If you're still in your early sixties, you may have only begun to think about issues like Social Security and Medicare, especially if you're still in the workforce. However, these years can pass quickly, and before you know it, you may be receiving notices in the mail to apply for Medicare and purchase any supplemental insurance policies you may need. If you haven't done some prior research, the amount of information you'll need to wade through to decide which policies (if any) you'll want to enroll in can be overwhelming. 

Read on to learn some basic information about Medigap policies and some situations in which they may come in handy to determine which (if any) you'll want to purchase. 

What do Medigap policies do?

These policies, often termed supplements, are additional insurance policies that attempt to fill in any gaps in coverage that may occur with Medicare Parts A and B. Although Parts A and B will cover most of your hospitalization and treatment fees, they don't offer coverage (or enough coverage) for a number of other medical expenses, from prescriptions to durable medical equipment to injuries or illnesses you may sustain while outside the country. 

As a result, many individuals with Medicare coverage opt to purchase one or more supplemental policies to ensure any medical catastrophes (or even just regular prescription expenses) are covered. This can help preserve your retirement funds by keeping your medical costs stable and insulating you against prescription cost increases or other expenses you may incur after age 65.

How can you decide whether you need a Medigap policy?  

Not everyone who purchases Medicare Part A and B will opt for a Medigap policy, but many do. In general, you'll want to consider a supplemental policy if: 

• You do a lot of out-of-country travel, which isn't likely to be covered by Medicare; 
• You or your spouse take a number of regular or life-sustaining prescriptions that are vulnerable to regular price increases; or
• You're planning to continue working for another few years before retirement but are purchasing Medicare Parts A and B when you turn 65 (as often, you'll be able to obtain supplemental insurance at a much lower cost if you purchase it at 65 rather than waiting until you're closer to 70). 

If you fall into any of these categories, you may want to contact a company like Senior Advisors to get pricing and coverage information on the Medigap policies available to you.