Plan F is Going Away…How Does This Affect Me?

This is a question that I’m often asked in my educational workshops and one-to-one meetings with new or existing Medicare beneficiaries.

Medigap Plan F, also known as Medicare Supplement Plan F, has been one of the most comprehensive plans available and a top seller for beneficiaries. The appeal with Part F is that it covers all out-of-pocket costs for Part B, which include all copayments, coinsurance and deductibles, that typically a beneficiary would be responsible for.  However, Plan F will no longer be available for any newly eligible Medicare enrollees on or after January 1, 2020.

Why is Medicare Plan F being discontinued?

The decision to discontinue Medicare Plan F was made by Congress in 2015, which was part of the Medicare Access and CHIP Reauthorization Act.  Congress’ reasoning for discontinuing this plan was that they don’t want to offer plans that pay for all medical costs as they fear it motivates beneficiaries to seek medical care even when it isn’t necessary.  With this new bill, any new Medicare plans will no longer cover Part B deductibles, which in 2019, is $185.

What if I have Plan F already?

If you already insured by a Medigap Plan F, the good news is that you can keep it.  If you are a current Medicare beneficiary or you will become eligible for Medicare before January 1, 2020, you also can still enroll in Plan F.  Additionally, if you are a current Medicare beneficiary not on Plan F, you can enroll in Plan F anytime prior to January 1, 2020, or after this date.

However, those who chose to keep their Plan F coverage might discover that their rates will gradually increase as the number of Plan F policy holders decreases.

What are my options if I want to change from my existing Plan F?

Some beneficiaries might choose to leave their Plan F and enroll in another plan that isn’t being discontinued, such as Plan G, that offers the same coverage as Plan F, except for the deductible. Specifically, in 2019, under a supplement Plan G, you assume the Part B deductible of $185.  After this is paid, you receive the same coverage as Plan F with 100% of Medicare eligible expenses covered under Parts A and B.  By assuming the $185 deductible, policy holders for Plan G are rewarded with a lower monthly premium than they had with Plan F.

How much does Plan G cost?

On average, a switch from Plan F to Plan G will financially benefit you as your savings with a lower premium will offset the Part B deductible.  However, we strongly recommend that any Medicare soon-to-be enrollees review the cost and coverage options prior to picking a supplement plan.  If you would like to do a cost comparison with your current Plan F to Plan G, please give us a call.

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