Let’s be honest, the different Medicare Supplement plans can make a person go crazy just looking at them. There is only one difference from a Plan F to a Plan G and it can mean savings.
Within Medicare there is a once yearly deductible, which in the year 2017 is $183.00. This is the called the Medicare Part B deductible. This deductible won’t be met if you were to go to the doctor only for preventative care.
A Medicare Supplement Plan F is known to be a popular plan because it covers excess charges and because it will pay this deductible for you. However the Plan F comes at an extra premium charge of anywhere between $12 – $48 monthly depending upon the area you reside in comparison to a Plan G premium.
With a Plan G the Part B deductible is all you are responsible for. Lets assume that the difference in premium from a Plan F to Plan G in your area is $30 monthly. Over a year that is $360. And over a 5 year period of time that is $1,800 more that you paid for a Plan F in comparison to a Plan G.
Looking at a Plan G and paying the Medicare Part B deductible on your own can be more cost effective and cost efficient to make for better use of your hard earned money.
Plan G has lower rate increase history compared to Plan F. The reason Plan F experiences higher rate increases is due to it being offered in Guaranteed Issue situations, which is when certain Medicare Supplement plans can be purchased with no health questions asked. Click here to see a complete list of Guaranteed Issue situations. Generally, if a person is in a Guaranteed Issue situation and has several health conditions, it may be the only option to be insured. Due to Plan F having several people insured with health conditions and having more claims, the premiums are going to increase more. Rate increases vary from company to company however typically range from 7-12%.
Plan G is presently not a Guaranteed Issue plan and therefore most people who carry it are healthier and have fewer claims. Rate increases have historically been lower with a Plan G as a result and typically average between 0-6%. In some situations there is no rate increase on the Plan G, which is the reason for the 0%.
Changes Ahead in Year 2020
Legislation passed in April 2015 states effective year 2020 “a Medicare Supplement policy that provides coverage of the Part B deductible may not be sold or issued to a newly eligible Medicare beneficiary.” So, Plans C and F will no longer be offered effective January 1, 2020 to any new Medicare beneficiaries. Anyone who currently has a Plan C or F may keep it as long as they pay the premiums. In the past, when other letter plans have been discontinued the future premium rate increases are typically higher.
As a result of this change ahead starting in 2020, this leaves Plan G being the only plan which covers excess charges. To understand what excess charges are, first know that many doctors accept what is called Medicare Assignment which is when the doctor agrees to accept the rate Medicare gives. And if they don’t accept Medicare Assignment the most the doctor can charge is no more than 15% above the Medicare rate. This additional 15% is what is called excess charges. At this time, it is estimated that over 90% of doctors do not charge this excess.
For most people, Medicare Plan F is not going to be the best option in the long term. Since all Medicare Supplement plans are standardized and are the same plan from company to company, you can compare your options. You have choices. Compare rates with an independent agent. Contact Senior Savings Services at 1-800-592-0819 or Click here to request a quote to find what is available to you.