How do you know if Medigap Plan F vs Plan G is better?
The first thing you need to do is understand that the difference between these two plans is minimal. A Medigap Plan is Medicare Supplement Insurance. This insurance type fills the gaps of Original Medicare. It doesn't replace how you use your Medicare benefit. There are no networks when you use Original Medicare and a Medigap Plan. There are many types of Medigap plans. Medicare does base these types on what insurance company you are using. Medigap plan benefits don't change based on what insurance company offers it.
You can tell what the benefit is, based on the plan letter.
Medicare standardized Medigap Plans. For example, a Plan F with one company will cover the same medical benefits as a Plan F with another company. The only difference, according to Medicare.gov is cost.
What is the difference between different plans? For example, Plan F vs Plan G?
There is only ONE difference between the two plans.
And that is the Part B deductible.
Other than that, the plans are exactly the same.
As a financial adviser, I used to help my clients determine if going with a Plan G was financially worth it. Let me show you how to do that yourself.
- Take the monthly premium of Plan F and subtract the monthly premium of Plan G.
- Multiply that amount by 12.
- Subtract the Part B premium from that amount.
- Decide if the difference is worth the trouble.
Here's a real life example. You are a 69-year-old female living in San Diego county. The least expensive Plan F premium as of 8/23/19 in that area was $162 per month and the least expensive Plan G premium was $141.74 per month.
- 162 – 141.75 = 20.25
- 20.25 x 12 = 243
- In 2019 the Part B deductible was $185
- 243 – 185 = 58
So the question is whether the $58 per year is worth making the change.
Is Plan F vs Plan G better? If the financial difference is small, only you can answer that.
Once the financial difference becomes large, say $150 to $200 per year, then it becomes easier to decide.
Because that is a nice dinner out.
But a difference of $58? Some people determine it's not worth their time or hassle to make the change when its that small of an amount.
Some insurance agents are using the new MACRA law to scare people who already have a Plan F. They say that Plan F is going away in 2020. That statement is only partially correct.
Starting in 2020 no NEW Medicare beneficiaries can get a Plan F. However, people are already on Medicare CAN get a Plan F. (If there isn't a Guaranteed Issue exception, they must pass the medical underwriting requirements).
And, if you already have a Plan F, nothing will change for you. You need not make a change unless the cost difference between the Plan F and Plan G is worth it to you.
You can relax! But if you want to make a change, we're here for you.