Medicare Supplement Plan G
For those who are newly-eligible for Medicare, Medicare Supplement Plan G is going to be the supplement plan you want to look at first.
Medigap Plan G will be the supplemental plan with the highest amount of benefits for those who were not Medicare-eligible until after 2020.
The Ultimate Guide to Medicare Supplement Plan G in 2020
Once upon a time, Plan G was the runner up among supplement plans. It’s now moved on up to become the most popular plan.
Why? Because for those who are not eligible for Medicare until after 2020, the previous most popular plan, Plan F, is not within your bucket of plan options. The reason for this is due to MACRA.
However, Medicare Plan G is very comparable to Plan F. In fact, even those who are eligible to enroll in Plan F tend to go with Plan G. This is due to the monthly premium being lower.
In fact, for some beneficiaries, Medicare Plan G can turn out to be a more cost-effective plan option when compared to Plan F.
With that said, let’s get into it!
What is Medicare Plan G?
Medicare Plan G is one of the many Medigap plans that help you fill in the holes in coverage when you only have Original Medicare benefits.
Plan G is Great for Those Who:
- Want comprehensive coverage
- Want a plan with stable rate increases
- Don’t want out of pocket costs like copays or coinsurance
- Live in a state(s) that allow excess charges
- Travel outside the U.S. to vacation
Original Medicare consists of both Part A and Part B. Both parts have deductibles, coinsurance, and copays that you, the beneficiary, are responsible for paying.
These out of pocket costs can quickly add up.
Real-World Example of How Plan G Works
Roger ended up in the hospital due to an illness. That illness left him in the hospital for a few weeks, as well as multiple follow up visits and tests with his primary physician.
Part A pays his hospital expenses, but still leaves him with a deductible of $1,408.
Then Part B pays for the follow-up visits with his primary, minus the Part B deductible and 20% leftover after Medicare pays their share.
His follow up doctor visits and tests had a total cost of $30,000, he’s left responsible for 20% of that.
Thus, leaving his total out of pocket costs to be $4,000 + the inpatient deductible for $1,408 + the outpatient deductible of $198.
Now, if Roger had Medigap Plan G, his carrier would’ve been billed all the above. Instead of a statement that would’ve been over $5,600, he would’ve only received one for $198.
However, if he already paid that annual deductible from a previous visit, he wouldn’t have received a bill at all. All of Roger’s medical expenses would’ve been 100% covered.
The above example is using a minor illness; a severe illness could be financially disastrous.
If you want to know which carriers offer the best Medicare Plan G policies, you can read some reviews here.
What does Medicare Supplement Plan G Cover?
Anything that Medicare covers, Plan G will also cover, minus the outpatient deductible of $198. It covers your inpatient hospital costs, as well as outpatient.
Inpatient is any services you receive at the hospital; those fall under Part A. Outpatient is any services you receive at the doctors’ office; those fall under Part B.
Also, if you enjoy traveling overseas, Plan G covers up to 50,000 in foreign travel emergency benefits.
Medicare Supplement Plan G Comparison Chart
Medicare Plan G vs. Part G vs. Medigap Plan G
All of the above are the same thing. Medicare Plan G is the same as Medigap Plan G or Part G.
Technically, Part G is incorrect terminology, but those who understand Medicare will know you’re referring to Plan G. There is no such thing as Part G.
Original Medicare has Parts; supplemental insurance has Plans.
How Much Does Medigap Plan G Cost?
The overall average monthly premium is around $110.
With all Medigap plans, the cost of each plan depends on many different factors. However, the benefits are standardized.
Standardized benefits mean that regardless of the carrier you go with, the benefits will remain the same.
The only difference between Plan G with one carrier vs. another carrier is the monthly premium. You may find that the same plan, with the same benefits, costs less with a different carrier.
That’s precisely why it’s essential to work with an agent that is licensed to work with multiple carriers. This ensures you get a non-biased quote & can compare all carriers side by side.
