AARP is a nonprofit, membership organization. It offers medical supplement insurance plans through the United Healthcare insurance company.
The plans, also known as Medigap, help people pay for out-of-pocket medical expenses that original Medicare does not cover.
This article looks at the various AARP medical supplement insurance plans. It also discusses enrollment options, coverage, and costs.
We may use a few terms in this piece that can be helpful to understand when selecting the best insurance plan:
- Deductible: This is an annual amount that a person must spend out of pocket within a certain time period before an insurer starts to fund their treatments.
- Coinsurance: This is a percentage of a treatment cost that a person will need to self-fund. For Medicare Part B, this comes to 20%.
- Copayment: This is a fixed dollar amount that an insured person pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
AARP, formerly called the American Association of Retired Persons, was founded by San Francisco-born Ethel Percy Andrus in 1958. It offers programs aimed to help people aged 50 years old, or older, be informed and independent.
Although AARP is not an insurance company, it offers healthcare insurance plans through United Healthcare. The plans include Medicare Part D prescription drug coverage and Medigap.
United Healthcare is a nationwide health insurance company, with reported 2019 revenue of $242.2 billion.
Original Medicare pays a proportion of covered healthcare costs. However, Medicare beneficiaries must also pay copays, coinsurance, and an annual deductible. Private insurance companies sell supplement insurance plans, known as Medigap, to fill these payment gaps.
However, Medigap policies do not cover all healthcare costs. Typically, they do not include services such as long-term care, vision or dental care, or private-duty nursing. They also may not cover hearing aids or eyeglasses.
Depending on where a person lives and when they became eligible for Medicare, they can choose from up to 10 different Medigap policies.
What are the ten plans?
Medigap plans are each given an identifying letter: A, B, C, D, F, G, K, L, M, and N. Each plan of the same letter must offer the same benefits across all the states, with the exception of Massachusetts, Minnesota, and Wisconsin.
However, costs can vary from state to state, and between the different insurance companies.
Medigap plans are guaranteed renewable, which means that if someone pays their monthly premium, the insurer cannot stop their plan. This applies even if someone becomes ill after purchasing a plan.
Not all plans are available in all states.
Some Medigap policies provide additional benefits, such as healthcare when traveling outside the United States.
AARP members can choose from 8 standardized Medigap plans offered through United Healthcare. These plans are A, B, C, F, G, K, L, and N.
Although all 50 states have at least one of these plans, people may not find all 8 plans offered in their state. A person can use this online tool to find a plan in their state.
In addition, if a person became eligible for Medicare on or after January 1, 2020, they cannot purchase Medigap plans C and F that pay for the Part B deductible.
For an individual to qualify for a Medigap plan with the AARP, they must become a member. AARP membership $12 the first year, and then $16 annually.
When someone has an AARP Medigap plan, they can use any Medicare-approved doctor or healthcare provider across the U.S.
Medicare standardizes the coverage for each Medigap plan. The table below shows some of the benefits covered through the AARP Medigap plans. A person can check the complete coverage details for all AARP plans online.
| Benefit | Coverage 100% | Coverage 50% | Coverage 75% |
|---|---|---|---|
| Part A coinsurance and additional 365 days of hospital costs | 100% All plans | – | – |
| Part A deductible | 100% B, G, N, C, and F | 75% Plan L | 50% Plan K |
| Part B coinsurance or copay | A, B, G, C, and F Plan N also 100%, although copays up to $50 may apply | – | – |
| First 3 pints of blood | 100% B, G, N, C, and F | 75% Plan L | 50% Plan K |
| Part A hospice care coinsurance or copay | A, B, G, N, C, and F | 75% Plan L | 50% Plan K |
Plans K and L have annual limits that a person must reach before the insurer begins to pay. In 2021, Plan K’s out-of-pocket limit is $6,220, and the out-of-pocket limit for Plan L is $3,110.
A person can enroll in an AARP Medigap plan during their initial Medigap open enrollment period. It starts the month a person turns 65 and is enrolled in Medicare Part B.
Insurance companies use a process called medical underwriting to decide if they will accept an application for Medigap and to determine the cost. During open enrollment, a person with health issues can enroll in any Medigap policy in their state for the same price as someone in good health.
After the open enrollment period, an individual may not be able to join a Medigap plan, or it may cost more. In addition, a person with a Medicare Advantage plan cannot also have a Medigap plan.
The premiums for AARP Medigap plans vary depending on a person’s location, and on the method a company uses to set prices. The three systems include:
- community rated, where everyone who has the policy pays the same premium, regardless of their age
- issue-age rated, where the premium is based on a person’s age when they first get a policy, but does not increase because of age
- attained-age rated, where the premium is age-related and may increase as a person gets older
As an example, the chart below shows estimated prices for a 65-year-old female, non-smoker, in Pensacola, Florida.
| Plan | Cost |
|---|---|
| Medigap Plan A | $141.93 |
| Medigap Plan B | $171.92 |
| Medigap Plan C | $205.93 |
| Medigap Plan F | $207.16 |
| Medigap Plan G | $171.23 |
| Medigap Plan K | $62.65 |
| Medigap Plan L | $119.60 |
| Medigap Plan N | $140.57 |
AARP is a nonprofit organization. One of its membership benefits includes discounts on Medigap plans through United Healthcare.
The eight AARP Medigap plans offered by AARP cover some of the gaps left in original Medicare coverage, including out-of-pocket costs such as copays, coinsurance, and deductibles. The plans vary in coverage and cost.
Each state has at least one AARP Medigap plan available, although people may not find all eight plans in their location.
We will update the 2021 costs as soon as possible after the Centers for Medicare and Medicaid Services (CMS) have released them.
We last updated the costs on this page on October 8, 2020.