determines which portions of the claim are Medicare-eligible and which are not.
Obviously, when Medicare disallows a claim in full, Medicare Supplement Plans typically do not pay either. One exception, however, is “Emergency Care Received Outside the U.S.” While Medicare itself never pays anything for this, Medicare Supplement plans C, D, F, G, M, and Plan N can cover part of these expenses. Plans A, B, K, and L do not provide this extra-Medicare benefit.
When Medicare pays its portion of a routine expense, the claim is then sent to the secondary insurance plan, the Medigap or Medicare Supplement insurance carrier. Based on the plan you selected, the Medigap Plan will pay none, some, or all of the expense Medicare left. For example, the Medicare Part A hospital admission deductible is not covered at all by Plan A, is paid at 50% by Plans K and M, is paid at 75% by Plan L, and is paid at 100% by Plans B, C, D, F, G, and N.
If all of that weren’t confusing enough, there is also a High-deductible Plan F that doesn’t pay anything at all until you’ve paid the Medicare-covered costs up to the deductible amount ($2,000 in 2010).