The other factor that comes into play here with the cost of Plan G is that state the beneficiary resides. The premium is different from state to state.
Plan G Cost Example
For instance, if you live in Florida, the average monthly premium for Plan G could be anywhere between $160-$200. If you live in Texas, the average monthly premium is between $96-$205.
Now, if you live in a state that has a lower cost of living, you can expect to pay a little less.
What is the Deductible for Plan G in 2020?
With Plan G, the only deductible you’re responsible for is the Part B deductible, which is $198.
An Alternative to the Standard Plan G
For those looking for a smaller monthly premium without sacrificing benefits, there is an alternative to the standard Plan G.
Now, this plan is very new. Due to the MACRA changes, High-Deductible Plan G was introduced in 2020.
This high-deductible plan offers beneficiaries a lower monthly premium in exchange for a high deductible. The deductible is $2,340.
If we go back to or above example, the high deductible version of Plan G has a monthly premium of around $46 in Florida and $30 in Texas.
Another good alternative is Plan N. Plan N has a small copay for ER visits & doctor visits. There is a loophole with this. If you go to an urgent care center, there is no copay!
In exchange for the above copays, you’ll have a lower monthly premium. For example, in Florida, the premium for Plan N starts at around $130. The premium in Texas starts at about $80.
Plan N is a good alternative for those who are looking for a lower monthly premium without having to meet a high deductible before their benefits kick in.
Is Plan G a Guaranteed Issue Plan?
Previously, Plan G was not a Guaranteed Issue plan. That means those with Guaranteed Issue Rights could not use those rights to enroll in Plan G.
Once again, these rules changed due to MACRA. For those who were eligible for Medicare before 2020, those rules still apply.
However, if you’re newly eligible for Medicare starting this year, you can use these rights to enroll in Plan G. This is because you’re not eligible for Plan F, which does accept Guaranteed Issue.
Plan G for Those Under 65
If you’re on Medicare & under 65, you may not be able to enroll in a Medigap plan. Not all states offer these plans to beneficiaries under 65.
If your state does offer plans to those under 65, the premiums are astronomical. There are a few states that don’t increase your premiums if you’re under 65. Some states are Illinois, Tennessee, and Pennsylvania.
Does Medicare Plan G Cover Prescriptions?
For any medications given in an outpatient setting that fall under Part B, Plan G will cover any coinsurance.
However, when it comes to prescriptions that you pick up from the pharmacy, you’ll need a stand-alone Part D prescription drug plan.
Does Medicare Plan G have High Rate Increases?
Another reason this is a favorite supplement plan among beneficiaries is due to the history of lower rate increases. When compared to Plan F, Plan G has a smaller rate increase from year to year.
Should I Switch from Plan F to Plan G?
This is the question we get asked the most when clients are inquiring about Plan G. The answer comes down to the cost difference between the plans monthly premiums and the Part B premium.
If you multiply the monthly premium for Plan F x 12 months, and then Plan G x 12 months and the difference between the two is more than the Part B deductible of $198, then it might make sense for you to switch to Plan G.
For example, if you’re currently enrolled in Plan F, and the monthly premium is $180, then you’re paying around $2,160 a year for the plan.
If you’re enrolled in Plan G, and the monthly premium is $150, then you’re paying around $1,800 a year for the plan.
That’s a $360 a year cost difference.
Since the only difference between both plans in the Part B deductible of $198, if you switch from Plan F to Plan G, you would be saving around $162 a year in premiums. ($2,160-$1,800 = $360 – $198 = $162)
Additionally, if you happened to have already met the Part B deductible, you wouldn’t be required to pay the deductible again until the following calendar year.
Is Medicare Plan G Going Away?
No, Plan G is not a first-dollar coverage plan. You can continue to sign up for this plan after 2020. Only first-dollar coverage plans, such as Plan F & Plan C, will be eliminated.
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