Medigap Plan F and Plan C will no longer be available in January 2020. The Medicare Access and CHIP Re-authorization Act of 2016 (MACRA) will eliminate plans that cover the Part B deductible.
If you have Plan F and Plan C, don’t worry, we’ll explain later in this article what will happen to your coverage. If you don’t have Plan F or Plan C, we’ll still cover in this article what you can do before the changes in 2020.
Why is Plan F and Plan C going away?
MACRA or the Doc Fix was passed last year to ensure that doctors would adequately be paid for providing Medicare services. However, earlier laws proposed that doctor’s rates would be decreased over time. Doctors did not like this proposal and threatened to leave the Medicare program if cuts continued. The Doc Fix is estimated to be 200 billion dollars over the next 10 years. Congress needed a solution to this issue, which included reforming existing Medicare Supplement plans. Utilization studies show that people who don’t pay anything to access care are most likely to stay on top of Medical care. Therefore, Plan F and C are on the chopping board.
If I have Plan F or C what will happen?
-If you are already enrolled in Plan F or Plan C you will be grandfathered in your plan. This will give you the ability to keep your existing plan.
-If you are eligible before 2020 but have delayed signing up for Medicare, because you’re still working and have employer insurance, you can still opt for Plan F or Plan C.
What’s the difference between Plan F and Plan G?
Plan G does not pick up your annual $183 deductible.
You’d think that Plan “G’ should be $183 less than Plan “F” right? WRONG! Remember, MACRA eliminates Medicare Supplement plans without deductibles to reduce utilization. Like the government, insurance carriers look at the claims of people in each risk pool. The bottom line is, people who have Plan F go to the doctor more often than people who have Plan G. Consequently, the insurance carriers charge accordingly. For example, a 70-year-old who lives in Los Angeles County pays $231.63 per month for Plan F with a policy from Anthem Blue Cross and $175.91 for Plan F, a savings of $668.64 per year to have a deductible of $183. Worst case scenario, you’re still ahead $485.64 per year.
Can I switch to Plan G now?
If you can qualify medically, you can change anytime. However, if you cannot qualify medically, you can always change your plan under the “Birthday Rule.” Under the “Birthday Rule,” you have 30-day window beginning on your birthday which allows you change to Plan G without medical questions.
You can submit your application 90 days prior to your birthday. Depending on the insurance carrier and your specific birthdate, your new policy will either be effective on the first day of your birthday month or the month after. Call us at 1-800-356-3615 or apply for a free quote.