PSA: Medicare Supplement Plan F is on the way out, unless grandfathered before 2020

Miscellaneous and Personal Stuff I Must Share
1

I know some members of the board skew older and I haven’t seen a thread to this effect. It has been brought to my attention that Medicare Supplement Plan F will be phased out for new Medicare beneficiaries starting on January 1, 2020. If you’re already on supplemental Plan F, you’re grandfathered in and can keep it.

If you are buying supplemental insurance after the new year, another option is Plan G. Plan G is the same as Plan F except you have to pay your own $200 or so deductible each year before Part B kicks in.

Technically, if you are already on Medicare now and want to switch to plan F after the new year you will be allowed to. But it is unlikely that insurance companies will offer the plan any more.

This change is part of the Medicare Access and CHIP Reauthorization Act of 2015, codified as 42 U.S.C. § 1395ss(z). See the below spoiler for the text of the law.

[SPOILER]**42 U.S.C. § 1395ss. Certification of medicare supplemental health insurance policies.

…

z. Limitation on certain medigap policies for newly eligible Medicare beneficiaries**
[ol][li]In general[/li]Notwithstanding any other provision of this section, on or after January 1, 2020, a medicare supplemental policy that provides coverage of the part B deductible, including any such policy (or rider to such a policy) issued under a waiver granted under subsection §(6), may not be sold or issued to a newly eligible Medicare beneficiary.
[li]Newly eligible Medicare beneficiary defined[/li]In this subsection, the term “newly eligible Medicare beneficiary” means an individual who is neither of the following:
[LIST=A][li]An individual who has attained age 65 before January 1, 2020.[/li][li]An individual who was entitled to benefits under part A pursuant to section 426(b) or 426–1 of this title, or deemed to be eligible for benefits under section 426(a) of this title, before January 1, 2020.[/ol][/li][li]Treatment of waivered States[/li]In the case of a State described in subsection §(6), nothing in this section shall be construed as preventing the State from modifying its alternative simplification program under such subsection so as to eliminate the coverage of the part B deductible for any medical supplemental policy sold or issued under such program to a newly eligible Medicare beneficiary on or after January 1, 2020.
[li]Treatment of references to certain policies[/li]In the case of a newly eligible Medicare beneficiary, except as the Secretary may otherwise provide, any reference in this section to a medicare supplemental policy which has a benefit package classified as “C” or “F” shall be deemed, as of January 1, 2020, to be a reference to a medicare supplemental policy which has a benefit package classified as “D” or “G”, respectively.
[li]Enforcement[/li]The penalties described in clause (ii) of subsection (d)(3)(A) shall apply with respect to a violation of paragraph (1) in the same manner as it applies to a violation of clause (i) of such subsection.[/LIST][/SPOILER]

~Max

2

On the other hand it may well be financially worth it to switch to plan G even if you don’t have to. Look up the rates. In one instance I have read about the rates for the G plan were significantly lower than for plan F–and the difference was greater than this $200 or whatever ever deductible. So in all cases you were better off with plan G. I don’t know if this reflected the worse health of plan F vs G enrollees or if it was just a temporary teaser rate.

3

The interesting question will be what will happen to rates for Plan F as the pool of enrolees shrinks.

I have High Deductible Plan F and I have heard that there will be one for Plan G next year. I may switch.

4

Be very careful. In most states, if it has been more than six months since you first became eligible for Medicare, insurance companies can deny coverage or price discriminate due to pre-existing medical conditions[1]. They can also refuse to pay for care related to pre-existing conditions for up to six months after you enroll. This is because consumer protections from the Affordable Care Act did not extend to Medicare Supplement/Medigap plans.

~Max

[1] When can I buy a Medigap policy? | Medicare

5

Thanks. I am lucky to live in an enlightened state that allows me to change between any Medicare Supplement plan, at any time without penalty or underwriting.