The number of people with Medicare supplement (Medigap) insurance increased to 13.6 million in 2017, from 13.1 million a year earlier, according to the American Association for Medicare Supplement Insurance (AAMSI).
Medigap plan use has increased 40% since 2010, according to AAMSI.
(Related: Medigap Group Finds Price Stability)
Congress designed the original Medicare Part A hospitalization program and the Medicare Part B physician and outpatient services program with many coverage restrictions and coverage holes, to hold down coverage costs and discourage unnecessary use of care.
Medicare enrollees often buy private Medigap insurance to fill in the Medicare coverage gaps.
Congress tried to help consumers shop for Medigap coverage on an apples-to-apples basis by establishing standardized “letter plan” benefits design rules on the market in 1990.
Since then, Medigap plan issuers and agents have faced many obstacles.
Some policymakers say generous Medigap plans drive up overall Medicare spending, by encouraging patients to get unnecessary care.
Insurers now offer many Medicare Advantage plans, which offer comprehensive coverage with low out-of-pocket costs.
But some consumers still prefer to combine traditional Medicare coverage with Medigap insurance, because that strategy lets them see any provider who takes Medicare, without worrying about a Medicare Advantage plan provider network.