Alternatives to 1st Dollar Coverage Plans
We’ve lived our lives planning for our future and the future is now. Unfortunately, gone are 1stdollar coverage plans. Instead of paying a monthly premium that allowed us to close our wallet after writing that check we can expect to do a little more searching to find just the right plan. It’s back to the licensed insurance agent to review your needs and benefits against costs and risk.
If you aren’t familiar with 1stdollar coverage, we are referring to Medicare Supplement Plans F and C. Medicare Supplement Plans are sometimes referred to as Medigap Plans. Plan F covered everything not covered by Original Medicare. Plan C covered everything not covered by Original Medicare, except excess charges.
Nonetheless, there are great coverage options available to you. The most comprehensive Medigap Plans available for the 2020 year will be Plans G and N. Previously, these two plans were overlooked by many in favor of paying a higher premium and nothing more. Medicare Supplement Plans G and N will now be the sought-after coverage options.
In 2019, the Medicare Part B deductible will be $185. For beneficiaries enrolled in a Medicare Supplement Plan G, that $185 deductible will be all they pay for covered services. Between Original Medicare and Medicare Supplement Plan G, everything else is paid for you.
This plan is like Medicare Supplement Plan F in that you can minimize your out of pocket risk. But by assuming the $185 deductible, you will save much more than $185 on an annual basis. Currently, the Plan G is the most popular plan.
The reason is that in most cases a Medicare Beneficiary will save considerably more every year by paying their Medicare Part B deductible out of pocket. In many cases, a Beneficiary can save $300 or more over the cost of the year, and that is even after the deductible is met. To Savy seniors, this plan has been the choice for several years now.
Plan G does cover any excess changes that could be imposed by a hospital or physician’s office. So, you are not giving up any peace of mind to save several hundred dollars. The protection is in this plan. You can find Medicare Plan G reviews here.
Medicare Beneficiaries that want cost-effective coverage and are willing to use facilities and physicians that accepts Medicare assignment should consider Medicare Supplement Plan N. Plan N does not offer does not cover the $185 (2019) deductible or excess charges.
In addition, Plan N has small co-pays when seeing the doctor or going to the emergency room. The co-pay for a doctor visit, primary or specialist, is up to $20. The emergency room co-pay is up to $50.
The Plan N caters to seniors that do not go to the doctor often. Many times, the cost savings from the Plan N to the Plan G are significant as well. The only real gap in the Plan N is that it does not cover excess charges.
Most doctors do not charge them, but you will frequently see a cancer specialist, and specialty hospitals charging those charges. A Cancer policy can always be purchased, roughly $1 per day for about $10,000 in coverage, to help cover these charges if you were to be diagnosed with cancer. You can find Medicare Plan N reviews here.
Why the Sudden Change
The end of first dollar coverage plans has been several years in the making. Congress created the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and signed it into legislation on April 16, 2015.
There are several reasons for the birth of MACRA. People agree the single most important reason is to keep doctors on the Medicare program. Medicare Beneficiaries need a large pool of doctors from which to select the one that best fits their needs and personality.
It is important to mention that someone who is already enrolled in one of the plans being retired can keep it. It is even permitted to change to another carrier’s Plan F or C, depending on which plan they have currently. Provided they can medically qualify, up until 2020.
The last plan that was retired was the Plan J. The difference is when Plan J was retired, Medicare Beneficiaries were allowed a special enrollment period to change to the Plan F with no medical underwriting. This is not the case this time around.
If you want to know more about the elimination of Plans F or C, click here.
History has shown that members that elect to stay on retired plans will be subject to larger than usual rate increases. It may not occur right away but as people that are healthy leave those plans to more cost-effective alternatives and people that cannot medically change pass on, there are less people in the pool of that plan. In order to keep up with the increased claims of sicker people, the prices must increase more dramatically to cover the claims.
About the Author
Jagger Esch is the President & CEO of Elite Insurance Partners and MedicareFAQ, a senior healthcare learning resource center. As a young entrepreneur and seasoned insurance expert, he has a passion for helping people. Since the inception of his first company in 2012, he has been dedicated to helping those eligible for Medicare by providing them with resources to educate themselves on all their Medicare options. Jagger lives in the Florida sunshine state and loves boating with his family on the weekends.View All Articles