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Are We Losing Medicare Supplement Plan F?

By: | Tags: | Comments: 0 | March 6th, 2018

Is Medicare Supplement Plan F Leaving the Scene?

Is Medicare supplement Plan F leaving the scene? Yes, it is – No need to panic though, not quite yet.

The past few decades have seen Medigap Plan F establish itself in the market as one of the most popular Medicare supplement plans because it provides the most comprehensive coverage for individuals purchasing a Medicare supplement. In other words, it gives better coverage than any other plans you can buy.  The bad news it’s going to be eliminated and many people will feel the impact of losing plan F, the good news is we’ve been given enough time by Congressional lawmakers to get prepared. We actually have until 2020 before any changes take place.

So, why is Medicare Plan F really being discontinued, is this just another case of government bureaucracy making a bad decision? Well before you get yourself all up in a tizzy, we’ll help you understand the reasons for their decision in this post and you’ll feel a lot better about your options.  So just keep breathing and reading. If you would prefer to contact one of our Medicare coverage helplines either now or after reading this blog post you may call a licensed Medicare specialist at 866-936-3831

 

When is Plan F Actually leaving?

For some, Both Plan F and C will be leaving the medicare scene in 2020 and will no longer be an option. However, not everyone will be affected by these upcoming Medicare changes in 2020. Certain beneficiaries already on Medicare Plan F will be able to keep their plan if they want to.

We just need to look back at history to see where we are headed.  It has always been very common for Congress to decide on introducing changes to Medicare supplement plans. They first came up with standardized medicare supplement plans in 1990, before abolishing the Plans E, H, I, and J later in 2010. Now in 2020 is,  Plans C and F will be eliminated as a coverage choice for many beneficiaries.

Although this could cause you to think about buying a Plan F right away so that you may be able to  grandfather in your Plan F coverage, that may not be such a good idea. If history repeats itself, the Plan F rates may take such a steep hike in price after 2020 and beyond that it will become unattaractive for those trying to stay on the plan under a grandfather clause.  This explains the need for us to first discuss the reasons for these changes.

Why is Plan F being Eliminated?

What is actually going on with Plan F? What is the reason for the elimination of Medicare Plan F?

These Medicare supplement plan changes arrive in accordance with the 2015, MACRA (Medicare Access and CHIP Reauthorization Act). The “doc fix” law is the common appellation you may have heard.

This legislation was passed by Congress last year to make sure doctors are better paid for their Medicare services in the coming years. Our doctors getting fair payments for attending to Medicare patients is definitely something we all want. However, certain existing laws would have instead led to pay cuts for doctors in the upcoming years.

This didn’t go over too well with doctors in the medicare program as you can imagine. Many medical providers made threats to quit the Medicare program completely if they were paid any less. So has been every year like clockwork, Congress would go through a last-minute vote to hold off the cuts to the doctor’s payments, but it was really only kicking the can down the road and not actually providing a permanent solution.  That probably sounds familiar, right!

 

Why is Plan F being phased out? As you know, its always about the money somehow! New legislation enacted by Congress is looking to get doctors “fair” payment for their Medicare services while pushing you to get some skin in the game in the form paying for an annual deductible.

The Centers for Medicare & Medicaid was in such a need of a solution for a better payment arrangement to the doctors or they would have revolted againt the Medicare program like Fletcher Christian’s insurgents did against Lieutenant Bligh in Mutiny on the Bounty . The exodus of medical providers from the medicare program was projected be so devastating that it was compared to when Moses left Egypt. That may have led many like youself  to lose access to your current doctor. Thus a solution to increase payments to doctors was born out of the need to keep them engaged and happy and to remain in the Medicare program while at the same time providing medicare beneficiaries with the same providers they’re used to seeing. I don’t think I ve seen performers in Barney and Bailey with more to juggle than this.  The additional cost to the medicare program is projected to be about $200 billion over ten years, but you get to keep your doctor .

Money doesn’t grow on trees so Congress needed to squeeze out that $200 billion from somewhere. The measures they took included the reform of current Medigap policies like Plan F and others. Keep reading to find out what they decided.

 

Obligatory Subjection of All Medicare Beneficiaries to a Deductible

Both Medicare Parts A & B are currently subjected to deductibles. Deductibles refer to certain amounts of money you are required to pay from your pocket prior to the commencement of your benefits.

Medigap plans will continue covering the Hospital deductible of Part A, but will no longer offer coverage to the Part B deductible as of 2020 for new enrollees. The annual medicare part b deductible in 2018 is $183.

Right now that deductible is covered by the Plan F supplement. The elimination of Plan F also means you will have to come out of pocket to pay the medicare Part B deductible yourself. Congress employs this measure seeking to get the beneficiaries of Medicare in a sense to bring some extra “skin in the game.”

This is a significant change, for those of you that are newbies to Medicare, Plan F provides beneficiaries with “first dollar” coverage. This means that from day one, 80% of medical charges under Part B are covered by Original Medicare. Meanwhile the other 20% of medical costs  are covered by the Medigap Plan F.  I was never a math wizard in school, but I m certain that 80% + 20% = 100% coverage. In other words, current Plan F beneficiaries don’t pay any deductibles, copays or coinsurance for charges related to medicare part b. That’s why Plan F is so popular today!

