High Deductible Plan F Medicare supplement insurance can be a policy choice. It offers low monthly premiums in exchange for higher out-of-pocket expenses. In fact, HD Plan F offers some of the lowest rates of any supplement on the market.
Traditional Plan F can be a better choice for those who would rather have no deductible. Insurance companies are not required to offer HD Plan F, so consumers won’t have quite as many options to compare.
Our independent insurance agency offers both High Deductible and Traditional Plan F from several highly rated and dependable carriers. (We offer all other plans as well in many states across the country.)
The plan itself is fairly straightforward and works like all other Medicare supplement insurance coverage. The only difference is there is a one-time deductible that must be met each year before the insurance company will pay benefits. (Medicare will always pay its share first, but your HD Plan F won’t fill in any gaps until the deductible has first been reached.)
In 2019, the amount that must be met for High Deductible Plan F is $2,300. It was $2,240 in 2018, $2,200 in 2017 and $2,180 in both 2016 and 2015. Typically the increase is about $20-$40 a year when there is one. The amount is determined by the Centers for Medicare and Medicaid Services and based on inflation measurements. Increases affect all plans – both new and old.
Currently, Plan F is the only supplement offered in a high deductible version. However, legislation passed in 2015 states no plans covering the Part B deductible will be available for purchase starting in 2020. This means, Plan F, C and HD Plan F will be phased out. Those already enrolled will be able to keep their coverage.
One disadvantage would be if the insured decided later on that s/he no longer wanted the policy. Oftentimes when the insured wants to purchase more comprehensive coverage, it’s because they are reaching the deductible on a more regular basis.
Someone who was once in good health, but later finds that the $2,000 + deductible must be met each year might want a better policy. It can be difficult to pass medical underwriting and switch plans when in poor health however. With most providers in most states, the insured cannot purchase new coverage without first passing medical underwriting questions/interviews.
In a nutshell, switching can be difficult in the future. Contrary to popular belief, there is no open enrollment period each year for Medicare supplement insurance. In most cases, underwriting will still be required during the yearly Annual Election Period that occurs in the fall.
The time period from October 15th to December 7th each year (collectively known as the Annual Election Period or AEP) is for changing Part D plans and/or Medicare Advantage coverage, but it does not allow the insured to choose any new supplement without undergoing medical underwriting.
Two states, Missouri and California, do offer an open enrollment (yearly anniversary) window each year when the insured can change plans, but this is only for “like or lesser” supplements. Upgrading coverage may not be possible in using these windows either.
Typically those who purchase High Deductible Plan F fit into a couple of categories. Generally speaking, they are in good health, have enough savings to cover the deductible year over year, and do not like the hassle associated with network driven policies like Medicare Advantage plans.
The primary advantage to HD Plan F is lower monthly premiums. Many consumers do not worry about potentially paying a $2,000 + deductible each year as they are leaving group health insurance plans with similar deductibles.
Additionally, Medicare supplements do not have network restrictions like most other types of health insurance plans. The insured is still free to choose any doctor or hospital accepting Medicare and does not need to worry about referrals.
Seniors who travel often or who have a residence in more than one state will likely choose a traditional Medigap plan like High Deductible F knowing that they can receive routine care both in and out of their primary resident state.
Hyers and Associates is full service, independent insurance agency offering supplemental insurance policies direct to consumer in several states. We work with the leading providers in order to secure the lowest rates for our clients.
Category: Medicare Supplements