Medigap Plan F was once the most popular, most comprehensive (and often most expensive) Medigap plan available. This has recently changed as Medigap Plan G is now a better deal in almost every market. Why? Because of M.A.C.R.A. The Medicare Access and CHIP Reauthorization Act is an acronym for a new law that stated that those new to Medicare after 2020 could no longer purchase Plan F. The only seniors that should make a decision between Plan F and Plan G are the ones that turned 65 before 2020. In almost every other case, Plan G is the best choice available. Let’s focus on those people that need to decide.
Update on 2/27/2020 to reflect new information
Plan G is identical to Medigap Plan F in every way but one. Plan G has the same network of doctors and the exact same benefits at F except it doesn’t cover the part B deductible. The Part B deductible is a one-time calendar year deductible that you pay when you visit the doctor for none preventive reasons and costs $198.
How is Plan G better?
Good Question! Insurance companies are currently pricing Medigap Plan G $30 to $60 less each month than Medigap G. Most times you can save $500 or more a year in lower premiums on Plan G. Yes, you still have to pay $198 if you go to the doctor for a non preventive visit on plan G but when you save over $500 it is worth it.
Plan G will (most likely) be even cheaper than Plan F than in the future
Since those new to Medicare cannot purchase Plan F after 2020 the risk pool of Plan F members will be older than Plan G. Older members typically have more claims than younger members so there is speculation that Plan F prices will increase at a greater rate than G. Plan G, on the other hand, will still be adding new members who turn 65 after 2020 so its risk pool will be younger and most likely healthier.
- If you have a Plan F now, you should compare prices and consider switching to plan G.
- If you turned 65 after 2020 and are unable to purchase Medigap F due to the new law, just know that Plan G will always be available to you and, as we explained above, is almost always a better deal. Call us at 800-930-7956 to get prices and apply
Medicare Supplemental Plan F is expensive but if you cannot switch to G, it’s still worth it
Until recently, Plan F is the best coverage for seniors considering Medicare Supplement insurance (aka Medigap). While we know it can be expensive, no one really explains how much Plan F or Plan G could save you…until now. We have done a back of the envelope calculations on what Plan F or G could possibly save you. The results are surprising.
Potential Medigap Plan F or Plan G Savings in One Year:
Here is what Medigap Plan F or G could save you in one year if you are a senior in need of significant medical treatment. Remember Plan F and Plan G are 100% identical in every way except Plan G will not pay for the Medicare Part B deductible of $198.
• Your Medicare Part A Hospital deductible:
Medigap Plan F pays 100% of your Part A deductible. Those with just Original Medicare have to pay $1,408 for each 60 day benefit period. This means that if you enter the hospital for a second time after 60 days, you would have to pay that same $1,408 deductible again. Currently one of every five Medicare patients ends up back in the hospital shortly after being released, so this is a distinct possibility. It’s a stretch, but if you entered the hospital 5 times in one year. That’s a lot.
• Extra Hospital Stay Costs During days 61-90:
If you stay in the hospital for more than 60 days, without a Medigap plan F or G, you have to pay $352 per day in coinsurance Original Medicare fees. If you get a Medigap plan that covers this benefit, you would save 30 days x $352 per day. Wow!
• Extra Hospital Stay Costs for Over 90 days:
You have to pay $704 per day coinsurance per each “lifetime reserve day” after day 90 in the hospital with traditional medicare. You only get 60 lifetime reserve days without a Medicare Supplemental plan. Medigap Plan F and Plan G would pay the $704 per day benefit which would save you 60 days x $704 per day immediately. Also it would extend hospital coverage for an additional 365 days. The price of these additional days can vary, but could cost as much as $4,100 a day (Money Magazine). The additional hospital days beyond your Medicare lifetime reserve days could be as high as 215 remaining days x $4100 = $881,500 if you spent the rest of the year in the hospital. Crazy huh?!
• Skilled nursing cost from day 21 through 100:
You would have to pay $176 per day for days 21-100 if you didn’t purchase a Medigap plan with this benefit. This works out to 80 days X $176 that you would not have to pay with your plan F or G.
• Your Medicare Part B deductible.
This amount is only $198 but you will not have to pay it if you purchase Plan F Medigap. Here is where the two plans differ. Plan G does not cover the Part B deductible. Once again since you can save so much each month on lower monthly premiums, it is worth it to pay the $198 out of pocket.
• Doctor Fees.
Traditional Medicare expects you to pay 20% of doctor fees. This is the most difficult benefit to quantify because the cost of the doctor visit depends on the services you need. Plan F and Plan G pays that 20% for you and will pay 100% of any fees your doctor may charge beyond the Medicare reimbursement rate. This is called Part B excess fees and, without this Medigap benefit, if a doctor wanted more than the reimbursement rate you would have to pay for it out of your own pocket. Exact savings here for someone with Plan F and Plan G is unclear but could be substantial depending on your medical needs and what you doctor charges.
• Blood: (You could save $450)
Traditional Medicare does not cover the first 3 pints of blood. We are not sure exactly what this costs but a good guess would be $150 per pint. Plan G and Plan F cover this benefit so it would save you $150 x 3 = $450
• Foreign Travel: (You could save $50,000)
Traditional medicare doesn’t cover any foreign travel benefits. Plan F or Plan G would save you up to $50,000 of foreign medical expenses.
Total up all the above additional costs covered by Medigap plan F and Plan G and you have nearly 1 million dollars in cost not covered by Traditional Medicare. Now, it would be impossible to have all those expenses in one year but you can see that if you had serious health issues and didn’t have Medigap F or G, the cost would add up.
Check out our learn about Medigap Plan F alternatives here. As always, if you have any questions, please call us at the number above and we would be glad to review your options.