The Best Medicare Supplement
What makes a Medicare Supplement the best?
That’s a really good question and the answer is fairly simple. Let’s start with what a Medicare Supplement is. Medicare Supplements are also called Medigap Plans because they pay the difference between what Medicare pays and what you would be left paying. They fill the gap leaving you with little to no out of pocket cost depending on the plan you choose.
There are only 11 Medicare Supplement Plans available on the market.
The plans are all pretty straight forward on what is covered and out of the 11 plans there are only 3 you really need to know because probably 98-99% of all Medigap clients are on 1 of the 3 plans. Plan F, Plan G, or Plan N pretty much offer something for everyone and which one you choose is usually based on health and budget.
On the flip side of the simplicity of Medicare Supplements are Medicare Advantage Plans. There are approximately 2200 Medicare Advantage nationwide and benefits vary from plan to plan.
What is the difference in the Medicare Supplement Letter Plans?
The simple explanation is no matter if you get your Plan F from Mutual of Omaha, AARP, Cigna, Aetna, Loyal Christian Benefits, BCBS or any one of the 10-20 companies who sell a Plan F in your State or County, the core benefits are exactly the same. I repeat all Plan F benefits are the same no matter which company you choose. As a matter of fact they are exactly the same in 47 of the 50 states. The only states that have their own system are Massachusetts, Minnesota, and Wisconsin.
So the same principle applies to each letter plan. All Plan G’s are the same. Al Plan N’s are the same and so on throughout the plans. All companies that sell these plans offer the same Medigap benefits and this is mandated by the Federal Government. You and I cannot do a secret handshake and me sell you a better Plan G than your neighbor Fred has.
So what is the difference? Price! All 20 companies that sell in your state can manipulate price all day long, but never the benefits. That is where the logic of shopping your plan every couple of years comes in. New companies come into the market and older companies offer new plans under a different umbrella of their company so they can offer more competitive pricing. Take Mutual of Omaha, there is the company branded name. They also offer United World, Omaha Insurance and many of the other companies do the same. Benefits don’t change, but the name of the company and the price change all the time. So the next time a broker like myself calls and states they might be able to save you $600-$1000 per year, don’t say I am happy with what I have. My plan pays pretty good! All of the plans pay the same way! They don’t have a choice. They only choose what they charge.
Which Medigap Plan should you get?
Once again there are only 3 plans you should look at and that is Plan N (good), Plan G (better), or Plan F (best). I am only referring to benefits and not the big picture. With Plan F you pay a monthly premium and nothing else. No co-payments! No networks! Nothing but premium. Plan G is just like Plan F with the exception of Plan g makes you responsible for the first $183 Part B deductible in 2018. Part B is doctors visits, durable medical equipment, and part b drugs like in office chemo. After $183 is paid by you, not another penny. Plan N is the same as Plan G except you may be responsible for $20 co-payments at the doctor and a $50 co-payment at the ER if you do not get admitted to the hospital. Oh, Plan N does not pay excess charges like Plan F and Plan G do. There is rarely ever a physician you will find that charges excess charges.
Out of the 3 plans they are exactly as you would suspect when it comes to premium. Plan is is the most affordable, Plan G is next and Plan F has the largest monthly premium based on the level of benefits they provide.
By reading the above you might think wow, Plan F, is what I need. So hear is what you don’t know and brokers like myself do know, “Plan F has the highest premium increase every couple of years somewhere between 8%-13%. Plan N and Plan G are much better with 3%-6% premium increase. So that should definitely factor into your decision making process.
Why can’t I change letter plans as price or my health change/
There is only 1 company that will let you change plans without Medical Underwriting. So let’s say you start with a Plan N because it is more affordable, but 2 years down the road you run into a multitude of health problems and want to change to a Plan G or Plan F, that may not be an option for you. Remember you get one free shot into a Medicare Supplement at 65 or when you retire at an older age. That free shot means there are no health questions. But, after that you will be medically underwritten and could potentially be denied.
I always recommend for my clients to get what they are comfortable with based on their current health and budget, but at the end of the day I am always going to recommend Plan G for it’s comprehensive coverage and a lesser premium than Plan F.
Summary of Medicare Supplements
I think the thing that amazes me the most are clients who choose to get a Medicare Advantage Plan because it is cheaper and I am fairly healthy. So, First, MA plans can cost anywhere from $0-$$120+ per month and you can be responsible for up to $6700 out of pocket in a single year. $6700 is not a reasonable amount that you have time to budget for. Medicare Advantage Plans have restrictive networks.
I would rather pay as little as $1200 a year for a Plan G and know I can go to any facility or physician in the United States with no out of pocket cost except the initial $183 deductible for Part B. I can budget $100 per month on a fixed income than I can trying to come up with $6700.
The initial question, “Which Medicare Supplement is Best?”, can be answered with any one of the 3 plans, F, N, or G, and the company you should choose is one that is the least in cost…same benefits…different price between companies. If you want the help of a broker, call me, email me, or go to our quote request page and enter your information. We do not charge for any service we provide you and all we do is Medicare. 800 708 5810 Check out “How to Get the Best Medicare Supplement Video”
Check out our YouTube Channel. Please subscribe for new videos and leave us your comments.
Also published on Medium.