Medicare is constantly changing, and this year is no exception. As we move from 2019 to 2020, you need to know the scoop on Medicare supplement plans and all the changes in the works. Keeping on top of your healthcare options has never been more important, and understanding the different Medicare supplement plans available to you and how the system works will keep you in control of your health.
Why 2020 Is Important
Medicare is making some changes in 2020 based on regulatory and law adjustments from the Medicare Access and CHIP Reauthorization Act (MACRA), which changes the way the government evaluates doctors and the way Medicare reimburses medical professionals for care.
These changes may make you want to adjust your coverage before January arrives. If you are a new enrollee, you should know that certain plans that have been available up until now are being done away with. There also some new policies available. Carefully consider your options so you can make the right choice in the coming year.
Medicare Supplement Plans Guide: What’s Changing
As you consider your plans for 2020, the first thing to be aware of is which options are disappearing.
Disappearing: Supplement Plans to Cover Original Medicare Part B Deductibles
Plans C, F, and High-Deductible F are disappearing because they covered 100% of Original Medicare Part B deductibles. These were sometimes known as first-dollar coverage plans because they started paying at the very first dollar.
Congress has eliminated first-dollar plans on the theory that they caused Medicare recipients to overuse the healthcare system. Moving forward, MACRA requires that every Medicare recipient pay something in the form of a deductible for the Original Medicare Part B services. The hope is that this will result in recipients only using the healthcare system when they genuinely need it, which will reduce costs and increase the availability of services to all.
Who Is Affected By This Change?
The change to Medicare supplement plans that cover Part B deductibles goes into effect on January 1, 2020. If you are eligible to begin your journey with Medicare before that date, you will still have access to the plans that cover Medicare Part B deductibles.
If your current Medicare plan covers your Part B deductible, this will continue to be the case even after January 1, 2020. You will be grandfathered in on your existing plan. However, if you choose to update to a different plan, you will not be able to find one that covers your Part B deductible.
What Is Available Instead?
To partially cover the gap that will be left when Medicare supplement plans C and F go away, Medicare is releasing a new plan: High-Deductible Plan G.
The new plan will be somewhat similar to the regular Plan G, but, as the name suggests, it will have a far higher deductible. This typically means lower premium costs, but Medicare has yet to release the full details about this plan. What we do know at this point is that Plan G will cover the deductible for Original Medicare Part A as well as copayments for in-hospital care and Part B outpatient services. It will also cover Part B excess charges and provide coinsurance for hospice and nursing care. It will cover 80% of foreign travel medical.
How Are High-Deductible G and F Plans Different?
Most agents and insurers are expecting the prices of these plans to be quite similar. The only real difference will be that HDG will not cover any Medicare Plan B deductible.
Who Should Choose This New Plan?
In general, the new plan will be best for those who want to have low monthly premiums and are willing to accept a high deductible in exchange. It will also be most appropriate for those without health challenges that require them to see the doctor frequently or spend a lot of time in hospitals. It’s a good choice for those who enjoy traveling abroad and also those who live in states that allow access charges.
If you are interested in high-deductible plan G, if you are currently on Plan F or Plan C, or if you won’t be eligible for Medicare until after January 1, 2020, and are unsure of your options, your best bet is to talk with an agent to compare plans and understand which one will be best for your health needs.
Other New 2020 Coverage Changes
Previous Medicare plans did not cover Telehealth benefits. That’s changing in 2020, and this will give Medicare beneficiaries the ability to talk to a doctor or other healthcare professional from home. The idea is to provide better care for those in rural areas or who have difficulty leaving their homes. At the same time, Telehealth has the potential to keep hospitals and doctors’ offices from being overrun with people who might not actually need to go there, but who can’t be sure until they’ve talked to a doctor first.
The Donut Hole
if you’re not familiar with the term, the phrase “donut hole” refers to the prescription drug coverage gap in Medicare Part D. Medicare Part D originally allowed this gap because it was believed it would lower expenses for Medicare in general.
Unfortunately, the donut hole had the opposite effect. Many drugs have no affordable generic options, and beneficiaries were stuck with medication bills they couldn’t pay and worsening health outcomes that put a strain on the whole Medicare system. Changes to the “donut hole” are the result of the Bipartisan Budget Act of 2018, which requires drug companies to get the same discounts to individual beneficiaries as they give to insurance companies. Medicare part D will still not cover prescription drugs, but the overall cost of these prescription drugs should decrease significantly.
Under the new rules, Medicare beneficiaries will only be required to pay 25% of the cost for brand-name drugs and 37% of the cost for generic brands.
An Overview of Medicare Supplemental Plans
Medicare supplement plans, sometimes known as Medigap plans, are designed to help beneficiaries pay for the costs that aren’t covered in Original Medicare, also known as Part A and Part B.
What They All Provide
All the plans cover coinsurance and hospital costs for Original Medicare Part A up to a year after your Part A benefits are used up. All the plans except K and L offer coinsurance or copayment for Original Medicare Part A hospice care and Original Medicare Part B and cover the first three pints of blood for needed transfusions. Plans K and L cover all the same things, but only at 50% for Plan K and 75% for Plan L. These plans are cheaper than the rest.
Plan A only offers the coverage detailed above.
Plan B adds coverage of your Original Medicare Part A deductible.
Plan C adds coverage of your Original Medicare Part A and Original Medicare Part B deductible and 80% coverage when abroad. This plan will discontinue on January 1, 2020.
Plan D adds coverage of your Original Medicare Part A deductible, coinsurance for skilled nursing facility care, and 80% coverage when abroad.
Plan F adds coverage of your Original Medicare Part A deductible, coverage of your Original Medicare Part B deductible and excess charge, coinsurance for skilled nursing facility care, and 80% coverage when abroad. There is also a high-deductible version of Plan F. Both will be discontinued on Jan 1, 2020.
Plan G adds coverage of your Original Medicare Part A deductible, coinsurance for skilled nursing facility care, Original Medicare Part B excess charge coverage, and 80% coverage when abroad. Starting Jan 1, 2020, there will be a high-deductible version of this plan.
Plan K offers no extra benefits beyond those described above.
Plan L offers no extra benefits beyond those described above.
Plan M adds coverage of up to 50% of your Original Medicare Part A deductible, coinsurance for skilled nursing facility care, and 80% coverage when abroad.
Plan N adds coverage of your Original Medicare Part A deductible, though with a small copayment, coinsurance for skilled nursing facility care, and 80% coverage when abroad.
Choosing Your Plan
As with any kind of insurance coverage, you can assume that plans which cover more have higher premiums. If you can’t afford the high premiums but have some money in the bank to pay a deductible, a high-deductible version of F or G can get you very good coverage for more reasonable prices.
Plan prices also vary by state, and if you live in Massachusets, Wisconsin, or Minnesota, the plans are standardized a different way. For most people, the best way to choose a good Medigap policy is to talk with an agent and discuss your health needs and financial situation.
Find Our More
The time to make your decision about Medicare supplement plans is now. The longer you wait, the more rushed you’ll feel, and if you like your current plan and want to keep it, you need to act before January 1, 2020. To learn more and talk with someone who can walk you through all your options, contact Senior Solutions Group today.