Medicare supplement Plan F has been the most popular Medigap choice among beneficiaries for the last decade. It remains one of the most popular choices today but is quickly being replaced as the #1 supplement by Plan G. Regardless of its status, there is no doubt that it offers the most comprehensive coverage of any Medicare product.
How Medigap Policies Work
Most Medicare beneficiaries choose to supplement their coverage with Original Medicare (Parts A and B) with either a Medicare Advantage plan or a Medicare supplement plan, also known as a Medigap plan. You’ll need to understand how the two types of plans are different and how each works before deciding which route is best for you.
Today, we’re going to explain Medigap plans. The coverage they provide is more predictable because there are only ten Medigap policies to choose from: Plans A, B, C, D, F, G, K, L, M, and N. No matter where you purchase one of these plans, the coverage stays the same. They also don’t change from one year to the next. The only change you’ll see with a Medicare supplement is the premium. (They usually increase with age.)
You can think of a Medicare supplement as your secondary coverage after your primary coverage with Original Medicare. Whatever costs are leftover after Parts A and B pay their portion can be paid for by your Medicare supplement policy. The amount it will pick up depends on which of the ten plans you choose.
Let’s talk about what costs might remain after Parts A and B coverage.
Medicare Part A
Part A is hospital insurance. You’ll use Part A if you get admitted as an inpatient to a hospital. Right off the bat, you’ll be responsible for the Part A deductible of $1556. That deductible applies to each hospital admission, so it’s possible to pay the Part A deductible multiple times in one year.
Once you’ve met your deductible, Part A does give you 60 days of room and board with no coinsurance expense from you. From day 61 to day 90, your share will be $389 per day. After day 90, you can use any or all of your 60 lifetime reserve days if you have them available. If you do, your coinsurance expenses will be $778 per day. If you don’t, you’ll have no insurance coverage on day 91 and beyond.
As you can see, if you develop a serious health condition, your hospital expenses could add up quickly.
Part A also has similar benefits for an inpatient stay at a skilled nursing facility. You’ll need to meet your deductible again and then will have the first 20 days of your visit completely paid for by Part A. From day 21 to day 100, your coinsurance responsibility is $194.50.
Medicare Part B
Part B is outpatient insurance. You’ll use Part B for doctor’s visits, surgeries, diagnostic tests and images, durable medical equipment, and for many preventive care services. The Part B annual deductible is $233. Once you’ve paid the deductible, Part B works as an 80/20 split on Medicare-approved expenses. Part B will pay 80% of the cost, and you’ll be responsible for 20%.
One thing to understand about both Parts A and B is that there is no out-of-pocket limit to what you could pay during the year. This is quite different than an employer’s group plan, which usually has an annual maximum on what you have to pay out-of-pocket.
Now that you understand how Parts A and B work and what they pay, let’s talk about how Medicare supplement Plan F can help with all those leftover expenses.
Benefits of Medicare Supplement Plan F
Plan F has the most comprehensive coverage of any of the Medigap plans. It takes care of all those leftover expenses we just talked about. Beneficiaries who enroll in Plan F have virtually no out-of-pocket expenses. It’s easy to see why this has been the most popular Medicare supplement over the last decade.
Plan F covers:
- Part A deductible
- Part B deductible
- Part B excess charges
- Part A coinsurance and hospital costs
- An additional 365 hospital days after Part A benefits are exhausted
- Part B coinsurance and copayments
- 3 pints of blood
- Skilled nursing facility coinsurance
- 80% of a foreign travel emergency (up to plan limits)
Eligibility for Plan F
You must be 65 years old and enrolled in both Medicare Part A and Medicare Part B to be eligible for Plan F. You also must have turned 65 before January 1, 2020.
As of 2020, no Medigap plans were allowed to pay the Part B deductible. Since that was part of Plan F’s coverage, it will slowly be phased out of the Medigap options. Anyone who was already enrolled in Plan F is allowed to keep their plan, and it’s also available for those who turned 65 before the cutoff date, even if they delayed their enrollment.
If you are eligible for Plan F, you have “guaranteed issue rights” during your Initial Enrollment Period. The guaranteed issue right means that no insurance company can deny coverage based on your current or past health history. In addition, you will not have to answer health questions to enroll.
Once your Initial Enrollment Period has lapsed, you may not have the same rights. Each state is different, so you should work with your agent to determine which rules apply to you.
The Cost of Medicare Plan F
The amazing Plan F coverage does come at a price. Your monthly premium will depend on a few personal factors and some set by the insurance company. Your premium will be based on your age, gender, tobacco use, and where you live. (Higher premiums in higher cost-of-living areas.) The insurance company will use your personal information and set the premium based on its pricing method.
On average, we’re seeing the premiums range from $130-$230 per month for individuals in their upper-60’s. Since Medicare supplement plan premiums increase with age, your premium could be significantly more. We’ve also seen a more drastic increase in the Plan F premiums over the last couple of years since the plan is being phased out. While those premium jumps should level out soon, many beneficiaries are already struggling to pay the increased premiums. The good news is that there are some great alternatives to Plan F.
Alternatives to the Plan F Medicare Supplement
For those who are looking for lower premiums or who are not eligible for Plan F, Plan G is a great alternative. It may even be the better choice for many individuals.
Medicare supplement Plan G offers the same benefits as Plan F, except that it does not pay the Part B deductible. Based on the Part B deductible in 2022, that’s a coverage difference of $233. However, the lower premiums of Plan G may more than make up for that $233. As a result, many individuals could save more than that amount by enrolling in Plan G vs. Plan F.
Plan N is also a great choice for some individuals. Like Plan G, it also does not pay the Part B deductible. It also does not pay for any Part B excess charges. These are charges that some providers may add to the Medicare-approved amount for services. Some people argue that since excess charges are not common, this should not deter you from enrolling in Plan N. Plan N does require copays for office visits.
How to Enroll in Plan F
The easiest way to enroll in Plan F – or any other Medicare plans – is to work with a licensed insurance agent. Our Medicare advisors will educate you on the entire Medicare program and make sure you know about all of your options. We’ll get to know you and your unique needs so that we can make recommendations that make sense for you. Once you’ve decided on coverage, we’ll compare rates from many insurance companies so that you get competitive pricing. The best part? There’s absolutely no additional cost to work with one of our agents!
Call our office today to learn more about Plan F!
Does Plan F cover prescription drugs?
No, you’ll need a Part D prescription drug plan for prescription drug coverage.
Does Plan F cover dental care?
It may cover emergency dental treatment in a hospital setting, but it does not offer routine dental benefits.
Is Plan F the best Medicare supplement plan?
It does have the most benefits, but the best supplement is the one that works the best for you!
Is there a high deductible version of Plan F?
Yes, Plans F and G both have high-deductible options.
Is Plan F better than Medicare Advantage?
It does have the most predictable coverage but has higher premiums than you may find with a Medicare Advantage plan. Unfortunately, there is no one-size-fits-all in Medicare!