The nervous nelly congressional lawmakers fear that people with a medicare supplement plan f will over utilize the system because they know there is no charge or out of pocket  cost to visit a medical provider so they can see them for every simple ache or pain . They fear it will drive up the overall cost of the medicare program and then be forced to make unwanted cuts to payments to doctors as we discussed earlier.

Thus the government lawmakers made changes to address the concerns they have by subjecting medicare beneficiaries to deductibles where they had none before. The Centers for Medicare and Medicaid (CMS) is hoping that this will establish some discretion in people wanting the services of doctors and curb unnecessary expenditures from the Medicare Trust Fund.

Is this really going to work and cut the annual expenditures of Medicare? We’ll find out. Arguments on both sides of the aisle have been given, after 2020 that we’ll all discover the real outcome.

2020 Changes to Medicare Plan F

Changes to Medicare in 2020 will end up with the elimination of Medicare Plan F.

So what does all this mean for you as a medicare beneficiary? Is Plan F leaving the scene? Yes, BUT for new enrollees only starting from 2020.  There is a caveat to the whole situation as follows:

  • Those already on medicare supplement Plan F when 2020 arrives, won’t have to give up their coverage if they don’t want to. Individuals already on Medicare may continue their current Plan F policy or keep buying Plan F policies even after 2020 from other carriers. (As stated before, the MACRA act is only against Medigap Plans C & F sales to people newly eligible for Medicare coverage).

 

  • No worries if you have eligibility for Medicare before 2020 which is delayed because of your work status and employer insurance coverage. When the time comes and you make the switch to Medicare, you retain the right to get Plans C or F medicare enrollment. Just contact our medicare coverage helpline and speak with a licensed agent to find out what your options are.

 

  • People who gain Medicare eligibility only AFTER 2020 are not going to have this same right, though they will have the right to sign up for similar Plans D or G from then onwards.

The other well-known Medigap plans such as G and N will remain unchanged and available to everyone. In fact the standardized Plan G will become the new crown jewel on the medicare market.  Other than having to pay the Part B deductible, a Plan G provides coverage just a Plan F only it often has a lower price.  In addition, a new Plan G will be formed with high deductibles and it will be open to previously eligible and newly eligible applicants.

 

Will 2020 see the Rates of Plan F Start Rising Faster?

As one british officer said to the american officer in the film classic Bridge on the River Kwai “there is always the unexpected”. The unexpected is what concerns people when it involves a major rate increase for Plan F and it’s a certain possibility. When Medicare Supplement Plans H, I, and J were stopped back in 2010, some hefty price spikes occurred with some carriers almost immediately. However, Plan F’s discontinuation seems to present a different ball game as people already under the current structure will retain the right to make future Plan F carrier changes.

There is also a birthday rule in some states, giving people the freedom to switch Medigap companies with no underwriting during particular periods of the year. States with such a rule include New York, Connecticut, Missouri, Oregon, and California.  Contact our medicare coverage helpline at 866-936-3831 to find out more about the birthday rule for your state if applicable.

At least a single state has further enacted a legislation which seeks to ensure an increase in rates doesn’t affect policyholders of medicare supplement Plan F in particular. The Idaho Department of Insurance has established protective measures to prevent inflation on Medicare beneficiaries. A memorandum was published by them on the 17th of October 2017 which protects consumer.

What Does the upcoming Plan F Changes of 2020 Mean for You?

Below is our advice to you on the discontinuation of Medicare Plan F:

  • Now is the time to decide which coverage is best for you. If you feel great about Plan F, it’s still fine to go for it. You’ll have plenty of options should you decide to keep your plan f after 2020. So as long as you understand the risks of the inherrent risk of a rate increase with your plan f coverage then there is no reason to be overly concerned. As the old saying goes “there are many ways to skin a cat” meaning plan f is not the only way to get great medicare coverage.  Contact our medicare coverage helpline to find out how a medicare supplement Plan G or Plan N may meet your medicare insurance needs. The good news about Plan G and Plan N is —there not going anywhere now or in the foreseeable future! Plan G actually offers interesting potential savings. To learn more feel free to browse our medicare coverage helpline reviews here or contact a licensed agent today at 866-936-3831.

 

  • Stay alert for future updates through our posts. Medicare legislation changes very regularly and 2020 has a couple of years before it arrives. We could never really predict the other changes which may be added up before 2020 gets here. Be sure to get any worthy updates with us, so you may want to check our website regularly or like us on Facebook to get updates immediately we post them.

To find out about low priced options available to you, please click here in addition, you can speak with a licensed agent by calling  866-936-3831. Gary W Blackmon is licensed medicare insurance agent and helps customers from California to New York with their Medicare options. If you have any questions, need assistance in enrolling, or would like to obtain a quote for a medicare supplement plan f, please contact our medicare coverage helpline.

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