Is Medicare Plan F going away? Yes. As of 1 January 2020, this popular plan is no longer available to people turning age 65. But, don’t fret, you can still get excellent coverage.
What Happened to Medigap Plan F?
For decades, Medicare Supplement Plan F (aka, Medigap Plan F and Medicare Plan F) was the most popular supplemental Medicare insurance available. But, Congress passed a bill that forbids Medicare supplements from covering the Medicare Part B (medical coverage) deductible. The two policies that offer this coverage are Plan F and C, so they are no longer available to new policyholders.
Going forward, our plan options include A, B, D, G, (including a high deductible version), K, L, M, and N. As a result, Medicare Plan G is now the plan that offers the most coverage.
Why Did Congress Make This Change?
Every ten years or so Congress passes new laws that “modernize” Medicare. Back in 2003, they passed the law that gave us Medicare Advantage and Medicare Part D for prescriptions. Before that, in 1990, they passed a law that standardized Medicare supplements into the letter plans we have now. Then in 2010, they passed another law that eliminated Medigap plans E, H, I, and J.
Medicare Plan C and Plan F got the ax in 2020 because Congress wants seniors to have a little more skin in the game when they see their doctor. The Medicare Access and CHIP Reauthorization Act (MACRA) of 2015, signed by President Obama, is the law that made this happen. Congress and President Obama felt that, by allowing insurers to pay the Part B deductible, too many seniors were seeing their doctor needlessly, driving up costs.
Related Article: Is Medicare Plan G Better than Plan F?
MACRA is better known as the “doc fix” law. Congress passed the legislation so they could better compensate doctors for treating Medicare patients. And, there’s no doubt that we need our doctors to be fairly compensated or they will stop seeing us.
Taking Medigap Plan F away may seem like a slap in the face, but savvy seniors have known all along that they can get a Medicare Plan G, pay their own Part B deductible, and pocket the savings. That’s because most Medicare Plan F policies have an annual premium that’s greater than Medicare Plan G plus the annual Part B deductible.
From 2020 On, New Medicare Beneficiaries Must Pay Their Part B Deductible Out-Of-Pocket
As you probably know, both Medicare Part A and Part B (Original Medicare) have deductibles. Deductibles are what you pay out-of-pocket before insurance kicks in to pay its share.
With Original Medicare, the largest deductible is your Part A coverage for inpatient care. Fortunately, Medicare supplements can still cover this deductible. However, as of 1 January 2020, plans can’t cover the Part B deductible for your medical services (doctor visits, lab tests, etc).
Since Plan F and Plan C cover that deductible, these plans are no longer available to new enrollees. However, if you already have one of these plans you can keep it.
People with a Plan F policy have what’s known as first-dollar coverage. That simply means that from day one they are fully covered on all Medicare-approved services. Medicare covers 80% and their Plan F policy covers the rest. That’s a nice convenience, but it does not necessarily result in savings.
Going forward, Congress now knows that every Medicare beneficiary will pay their deductible out-of-pocket and think twice before seeing their doctor or going to the emergency room instead of making an urgent care appointment. Basically, they want you to think about whether a doctor visit is truly necessary.
Medicare Plan F in 2020 and Beyond
As previously mentioned, Medicare Plan F is no longer available to new beneficiaries. However, people enrolled in Medicare prior to 2020 will continue to have Plan F and C options in the future. For this reason, you will still see Plan F and Plan C listed on MedicareWire.
We’ve received calls and emails from people with a Medigap Plan F policy worried that they would lose their coverage. Don’t worry, because that won’t happen. If you have a Plan F policy already, you can keep your coverage. In fact, you find a better rate on a policy from another carrier you can purchase a new Plan F policy, as well. The new law only prohibits the sale of Medigap Plans C and Plan F to newly eligible Medicare beneficiaries as of 1 January 2020.
There has also been some concern coming from people who are still working and delayed enrolling in Medicare Part B. Here again, if you turned age 65 before January 2020, but you have delayed you delayed enrolling in Medicare Part B because you have insurance through your employer, you have no need to worry. When you switch to Medicare you retain your right to buy a Medigap Plan F or Plan C policy.
Will Medicare Plan F Rates Go Up?
When Medicare discontinued Plans H, I, and J back in 2010, rates did increase with some carriers. However, unlike Plan F, the change in 2010 did not grandfather people into Plans H, I, and J. Due to the fact that so many people are continuing to work past age 65, it’s likely that the number of people in the pool of Plan F policyholder will remain stable for a while. For this reason, MedicareWire expects that Plan F and Plan C rates will remain stable, increasing with inflation, for a while.
Also, if you live in California, Oregon, Missouri, Connecticut, or New York, your state has a birthday rule that allows you to change Medigap companies during certain times of year without any underwriting. This protects you from a wild rate increase on a Plan F or Plan C policy if that should happen.
Also See: How to Choose a Medicare Supplement Plan
What Does the 2020 Plan F Change Mean for You?
In all cases, make the best decision for you. If you have a Medicare Plan F or Plan C policy, and your carrier hikes your rates to a ridiculous level, you have the right to shop for a new policy. If first dollar coverage isn’t a concern for you, and you can pass all of the medical questions, you might consider choosing a Plan G or Plan N policy to get extra savings.
Do you have questions that we haven’t answered here? Call 1-855-266-4865 and let a HealthPlanOne agent answer your questions about your personal situation. There’s no obligation. Ask for your free rate plan analysis from all of the top carriers in your state.