Medicare Supplement Plan F or Medicare Supplement Plan G
Deciding between a Medicare Supplement Plan F or Medicare Supplement Plan G can be a tough decision for many seniors. To help, we’ll break down the differences between these two plans and clearly explain the reasons for choosing one type of coverage over the other.
Medicare Supplement Plan F and Medicare Supplement Plan G Benefits
Let’s start by taking a look at the benefits both of these Medicare Supplements, also known as Medigap Plans cover.
Medicare Part A Coinsurance (Hospital)
This benefit covers the coinsurance amounts associated with the cost of hospitalization (semi-private room, general nursing, miscellaneous services, and supplies).
Medicare Part B Coinsurance (Medical)
This benefit covers care given in or out of the hospital, including outpatient treatment (doctor services, supplies, speech and physical therapy, diagnostic tests, durable medical equipment).
Blood (First 3 Pints)
This benefit applies to both Part A and Part B of Medicare. Under most circumstances, blood is supplied free of charge via a blood bank. However, if there is a charge, Medicare only covers the cost after the first 3 pints. Both Medicare Supplement Plan F and Plan G cover the expense of the first 3 pints if there is a charge.
Part A Hospice Care Coinsurance and Copay
If you require hospice care, Medicare covers all costs except a $5 copay for prescription drugs and a 5% coinsurance for respite care. Both Medigap Plan F and Medigap Plan G cover the coinsurance and copays associated with hospice care.
Skilled Nursing Facility Care Coinsurance
For the first 20 days of care, Medicare covers all expenses. Days 21-100 Medicare pays all except $161. Days 101 and beyond, Medicare pays nothing. Medicare Supplement Plan F and Plan G will cover all coinsurance up to the 101st day.
Part A Deductible
Before Medicare pays any benefits under Part A, there is a deductible of $1,288 per benefit period (2016). The deductible is paid in full by both Medigap Plan F and Medigap Plan G.
Part B Excess Charges
These charges refer to costs under Medicare Part B that are above the Medicare approved amounts. For further information see The Truth About Medicare Part B Excess Charges. Medigap Plan F and Medigap Plan G are the only plans that cover Excess Charges.
Foreign Travel Emergency
This benefit covers emergency health care coverage when traveling outside the United States. However, the extent of this coverage will vary by company.
Medigap Plan F and Medigap Plan G the Difference
Now let’s look at the one difference between the two Plans. Medigap Plan F covers the Medicare Part B Deductible. Medigap Plan G does not. In 2016, the Part B Deductible is a one-time annual deductible of $166.
Not covering the Part B Deductible is one reason Medigap Plan G is the better choice. I’ll explain. Doctor visits are covered under Part B of Medicare and by not having first dollar coverage, insureds are less likely to see a doctor for minor or frivolous medical conditions. Fewer doctor visits result in fewer claims. Because of this, Medigap Plan G has historically had significantly lower rate increase when compared to a Medigap Plan F. Over the life of your policy these smaller increases can add up to tremendous savings.
Medicare Supplement Plan F is Being Phased Out
In 2020, newly Medicare Eligibles will not be able to purchase a Medigap Plan F. If you already own a Plan F you will be able to keep your plan. However, since no younger and healthier insureds will be entering the plan rates are guaranteed to rise. As the rates rise, anyone healthy enough will switch to another plan making the situation much worse for those who remain. It is highly recommended you change your Medicare Supplement Plan F coverage as soon as possible. Do not risk getting stuck with a plan that could potentially have skyrocketing rate increases.
Medicare Supplement Plan F or Medicare Supplement Plan G the Bottomline
Due to the historically higher rate increases and the phasing out of Medigap Plan F in 2020, It’s our opinion that a Medigap Plan G is a clear choice.