Because of changes to the laws governing the Medicare program, Plan F and Plan C will not available to new Medicare enrollees any longer. For a detailed explanation of those changes, see our page about the MACRA law. To sum it up as briefly as possible, the law was changed to discontinue plans that pay for the Medicare Part B annual deductible. In 2020, the Part B deductible is $198.
People who have Plan F or Plan C after January 1, 2020, can keep their current plan. They can even switch to a different company offering the same plan. But for new Medicare enrollees, Plan F and Plan C is no longer an option. Plan G will likely replace Plan F as the most popular plan in the next few years. Plan F had a high deductible option until the law changed. Now the High Deductible Plan G will be replacing it as the high deductible option going forward.
How Does High Deductible Plan G work?
- There is an annual deductible that must be paid before the plan pays anything towards your medical care. In 2020, that deductible is $2,340.
- Medicare Part B has a separate deductible of $198 in 2020.
- Payment for Part A services (hospital and in-patient, mostly) is applied to the $2,340 annual deductible but is not applied to the Part B deductible ($198 in 2020). Please note that you will likely have doctor services while in a hospital and those are generally covered under Part B.
- Payment for Part B services (doctor and outpatient services) is subject to the annual deductible of $198 before Medicare starts paying its 80% share of Medicare benefits. Payment of the Part B deductible IS applied to the overall plan deductible of $2,340 annually.
- After your annual deductibles are met, High Deductible Plan G will cover all remaining deductibles and co-payments for Medicare-approved care.
Is It the Right Plan For Me?
There is no rock-solid yes or no answer to this. The $2,340 deductible is a big financial commitment if you end up having to pay it. However, in the meantime, you can save a tremendous amount on premiums by going with High Deductible Plan G. It is certainly better than going with Original Medicare with no other coverage.
High Deductible Plan G is also a better alternative to Medicare Advantage plans. On Medicare Advantage, you could end up paying a $6,700 maximum out of pocket if your health takes a turn for the worse. Under High Deductible Plan G, that is limited to $2,340, plus possibly having to pay the Part B deductible in addition. As I mentioned in our popular article and video comparing Medicare supplement vs Medicare Advantage, there are many more benefits to choosing Medigap. The biggest one is being able to go to any doctor, specialist, or hospital in the country that accepts Medicare. Over 96% of doctors do.
Just as with other forms of insurance like auto and home coverage, the higher the deductible, the lower the premium. High Deductible Plan G premiums are significantly lower than other plans. The exchange is that you have that high deductible to carry some of the risk yourself.
We have offered the High Deductible Plan F for a number of years. I can tell you that the feedback that we get from those who have chosen to go that route is that they mostly didn’t think it was worth the hassle. My job is to inform you of the options that are available and educate you on how it all works. Your job is to decide what works best for your situation. Together we can come up with a plan that fits your budget and your needs.
How Do I Find a High Deductible Plan G?
Companies are not required to offer High Deductible Plan G, and only a handful of companies do offer it. Mutual of Omaha and Aetna are two of the popular companies offering it. We can help you shop all of the available companies and plans in your area to see what might be the best fit for you. Call us at 1-888-228-6119 or use the form to the right to send a question and let us know how we can best serve you.