Medicare supplements help to pay for the things that Medicare doesn’t. They are an important part of protecting your nest egg against unforeseen and often expensive medical treatment.
However, Medicare supplements have rate increases every year, just like any other kind of insurance. Medicare beneficiaries enrolled in Medicare supplement Plan F are on the lookout for ways to lower their premiums.
Enter Plan G.
This policy works exactly like Plan F except that you pay the Part B deductible on your own. Here are three ways you can save money by opting for Plan G.
Plan G offers Lower Premiums
Since you agree to pay your own Part B deductible, Plan G gives you lower premiums in return. Sometimes when we run quotes, we find that Plan G might save you $200 – $300/year in premiums over the popular Medigap Plan F.
In 2017, the Part B deductible is only $183. So, if you save $300 on annual premiums by opting for Plan G, and you only paid back out $183 deductible, the you pocket $117 in savings.
Premiums for Plan G vary by zip code, gender, age and tobacco usage. Some carriers also offer household discounts for couples both enrolled in the same plan. Check with your insurance broker to get quotes for Plan G in your area.
Plan G has Lower Annual Rate Increases
Over the years, many people have opted for Plan F because is the fullest coverage policy. It covers both your hospital and outpatient deductible and all your cost-sharing. If someone has some health conditions, they will usually opt for Plan F because the like the idea of having everything paid for right from the first dollar.
We have also seen that many people who are healthy don’t plan to go to the doctor very often. These people often opt for Plan G because if they don’t have doctor appointment very often, they might not ever even incur the Part B deductible.
Because of this. Plan G has attracted a healthier pool of applicants over time. They have less losses than the people on Plan F overall. When an insurance carrier has a lower loss ratio on a certain block of business, they don’t have to increase the premiums as much every year.
This makes Plan G very appealing to many people.
Plan G is Around for the Long Term
Right now, there are millions of people enrolled in Medigap Plan F. However, in 2020 Congress is phasing out Plan F. They want all Medicare beneficiaries to have some deductible spending because they think this will help control costs.
If you have Plan f now, you can keep it and you will be grandfathered after 2020. However, new enrollees in 2020 and later will not have the option to buy Plan F. This might mean that we see Plan F take on larger increases after 2020 because there will be no new people joining that plan. People on Plan F will be a group that is steadily growing older.
Plan G, on the other hand, is not going away. Since there will be new enrollees joining Plan G regularly, this helps to balance out the existing members with a continuous stream of new, younger members. Many insurance agents believe that this makes choosing Plan G a wise choice.
Have you considered Plan G? If not, have your local Medicare insurance agent quote this plan for you. You just might find it saves you money on your Medigap premiums.