Medicare is changing in 2020. Here is what you need to know in order to avoid costly Medicare rate increases after these changes take place.
What’s the deal?
If you are familiar at all with Medicare Supplement Insurance then you know it is made up of different plans. Plan F is a very popular choice because it fills in all of the gaps of Medicare Part A & B. Unfortunately, congress will be phasing out Plan F in 2020 to move towards plans with co pays. If you have Plan F already, then you will be able to keep it. But no new Plan F policies will be able to be written after 2020. This brings concern of costly Medicare rate increases to those left in Plan F. Insurance was founded on the principal that many pay in and few collect (granted those that do collect, collect handsomely.) Obviously, Medicare works a little differently then most insurance but the principal still applies. This is how insurance companies were able to keep consumer rates low and pay out costly claims from their reserves. The more claims submitted, the less companies have in reserve to pay claims, the more premium that must come out of the clients’ pocket.
As the age demographic of Plan F begins to trend upward then the health issues will also trend upwards. Eventually, the company reserves will start to run dry and rate increases will be inevitable in order to pay for rising costs of health care.
So, what Should I do?
An alternative to Plan F is Plan G. It covers everything that Plan F covers except for the part B deductible. For 2019 the Part B deductible is $185. Did you know that Plan G typically runs $20 – $30 less per month than Plan F? So, if the premium savings for Plan G is equal to or more than $185, it makes sense for seniors to consider this option for future savings.
If you do decide to make this switch then you will want to do so while you are still healthy enough to make it through medical underwriting. If you are just turning 65 then you are in luck! You can apply for a Medicare Supplement at any time; however, there is a benefit to doing so during open enrollment. Open enrollment for Medicare Supplement Insurance begins when the applicant turns 65 and continues for the next 6 months. During this 6 month open enrollment period there is no medical underwriting.
If you have questions about whether or not this move would be a good thing for you to consider then reach out to our agency. We will be happy to help walk you through the options available to you! Or, head over to our events page to register to attend one of our Medicare Made Easy Lunch & Learn Events. Links to register are below!