Among the commonly-available plans, Medigap Plan G provides coverage to supplement Medicare that is 2nd only to Plan F. In some states, Plan C is a viable option. But, in most states, Medicare Plans F, G and Plan N are the plans that are offered most widely and by the most companies. If you would like us to compare Medicare Supplemental plans, we are happy to assist you in finding the plan that best suits your individual needs. If you already have a plan such as Plan J, we can answer any questions you may have concerning your coverage.
WHAT DOES MEDIGAP PLAN G COVER?
Plan G is very similar to Medigap Plan F. It has only one difference in benefits from the “first-dollar” coverage of Plan F – that is the coverage of the Medicare Part B deductible, which Plan G does not cover.
Below is a listing of the “gaps” in Medicare that Plan G DOES cover:
- Medicare Part A coinsurance and copayments, as well as additional 365 days at the hospital
- Medicare Part B coinsurance and copayments
- First 3 pints of blood
- Part A hospice care coinsurance and copayments
- Skilled nursing facility coinsurance and copayments
- Medicare Part A deductible
- Medicare Part B Excess charges
- Foreign travel emergency up to plan limits
If you have Medicare Supplement Plan G, your only exposure to out-of-pocket costs on would be the Part B deductible. For 2015, that deductible is $147/year.
HOW DOES PLAN G WORK?
Medicare supplement Plan G works just like other Medigap plans. The Medigap plans are Federally-standardized, so coverage with one company is the exact same as coverage with another company. Insurance companies that offer Medigap plans must abide by the Federally-published Medigap coverage chart, which dictates the benefits offered under each plan.
With Medigap plans, there are no networks. This means that you can go to any doctor, specialist, hospital, etc that takes Medicare. There are no referrals required, no networks, and no in-network/out-of-network differences in benefits. If a doctor accepts your primary coverage (Medicare), they are required to accept your Medigap coverage.
Also, claim payments are processed through the Medicare “crossover” system. This is an automated system Medicare has in place to coordinate claims payments between Medicare and your secondary/supplemental insurance. When you go to the doctor, the provider files a claim to Medicare, which then initiates the “crossover” with your Medigap plan to ensure payment from the Medigap company directly to the provider.
Medigap Plan G pays on the same time schedule and in the same amount, regardless of what insurance company your plan is with.
With these considerations in mind, it is important to compare companies based on price when comparing options. Since coverage, doctor acceptance and claim payments are equivalent, price is the primary determining variable of which company is the best option.
IS IT THE RIGHT OPTION FOR ME?
Plan G is certainly one of the more common Medigap plan choices. In recent years, many companies have begun to offer it as one of their primary plan choices. It is priced as such also, becoming one of the more competitive parts of the Medigap market. So, who is Plan G right for? Does it make sense for you?
The short answer is… it depends. Medigap rates vary by zip code, age, and gender. So the first steps to seeing if this plan is right for you is understanding the plans and getting customized quotes for the plan options in your area.
Once you do that, you can do the math. It’s simple math to do. The only difference between Medicare supplement Plan F and G is the coverage of the Medicare Part B deductible, which is currently set at $147/year (for 2015). If the premium savings is greater than the $147/year deductible, then Plan G probably makes more sense than Plan F.
If you are comparing Plan G to some of the other plan options that are lower tiers of coverage, you should compare the benefits that you will receive on this plan against the premium you will pay.
If you are just going on Medicare or turning 65, keep in mind that you can sign up for any plan at that time on an open enrollment basis. But after that initial open enrollment, you may have to ‘qualify medically’ to change plans. So it is important to think about it long-term. With Medigap plans, you can NOT buy the level of coverage you need when healthy, then switch to better coverage when you have a health problem. That would certainly make it an easier choice if that were the case. However, with this type of plan, you do have to think long-term or “big picture”.
MEDICARE SUPPLEMENT PLAN G RATE STABILITY
Along those same lines, Plan G is historically more rate-stable than Plan F and some of the other plans. This is because some plans are offered on a “guaranteed issue” basis in certain situations, such as losing employer/group coverage or losing Medicare Advantage plan coverage. Plan G is not one of the plans offered in these such situations.
Generally speaking, to sign up for Medicare supplement Plan G, you have to do it when you turn 65, or first go on Medicare, or you have to “qualify medically” to do it. This means that people that have Plan G are, on average, a healthier “population” than those that have Plan F.
So, in addition to looking at the actual, current rates for the plans you are comparing, it is prudent to also look at rate stability for both the companies you are considering and the plan you are considering.
MEDIGAP PLAN G IN THE FUTURE
Recent legislation has threatened “first-dollar” coverage that is offered on some of the Medigap plans, such as Plan F and Plan C. These “first-dollar” plans pay everything that Medicare doesn’t cover without the policyholder having any “skin in the game”.
These proposed changes, which are currently set to take effect in 2020, do not impact plans in which the policyholder is responsible for some of the gaps in Medicare (i.e. Plan G, in which the insured pays the Part B deductible).
Because of these changes, the popularity and long-term viability of Plan G is poised to grow in the future. In reality, some companies have already adapted to the coming changes, reducing pricing on Plan G while Plan F rates have continued to increase. Moving forward, this appears to be a definitive trend in Medigap plans.
HOW TO FIND THE BEST MEDIGAP RATES
Because they are Federally-standardized, Medigap plans should be compared primarily on price and company reputation. The plans all work the same way and provide the same benefits. So, you should endeavor to compare based on price.
There are several ways to do that. One option is to contact each company that offers plans in your area and get a rate sheet. Most companies do not publish this information online. Even when information is published online, it is advisable to contact them to get current information, as online information can be dated or inaccurate.
Obviously, this would be a huge undertaking since there are 30-40 companies in the Medigap market in many areas.
So, the preferable way to do it would be through an independent agent/agency or broker. This way, you can compare all options in a centralized place and get unbiased listing of rates as well as historical rate increase/plan stability information. This costs you nothing and allows you to make an educated, informed choice based on all options in your area.