It can be confusing understanding how Medigap works along with Medicare. Basically, Medicare controls Medigap plans B, C,D and F and makes sure all Medigap insurers provide the same coverage at their own premium rate. As the insured, you pay a premium at the level of coverage you can afford and that best fits your needs. If you choose a higher premium, your deductible and co-payment costs are covered by your Medigap plan. If you choose a less expensive plan, your deductible and co-payment are paid out-of-pocket.
Medigap Will Cut Plan F After 2020
Plan F is a very popular Medigap plan. As with plan C, plan F (both are known as first-dollar coverage plans) allows policyholders to skip paying the annual deductible (rose from $147 to $183 as of 2017) under Medicare Part B for non-emergency medical care. Unfortunately, like plan C, plan F will be no longer be available. The reason? A new bill by Congress took effect on April 16, 2015 called the Medicare Access and CHIP Reauthorization Act of 2015.
Why Did Congress Pass this Bill?
Congress aims to reduce the overuse of medical services by requiring all Medicare members pay their part B deductible. Medigapplan F covers the part B deductible and will be subsequently dropped after 12/31/2019.
You might be concerned over your coverage being cancelled in 2020. In the bill, Title IV section 401 reads, “Limitation on certain Medigap policies for newly eligible Medicare beneficiaries. What does this mean?
Translation of Section 401
Section 401 of the 2015 Act prohibits insurance entities from selling Medigap policies that cover Part B deductibles to newly eligible Medicare beneficiaries including eligible individuals who enroll for Medicare due to age, disability, or end-stage renal disease (ESRD). Health waiver states are also affected by this prohibition.
The bill does NOT apply to existing Medigap enrollees. Additionally, all persons eligible for Medicare before January 1, 2020, can still buy Part B deductible coverage. Medicare beneficiaries under 65 can apply under certain terms and on a state-by-state basis. Medigap applications would be based on birthdate, ESRD or disability. Anyone enrolled in a Medigap Plan C or Medigap Plan F as of 12/31/2019 will be locked in under this plan and won’t be forced to switch plans.