Medicare Supplement plans (sometimes called Medigap plans) are insurance plans that offer additional coverage to supplement the coverage provided by Original Medicare (Part A and Part B). A Medicare Supplement plan can help with some of the roughly 20 percent of out-of-pocket costs beneficiaries are responsible for after Medicare pays its share. So, many beneficiaries are glad to have the peace of mind that comes from the extra financial protection Medigap plans provide.
Medigap plans are standardized and identified by the letters A through N. Each lettered plan offers a different set of benefits. The benefits included in Medicare Supplement plans with the same letter are always the same (e.g., all Medicare Supplement plan As have the same benefits), regardless of insurance carrier, so the costs of each letter plan in any given service area are easy to compare directly.
Medigap Plan Changes in 2020
Medigap plans are great options for those who want more coverage than Original Medicare provides on its own. However, legislation that will go into effect in 2020 will impact which plans beneficiaries enrolling for the first time will be able to purchase.
Three Medicare Supplement plans — Plans C, F, and F High Deductible — were designed to pay for members’ Medicare Part B premiums (which are $185 per member in 2019). The new legislation no longer permits Medicare Supplement plans to pay Part B premiums, and, therefore, these three plans will be no longer be offered for enrollment in 2020.
What the Changes to Medigap Plans Mean for Beneficiaries
Plan F is considered the most comprehensive Medicare Supplement plan available, and Plan C, while less comprehensive, offers many of the same benefits. In 2020, however, people who are on Medicare but don’t have Medicare Supplement Plan C or Plan F won’t be able to buy them.
Beneficiaries who already have these plans will be grandfathered in under the new federal regulations and will be able to keep their plans for as long as they choose. If you or someone you love might benefit from enrolling in Plan C or Plan F before the deadline of January 1, 2020, there’s no time to waste.
- If you already have Plan C or Plan F: There’s nothing to worry about! You can continue renewing your plan each year and will continue to receive the full benefits of your plan. Anyone already on one of these plans as of January 1, 2020, can remain on that plan for life.
- If you are not yet on Original Medicare: If you want to enroll in Plan C or Plan F, you’ll need to enroll in both Original Medicare and Plan C or Plan F before January 1, 2020.* There is a seven-month Initial Enrollment Period (IEP) for enrolling in Original Medicare that begins three months before the month of your 65th birthday and ends three months after it. Depending on when you turn 65, you may want to consider enrolling right away, even if you are still working.
The best time to buy a Medigap policy is during your six-month Medigap Open Enrollment Period, which automatically starts the month you’re 65 and enrolled in Part B. During this time, you can buy any Medigap policy, even if you have health problems. After this enrollment period, you may not be able to purchase a Medigap policy, or it may come at a higher cost.
- If you are currently on another Medigap plan: You can switch to Plan C or F if you are still in your original Medigap Open Enrollment Period, which covers the six months that begin with the first month you had Medicare Part B coverage. If you are past that period, depending on the laws in your state and your health, insurers may refuse to cover you, or may charge a higher premium. There are several exceptions, though, so you should consult with a licensed insurance agent who understands the nuances of your coverage options to see if you qualify
- If you have a Medicare Advantage plan: You can drop that coverage and enroll in Original Medicare only during the Medicare Advantage Open Enrollment Period (OEP) or the Medicare Advantage Annual Enrollment Period (AEP). OEP, which is new for 2019, runs from January 1 until March 31, while AEP runs from October 15 until December 7. Once you return to Original Medicare, however, getting on a Medigap plan, including Plan C or Plan F, may be more difficult. You will likely have to undergo medical underwriting to determine whether you will be eligible for coverage and what your premium should be. Depending on the laws in your state and your health, insurers may refuse to cover you or may charge a higher premium. Again, we recommend consulting with a licensed insurance agent to help you understand what coverage option works best for you.
Even if you’re not sure switching to Plan C or Plan F would be good for you, there are many Medigap plans to choose from. Contact a licensed agent to find out what your options are!
* If you become Medicare eligible before January 1, 2020, based on disability or ESRD status, OR turn 65 before January 1, 2020, whether eligible for Medicare on that date or not, you would be eligible to buy a Plan C or F when you are entitled to Medicare Part A and enrolled in Part B. For example, if you continue to work past your 65th birthday and are covered by your employer’s group insurance plan, if you retire and enroll in Medicare after January 1, 2020, you will be eligible to buy a Plan C or Plan F during your six-month Medigap Open Enrollment Period.
Website last updated: 1/14/2019