Medigap is standardized. That means that a Plan F with ABC Company is the same coverage as with XYZ. The only difference is the logo on your ID card and the premium that you are charged. In theory, although it does not always work this way, the premium is based on customer service, the size of the insurance company you have elected, and other various factors that cause one person to purchase coverage from one company while another person purchases the same coverage from a different company at a different price.
Video: Medicare Supplement plan F High Deductible Explanation
High Deductible Medicare Supplement Plan F
The Medicare supplemental insurance policy labeled high deductible Plan F is a standard plan F plan with a $2070 dollar yearly deductible and a significantly less monthly premium. When choosing a form of Medicare insurance there are two common alternatives, they are: Medicare A and B with a Medigap insurance policy or a Medicare Advantage plan. A Medigap policy is the most popular alternative of these choices. Once you have decided that a supplemental insurance policy is the best option for your health care needs the choice of which supplement policy comes next. The Medicare Supplement Plan F is the Medigap policy with the most benefits and provides the best protection from medical bills. A sometimes forgotten alternative to the plan F is the High Deductible Plan F. The high F provides the exact same benefits as a standard F plan except it has a $2076 dollar yearly deductible. The High F plan can be a less costly alternative for individuals that are in good health. The High Deductible F is an F plan with a $2070 yearly deductible. For it to make good business sense your yearly charges for the High Deductible Plan F + your percentage of Medicare covered expense must be less than the cost of a Standard Plan F. According to United American’s Company statistics a major percentage of policy holders have annual claims that are well below the deductible of $2070. The actual numbers for 2010 are: 80% of an insurance companies policyholder’s ages 65-67 had annual claims of $524.
Dave Fluker’s California Health Insurance Blog: California Medicare Supplement “Birthday Rule”
You can partially point back to AARP s original pricing over the past decade. Essentially, AARP would offer a sliding scale discount for new enrollees age 65. The first year might be 30 lower than the eventual price and this percentage would decrease over a period of time. Medicare is confusing enough to someone brand new to it so a new enrollee doesn t necessarily know how this discounted rate works. He or she just sees a rate that is 30 lower than the competitors for essentially the same level of coverage. There are two ways to look at this. One hand, you can say that AARP is providing a discount to new enrollees which they can take advantage of. Or, depending on how their rates match up with competitors 5 years years later (when the discount disappears), it smacks of a bait and switch. We re not here to cast judgement but want people who are comparing medicare supplement insurance rates to not only look at the rate now (presumably at age 65) but over the other age bands. If the rates accellerate as you get older relative to the competition, it s probably not a good deal. Keep in mind that you have a open enrollment window at age 65 (or when leaving group coverage in addition to a few others) so once you ve made a decision, it might be difficult to switch medigap plans later on if health changes. If your discounted medigap plan starts to go up at a faster clip than the other plans in later years, you may be stuck depending on your health. That s the real issue with the discounted rate. That discounted money has to come from somewhere and it s usually recouped on the back end since the underlying risk is the same. Source: theauthorplace.com
In addition to medicare what supplemental health care insurance policy is the best?
A Medicare Supplement is accepted by any doctor that accepts Medicare anywhere in the U.S. It covers everything that Medicare covers. Plan F is the most comprehensive and purchased by the most people. Plan G would be next, covering everything that Plan F covers except for the Medicare Part B deductible ($140 in 2012). Supplements do not have drug coverage; you must purchase a separate stand alone drug plan. You can be declined acceptance if you have pre-existing conditions depending on the situation.
A Quick Look Under the Hood of Medicare Supplement Plans
So what is a Medicare supplement plan? It’s a good question and if you’re turning 65 or newly introduced to Medicare from leaving a company sponsored insurance, then it’s a legitimate one. It’s important since you’re making a decision that may need to carry out for decades into the future so a good, solid understanding on what a Medicare supplement insurance plan is critical. Let’s take a look at what they are, how work, and how to choose one that’s right for you. First, obviously from the name ‘Medicare supplement plan”, you might guess that they’re intimately tied to Medicare and you would be correct. In fact, you can’t have a supplement plan unless you have both Medicare Part A AND Medicare Part B. Some people don’t realize that Part B (the physician part of Medicare to be simplistic) is required in order to even apply for a Medicare supplement plan. Part A is usually enrolled automatically or requires no payment while you must “opt in” for Part B and typically, there is a monthly premium that is paid or deducted from your Social Security check. You want to make sure to have this in place, ideally a few months prior to when you become eligible which for most people, is the 1st of the month in which they turn 65 or following coming off of group coverage. There are other triggers but these are the two main ones. So now, we know these plans require Medicare so to speak but what do they do with it? Medicare is a government sponsored health plan primarily for those over age 65 (pre-65 disabled are also eligible) and as rich as it is, there are some holes. The biggest holes are two deductibles (one for Part A hospital and one for Part B), a 20% coinsurance that you need to meet after deductibles, and outpatient medication costs. So that’s traditional Medicare. What are the Medicare supplement plans? They are insurance plans provided by private companies that fill in some or all these gaps depending on which one you select. Medicare is handled separately with the newly created Part D benefit which is also provided by private companies. Medicare supplement plans are private and many different carriers will offer them but the benefits are standardized which is really important. It makes it so much easier to choose than for the pre-65 market where there dozens of completely different plans across multiple carriers. An F Medicare supplement plan is an F plan, regardless of the carrier which brings some order to market. Knowing that, how do you go about choosing the right Medicare supplement plan for you? The standardization helps a great deal. If the benefits are the same than there are three factors in choosing a Medicare supplement plan. First, which letter plan (which determines which benefits you will have), and second, which carrier. We’ve written extensively on the first front with the winner being the F Medicare supplement plan by far. As to the second concern, it’s a question of monthly premium and carrier strength. How much does the Medicare supplement plan cost right now and how likely can the carrier keep those premiums stable going forward (relative to other carriers). This is a little trickier although most of the big carriers are typically within a few dollars of monthly premium for a given plan which makes sense. The easiest approach on this is to avoid carriers that are much higher or much lower than the average and we can help you quote multiple carriers to determine this average. If they’re much lower for a given Medicare supplement plan, you’re going to pay one way or the other since they’re all dealing with the same benefits and risk. If they’re much higher, well…that doesn’t make sense either. Hopefully, this is a good introduction to the world of Medicare supplement plans but feel free to ask us questions about your particular situation. Dennis Jarvis is a licensed insurance agent concentrating on medicare supplement insurance.