Medicare and Medigap Trends – Five Things to Keep Your Eye On

going on medicareLike many things, insurance is always changing. This has been particularly true over the last few years, and we believe it will continue to be the case into the future. As such, it’s a good idea to keep an eye on some trends that affect Medicare and Medigap insurance. We’ve listed five Medigap trends here that are pertinent for people on Medicare.

  1. Doctor acceptance of new Medicare patients. Some people have been concerned about this for years, and we have heard reports of doctors not seeing Medicare patients in certain geographic areas. Overall, I don’t think this will become a prohibitive problem. But nevertheless, if it occurs in large numbers, it could create quite a “bottleneck” effect for Medicare patients at doctor’s offices that do accept Medicare patients.
  2. Reduction in number of choices in Medicare Advantage plans. This is a trend that is certainly already under way. In many counties, there were 20/30 + plan choices in past years. Those numbers have been greatly reduced, and there are now some counties that have just a couple of companies offering plans. This is due, at least in part, to government regulations that have made it more difficult to make money in and participate in this market. Overall, I think its clear that lack of competition will be a bad thing for the overall appearance of these plans.
  3. Growth of “newer” Medigap plans – a move away from Plan F. This, too, is a Medigap trend that has already begun in earnest. Plan F, which is the most comprehensive Medigap plan, still has the majority of the market share in Medigap plans. However, with the onset of the 2010 re-standardization of plans, there are new offerings, some of which may appeal to different people and have a lower premium. One of the plans that appears to have caught on the most is Plan N, which is a lower level of coverage that still offers comprehensive Part A coverage but does have some out of pocket costs under Part B charges.
  4. The Online Movement. Because you’re reading this online, we’ll assume this comes as no surprise to you. As the next generation of “age-ins” turns 65, the likelihood will continue to increase that they are computer-savvy and more and more comparing and shopping for Medigap and Medicare plans will be done online. Companies will continue to endeavor to meet this demand by making more and more information available online. This and other Medigap trends will certainly have an impact on how companies “market” to the new generation of turning-65ers.
  5. New Medigap Companies Entering the Marketplace. We have seen several companies that are new to the Medicare market enter the fray over the last couple of years, trying to capture the large influx of Baby Boomers aging into Medicare. This includes companies like CIGNA, AFLAC and others, who have either begun or expanded their Medicare plan offerings recently. This will likely continue, with companies that have not offered Medigap plans beginning to do so.

Overall, it is a good idea to stay apprised of any changes to Medicare and Medigap insurance. Certainly, all of them will not affect you, and some may not come to fruition, but being aware of them allows you to be prepared if or when they do.

As always, if you have any questions or want to discuss further, you can contact us at 877.506.3378 or online.

Medicare Supplement Plan G – A Simple Explanation of Why It Is a Good Deal

Medigap Plan G can be a viable alternative to the most common Medigap plan, Plan F. medigap plan gWhile many people know about Medigap Plan F and its advantages, Plan G is often a better “deal” and is worth examining.

First of all, let’s look at how Medicare Supplement Plan G differs from Plan F. As you may or may not already know, Plan F is, in addition to being the most common Medigap plan, the most comprehensive plan. It pays everything that Medicare does not pay on Medicare-covered services and procedures. With Plan F, you have no out of pocket costs. Many people choose that route for the mere simplicity of not having out of pocket costs or receiving bills for medical care. However, the only difference in Plans G and F is the coverage of the Medicare Part B deductible, which Plan G does not cover. For 2014, that deductible is $147/year.

Since the deductible that Medicare Supplement Plan G does not cover is only $147/year, and that is the only difference in the two plans, it is easy to compare the two plans (F and G) on the basis of cost. The deductible amounts to a $12.25/month difference. So if the premium savings is greater than $12.25/month, then Medicare Supplement Plan G would represent an annual savings. With many companies, the premium difference is $15-25/month, which would result in an annual savings.

That is just the straight-forward dollar amount savings, but there are other advantages to ‘G’ that should be understood. First and foremost, Plan G is historically more rate-stable over time than Plan F is. The reason for this can be a little complex, but here is an explanation of it. Plan F is offered on a “guaranteed issue” basis in certain situations, such as losing employer coverage or losing Medicare Advantage coverage. In other words, if you have pre-existing conditions, you may be able to get a Plan F but not a Plan G if you fall into one of those “guaranteed issue” situations. Over time, this leads to the people on Plan F being (on average) less healthy than the people on Plan G. This leads to higher claims ratios on ‘F’ and larger rate increases.

In an example, a well-known, ‘A+’ rated insurance company recently had a rate increase in North Carolina of 8% on Plan F and 5% on Medicare Supplement Plan G. This mirrors similar results nationwide and symbolizes why ‘G’ can be a better choice. It represents, not only initial premium savings in many cases, but also greater long-term rate stability.

A further advantage of ‘G’ comes if you are comparing plans mid-year and are already on a Medicare Supplement plan. The Medicare Part B deductible does not reset if you change plans. It is tracked by Medicare on an annual basis. So if you have a Plan F and you have been to the doctor and met your deductible (your plan would have paid it if you have Plan F), and you decide to switch to a Medicare Supplement Plan G, you would not have to meet the deductible again. So the premium savings the rest of the year would be realized in net savings to you.

While many people do not take the time to understand the plans or the various options that are available on the different Medigap plans, it can definitely make sense to do so and result in money in your pocket. If you have questions about this or want to compare Medicare Supplement Plan G rates for your age and zip code, you can contact us online at Secure Medicare Solutions or call us at 877.506.3378.