Medicare Supplement (Medigap)
Definition
Private insurance covering costs not paid by Original Medicare — copayments, coinsurance, and deductibles.
Understanding Medicare Supplement Insurance
Medicare Supplement insurance, commonly called Medigap, is private insurance that covers the gaps in Original Medicare — specifically the deductibles, copayments, and coinsurance that Medicare Parts A and B do not pay. Medigap policies are standardized by the federal government into lettered plans (A, B, C, D, F, G, K, L, M, N), with each letter offering a specific set of benefits. Plan G has become the most popular since Plan F was closed to new enrollees after January 1, 2020. Unlike Medicare Advantage, Medigap does not restrict provider networks — any doctor or hospital that accepts Medicare accepts Medigap.
Medigap is sold by private insurers but regulated at both federal and state levels. During the Medigap Open Enrollment Period — the six months after a beneficiary turns 65 and enrolls in Medicare Part B — insurers must accept applicants regardless of health status. Outside that window, medical underwriting applies in most states, making it significantly harder to qualify.
How It Works in Practice
Medigap sales follow a different rhythm than Medicare Advantage. While MA sales concentrate during AEP, Medigap sales happen year-round because beneficiaries can enroll anytime (subject to underwriting outside their open enrollment window). Plan G premiums range from $100-250 per month depending on age, location, and carrier. Agent commissions typically run 20-25 percent of first-year premium — a $150 monthly premium generates $360-450 in first-year commission with 5-8 percent renewals ongoing. Top Medigap agents build substantial renewal books, generating $50,000-100,000 per year in passive renewal income after 5-7 years of production.
Why It Matters for Aged Leads
Aged Medicare Supplement leads are uniquely valuable because Medigap shopping is a deliberate, research-heavy decision. Beneficiaries compare plans, premiums, carrier ratings, and rate increase histories before buying. That research takes time — often 30-90 days from initial inquiry to purchase. This makes aged leads perfectly aligned with the Medigap buying cycle. A prospect who inquired 60 days ago is not a cold lead — they are mid-decision. They have likely been quoted by 2-3 agents, done their own research, and are close to a decision. Reaching them with a straightforward comparison and a no-pressure approach often closes the sale because you are arriving at the right moment. At $1-3 per aged Medicare lead versus $25-40 real-time, you can build a 500-lead weekly pipeline and systematically work the entire Medigap buying cycle.
Related Lead Types
Related Terms
Final Expense Insurance
A type of whole life insurance policy with a small face value ($5,000-$50,000) designed to cover funeral costs, medical bills, and other end-of-life expenses. One of the most popular verticals for aged leads.
Indexed Universal Life (IUL)
A permanent life insurance policy that builds cash value linked to a market index (like the S&P 500) with downside protection. IUL leads are high-value due to large policy sizes and commissions.
Term Life Insurance
Life insurance that provides coverage for a specific period (10, 20, or 30 years). Term policies are simpler and cheaper than permanent life insurance, making them easier to sell via aged leads.
Medicare Advantage
An alternative to Original Medicare offered by private insurers. Medicare Advantage plans bundle Parts A, B, and often D, frequently including additional benefits like dental and vision.
Annual Enrollment Period (AEP)
The yearly window (October 15 - December 7) when Medicare beneficiaries can change their Medicare Advantage or Part D plans. The highest-conversion period for aged Medicare leads.
Open Enrollment Period (OEP)
For Medicare: January 1 - March 31, when Medicare Advantage enrollees can switch plans or return to Original Medicare. For ACA health insurance: typically November 1 - January 15.
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