Medicare Beneficiairies Who Switch To Plan G Could Save Hundreds Of Dollars
Denver, CO. A Colorado resident recently reported that he saved almost $200 per month in premiums when he took advantage of the special enrollment period to switch from his Medicare Supplement Plan F to a Plan G. That is a savings of $2400 per year.
The only difference between Plan F and G is that Medicare beneficiaries are responsible for paying the Medicare Part B deductible. In 2021, the Part B deductible is $203. The overall savings for this Colorado resident was approximately $2200. Medicare beneficiaries must act prior to June 30, 2021 when the special enrollment period ends.
When the federal government restricted health insurance agents and said they could no longer sell Medicare Supplement Plans C and F, the Colorado Division of Insurance created a special enrollment period for Medicare beneficiaries to enroll in a Medicare Supplement Plan D or G without any underwriting.
For Colorado Medicare beneficiaries, this means regardless of your current diagnosis, current medications, and hospitalizations, you can buy a lower cost Medicare Supplement Plan D or G, if you currently have a Plan C or F.
For years, we at The Society, as well as many other experts recommended purchasing the Plan F as it provided the most comprehensive coverage for Medicare beneficiaries who wanted insurance protection for the costs that Medicare does not cover. We are now recommending new enrollees purchase Plan D or G.
Starting January 1, 2020, the federal government prohibited health insurance agents from selling new Plan C and F policies. Although, we don’t have any way to know, our best projections are that since there will be no new enrollments in the Plans C and F, the premiums will continue to escalate causing financial hardships for many Medicare beneficiaries. We noted a significant price hike in premiums over time when Plan J was discontinued when the Medicare prescription drug program was launched in 2006.
If you are looking for ways to save money on your health insurance costs, we urge you to consider contacting your health insurance agent to review the costs of changing from a Plan C or F to a Plan D or G. You can not only change health plans, you can also change carriers. Changing carriers may also save additional dollars.
If you don’t have a health insurance agent, call the Colorado Gerontological Society and we will help you review your current plans and refer you to insurance agents with whom you can work. Call 303-333-3482, 1-855-293-6911 (toll free) or 1-855-880-4777 (Spanish) for help. Act before June 30, 2021.
Eileen Doherty
Eileen Doherty, MS is the Executive Director of the Colorado Gerontological Society. Her areas of expertise include management and administration of nonprofit organizations, education and training on issues related to older adults, advocacy and policy development on senior issues, and clinical practice in working with seniors and families to manage their lives in the later years. She has been the Director of the Society since 1982. She teaches Nonprofit Management for Fort Hays State University.
With the 2020 changes, I have recommended Plan N:
Barron’s wrote an excellent article on this October 18, 2019 “Medigap Plan F Will Soon End. Here’s How That Changes Retirees’ Costs.” Below are a few of their comments:
• “People who turn 65 after 2019 won’t be allowed to pick Medigap supplement Plan F, the most popular supplemental plan that helps retirees cover medical costs that Medicare doesn’t pay. Retirees already in Plan F by year’s end will be allowed to stay. Almost 60% of the 14 million people who have Medicare supplement insurance are in Plan F, according to CSG Actuarial research.”
• “Maura Carley, president of Healthcare Navigation, tells anyone who chooses a Medicare supplement or Medicare Advantage Plan to think about their pick from the start. Consider it a “forever choice,” she says, because people can get sick as they age and that keeps them from switching.”
• “Some insurance experts are warning people who are already in Plan F and its closest cousin, Plan G, to brace themselves for price increases.”
• “After the change, Plan G will survive as the most comprehensive plan for newcomers. It is identical to Plan F with one exception: People must pay Medicare’s deductible before insurance coverage kicks in each year. This year, the deductible is $185 (the current deductible for Part B is $203). About 27% of people in supplements are now in Plan G, according to CSG Actuarial.”
My Note: With the discontinuance of Plan F, Medicare has made Plan G Guaranteed Issue for those who lost their Medicare coverage through no fault of their own. This enables unhealthy people access to Plan G for the first time. This will adversely affect rate increases for Plan G in the future.
• “Prices aren’t expected to soar immediately. In fact, some insurance companies have been cutting premiums recently in both Plan F and Plan G to lure customers in advance of changes. But insurance experts warn retirees that as insurance companies adapt to government-imposed changes after 2020, people in both Plan F and Plan G could be shaken by rate increases.”
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Of course, Plan N has the dreaded Excess Charges Issue: Most doctors who accept Medicare patients accept the “assigned” Medicare rate for their work. A few charge a higher rate, but by law, they cannot charge more than 15 percent above the assigned rate by Medicare.
Is this a problem? In August 2016, Aetna reported that 99.34% of the claims they process have no excess charges. Of the 0.66% of claims that do have Medicare excess charges, the average amount of the charge is less than $20. You can avoid excess charges by simply asking any provider if they accept Medicare’s assigned rate. If they do not, discuss this and decide whether to choose an alternative provider.
Plan N over Plan G for the future without a doubt.