Medigap Plan F: What You Need to Know Before 2020
As you may have heard, some changes are happening to Medigap Plan F starting in January of 2020. You might be wondering if you need to do anything, especially if you currently have a Plan F!
The short answer is no: if you have a Plan F, you get to keep it! However, if you’re brand new to Medicare, you may never be able to purchase a Plan F. Let’s get into the details.
No Need to Panic!
First thing’s first, there’s no cause for concern. Yes, some changes are happening, but our agents here at Sams/Hockaday & Associates will let you know if you need to make any changes to your plan.
Depending on how long you’ve been in the Medicare system, you may already know that Medicare changes things all the time, so we’re pretty used to it!
Here are just a few examples of major changes that Medicare has made over the years:
- In 1988, Congress passed a bill that gave an actual limit to Medicare’s out-of-pocket costs – it was repealed in less than a year!
- Medicare Advantage was introduced in 2006 – a HUGE change to the Medicare landscape!
- Back in 2010, another Medigap plan called Plan J was discontinued.
So, Medicare changes are just part of having a governmental program, and we don’t want you to lose any sleep over the changes happening to Plan F.
The MACRA Bill From Congress
In 2015, Congress passed a pretty lengthy bill called the Medicare Access and CHIP Reauthorization Act of 2015 – it also goes by MACRA.
Essentially, this bill makes it illegal for Medigap policies to cover the Medicare Part B deductible to Medicare beneficiaries who are newly eligible on or after January 1, 2020.
That means that Plan F (and Plan C and High-Deductible Plan F) cannot be purchased by people who are newly eligible to Medicare starting in 2020.
Why Is Plan F Going Away?
While Plan F isn’t going away for everyone, it’s going away for people who are newly eligible for Medicare. Many are wondering… why?
This is going to get a tad bit political, but essentially many lawmakers believe that first-dollar coverage costs Medicare too much money.
The idea is that people who don’t have to pay anything at all are more likely to go to the doctor even when it’s not medically necessary. That costs Medicare money, so the goal is to get people to think twice before visiting the doctor.
Various studies have concluded that this isn’t true, because people who don’t go to the doctor as often are more likely to cost Medicare more in the long run, but in the end, the changes are still happening.
Starting in 2020, Plan F won’t be available for new 65ers.
What If I Have a Plan F Now?
We have great news – if you already have a Plan F, you can keep it!
The beauty of a Medicare Supplement is that it’s guaranteed renewable. That means you cannot be cancelled or lose your coverage as long as you pay your premiums on time. That Plan F is yours for as long as you live.
In addition, if your health allows, you always have the opportunity to shop around and see if you can save money by switching carriers – or Medigap plans.
No matter what, our agents are going to do what’s best for you, so whether it’s staying where you’re at or taking a look at what’s available, we’re going to do everything we can to make sure you’re in the best place possible. That’s a promise!
What If I’m Already on Medicare – Can I Buy a Plan F After 2020?
The short answer is yes – if you are or were eligible for Medicare Part B before January 1, 2020, you will still be able to buy a Plan F. That’s around 60 million people that can still buy a Plan F, by the way!
While the Plan F is being phased out, it’s going to take a long time before it’s truly gone. In fact, we’re guessing that Plan F rates may go down a bit since it’ll be mostly underwritten business moving forward.
That may be a bit too technical if you’re not familiar with the insurance industry, but the main idea is that the Plan F isn’t going away for everyone.
If you still want a Plan F, we can shop around and potentially get you a great buy as 2020 approaches.
What If I’m Eligible for Medicare In 2020?
If you become eligible for Medicare after January 1, 2020, you won’t be able to purchase a Plan F. However, there are still a ton of options for you!
As Plan F is phased out for new Medicare beneficiaries, Plan G will be taking its place. Plan G is identical to Plan F except it doesn’t cover the Medicare Part B deductible.
You might also consider a Medigap Plan N, which has a slightly lower premium, but comes with copays at the doctor and hospital.
In addition, you could switch gears entirely and look into Medicare Advantage plans or a Medicare Medical Savings Account (MSA).
Unlike Medigap plans, Medicare Advantage plans have constant out-of-pocket costs. We often like to explain them as “pay as you go” plans, where you pay every time you use the plan. The nice thing about these plans is they’re low premium, and they usually come with extra benefits like dental and vision, or even free gym memberships.
Additionally, there is a new product available in Illinois called a Medical Savings Account (MSA). This is a $0 premium, high-deductible health insurance plan that comes funded with an annual deposit. That’s right – free money given to you each year that you can use on qualified medical expenses.
Unlike Medicare Advantage plans, the MSA has no networks, so you can see any doctor and go to any hospital you like. In addition, the MSA has no copays.
See – lots of options! When 2020 comes around, you won’t even realize that the Plan F is no longer a choice, because there are plenty of other great health insurance options available to us.
What’s Replacing Plan F?
Currently, Plan F is one of the Guaranteed Issue plans. Guaranteed Issue is a situation where you can get certain Medigap plans without passing medical underwriting. However, that will change starting in 2020.
The following Guaranteed issue plans will be available for “newly eligible” Medicare beneficiaries: Plan G, D, and High-Deductible G (new!).
You may have heard that there’s also a plan called High-Deductible F – we’ve never sold one because it’s not a good plan – but that’ll be replaced by High-Deductible G.
High-Deductible G will be available starting January 1, 2020. Both “newly eligible” Medicare beneficiaries and current beneficiaries will be able to buy the new High-Deductible G.
Confused? We Can Help!
We understand better than anyone that all of the Medicare jargon and lingo can be confusing. That’s what we’re here for! You don’t need to know all the plans and parts and enrollment details if you don’t want to.
We’re always here to educate and arm you with as much information as you want, but know that our team will help you find the right plan no matter the situation.
If you have any questions about your current plan or about the Plan F changes in 2020, simply contact our team. We’re happy to help!
Call us at 217-423-8000!
Prefer to email? Fill out our contact form.
Prefer to schedule an appointment yourself? Visit our online scheduling system.
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