Many Medicare beneficiaries wonder what affordable plans are available in their area. Navigating the numerous letter plans, as well as keeping up with which ones are available, can be a daunting task.
We’re here to help make the task of searching for cheap plans a little easier. Below, we’ll discuss some of your options.
Affordable Medicare Plans
Part A provides hospital benefits and all services during a hospital stay.
Part B provides outpatient benefits which include doctor’s office visits, labs and diagnostic imaging, outpatient surgeries, physical therapy, and ER visits.
The leftover 20% is responsible for the beneficiary to pay out of pocket.
The remaining 20% can easily add up and cost beneficiaries a lot in out of pocket expenses.
The good news is, there are other cheaper plan options that you can add to Original Medicare.
Affordable Medicare Supplement Insurance Plans
The additional benefits can leave little to no out of pocket expenses for the beneficiary.
Generally, except for a few states, there are 10 letter plans. Each plan consists of a mixture of benefits to pairing with Part A and Part B.
The only difference with the plans is the cost, as each individual insurance carrier decides the monthly premiums and will vary on a variety of factors.
Age, gender, and location are a big factor in what each individual insurance company charges.
Additionally, there are different pricing methods:
- Issue-Age– premiums come from the age in which you buy the Supplement Plan
- Attained-Age– Premiums come from the age in which you buy the insurance but will also increase as you age
- Community-Rating– premiums are the same because of where you live regardless of age.
To reiterate, each letter plan has the exact same benefits regardless of where you live; however, the premiums will vary because of the insurance company.
Top Affordable Medicare Plans
Plan G benefits include coverage for the Part A deductible, as well as the 20% coinsurance and copayments.
It also covers excess charges and medical emergencies while traveling abroad. The only thing it does not cover is your Part B deductible.
Plan N is one of the 4 “cost-sharing” plans. Plan N is one of the more affordable Supplement Plans but provides fewer benefits.
It offers coverage for the Part A deductible, medical emergencies while traveling abroad, and the 20% not covered by Medicare.
Plan N does also cover 100% of the Part B coinsurance. The “cost-sharing” term kicks in here because you do have to share the cost on this one a little.
There’s a copayment of up to $20 for some office visits and up to a $50 copayment for an emergency room visit that does not result in being admitted into the hospital.
Plan C is the next affordable supplement plan on the list.
It’s very comparable to Plan G, with only two differences. Plan C does not cover excess charges; however, it DOES cover your Part B deductible, unlike Plan G.
Keep in mind, excess charges are not very common, not having coverage for this may not impact your out of pocket costs at all.
Also important to note, 1st dollar coverage plans, including Plan C, will be going away in 2020.
You can still sign up for Plan C now and will be grandfathered in. But after January 1st, 2020, you will no longer be able to sign up for Plan C.
Which of these Options are the Cheapest
Of these more affordable plans, Plan N, in most cases, comes out to be the cheapest option. With Plan C next in line, followed by Plan G. Again, the cheaper the plan the lesser the benefits.
Why is Plan F Not One of the Cheaper Medicare Supplement Plans
You may be wondering why Plan F is not on this list.
That’s because, even though it’s one of the most popular plans, it’s not the most affordable Medicare Supplement Plan.
With higher premiums comes more benefits. It also comes with lower out of pockets costs in the long run.
Plan F is one of the most expensive plans, so if you’re looking for cheaper premiums, Plan F is not for you.
It’s also going away in 2020, including the High-Deductible Plan F.
High Deductible Plan F premiums are much cheaper than the regular Plan F, due to the higher deductible.
You’ll have until the end of 2019 to enroll in HD Plan F as well.
However, there will be a new high deductible plan introduced, the High Deductible Plan G.
“Zero Premium” Medicare Advantage Plans
Now, Plan C is NOT the same as PART C. Part C is the Medicare Advantage plan.
With Medicare Advantage (MA), you get what you pay for.
Part C is Medicare Replacement Plans. They REPLACE both Part A and B. You CANNOT have an MA plan & Medicare Supplement Plan at the same time.
Beneficiaries are attracted to MA plans because of the lower, or $0-dollar premiums. However, many restrictions do apply. Most MA plans come in PPO or HMO form and have a smaller network of physicians and hospitals to choose from.
Additionally, most MA plans require referrals for specialists and outside diagnostic testing and treatments. While these plans offer cheaper premiums, oftentimes there are coverage limitations that can offset the lower premium charges.
Due to many agents advising new beneficiaries to join an advantage plan, without explaining the many restrictions, Medicare was forced to bring back the Open Enrollment Period.
Too many beneficiaries were signing up for “affordable” Medicare Advantage Plans, then quickly realizing they did not have the coverage they wanted or needed. But they were stuck with the plan until the next Annual Enrollment Period.
Starting in 2019, if you signed up for an advantage plan that didn’t allow you to see the doctor you wanted to see or didn’t cover the pharmacy of your choice, you have another opportunity to switch back to Medicare.
You can instead pick up an affordable supplement plan and Part D. You can also switch to another advantage plan if you wish.