Is Medicare Plan F (Medigap Plan F) Really Going Away?
Medicare Plan F, or what people call Medicare Plan F, isn't a Medicare plan at all. In reality, it's a Medicare Supplement Insurance (Medigap) plan. It covers all the coinsurance, copays, and deductibles that would usually be your obligation after original Medicare pays its part. If you have a Plan F, you pay $0 for hospital stays, doctor visits, lab works, and many more. That is why Plan F has been America's most popular Medigap plan for decades.
However, in 2015, Congress passed the Medicare Access and CHIP Reauthorization Act (MACRA) bill. MACRA stops the sale of Medigap Plans F and C for people who joined Medicare in January 2020 or later. Medicare Plans C and F both cover Part B deductible, which is why these are being phased out. The powers that be thought, if insurance covers your Part B deductible, you'll go to the doctor more often.
But hang in there, this will not take effect yet until the 1st of January 2020. So you still have some time. And the good thing is that Medicare Part B doesn't cover the biggest health care costs under Medicare.
Why Plan F Is Being Phased Out
This is not the first the Medicare Supplement plans have changed. From 1990 (when Congress first standardized plan options) to 2010 there are other parts that have been phased out by the legislative (those are Plans E, H, I, and J).
The government stresses that if you have a plan that covers everything, you may go more often than necessary. This law also intends to pay doctors fairly so they will stay in the Medicare program and still provide care to beneficiaries. Also, they needed to cut spending so we won't overuse Medicare.
What Can Medicare Enrollees Do?
Most people who turn 65 before January 1, 2020 will still be able to purchase a Plan F after 2020, if they qualify medically. Those who will quality after that date can no longer buy the plan.
If you are already enrolled in Plan F, you need not worry about it because you're still covered by it for as long as you want. Phasing out Plan F won't change a thing on your coverage.
However, some advisers think after 2020 you might find an increase in the rates. This is because no new healthy 65-year-old will be allowed to join a Plan F.
For example, before 2010, there were Plans H, I, and J. After they pulled it out from the market, we saw some abrupt price increases on these plans.
But these plans aren't available anymore, whereas 60 million people still have Plan F. You'll still be able to change to a Plan F if you are eligible for Medicare prior to January 1, 2020. But you must qualify for it.
Meaning insurance companies can use your health information to exclude you from getting the coverage or to charge you more for it. They also can enforce a waiting period before a policy goes into effect.
In some states, once you have a Medicare Supplement Plan, you can change to a lesser or equal Medigap policy without medical underwriting. That means they can't say no due to your medical situation. Those states are California, Connecticut, Missouri, New York, and Oregon. These states have the Birthday Rule, which gives you a short annual window of 30 days after your birthday.
What Can Be an Alternative to Plan F?
For people eligible for Medicare after January 1, 2020, there are other plans available for you.
Plans D, G and High-Deductible Plan G (which is a brand new plan option) will still be available to Medicare beneficiaries after January 1, 2020. Among the three, Plan G is the most popular because it's almost a match in coverage, except for Part B Deductible.
Although you must pay the Part B deductible in a Plan G, the premiums can be notably less. After paying the Part B deductible, Plan G works the same as Plan F, making Plan G the most comprehensive plan for newly eligible Medicare beneficiaries starting on January 1, 2020.
It's believed that by phasing out first-dollar inclusion plans, we will reduce the yearly disbursement of Medicare. We've seen contentions on all sides of the range and might know the result after in the years to come.
It is very important to do your research. This change will affect many beneficiaries. And only time will tell what will happen to Plan F.
Picking a new plan is a tricky one, especially if you are not aware of the options. We can help! Our friendly, licensed insurance agents are here to help you find the plan that matches your needs. Best yet we explain the options available and everything you need to know. Help is just a phone call away. Call us today at (866) 445-6683 or drop us a message HERE, for a free consultation.