Page 17 - Evaluation for Jeanne Huybrechts
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Medigap policies -- an overview
Frequently asked questions about Medigap policies
What is a Medigap policy? What are the most popular plans?
It's a standardized supplemental insurance Plan F accounts for 40% of Medigap policies
policy that fills some of the gaps in Medicare sold, followed by Plan C at 13%. Of the four
coverage. There are 10 plans (see pp. 6-7). comprehensive plans that have higher cost
Medigap policies don't have network sharing, Plan N is the most widely sold.
restrictions, so policyholders can see any
doctor who accepts Medicare. Also, Are premiums based on my health?
Medicare makes the coverage decisions, not When you buy a policy during your initial six-
the insurance company. month open enrollment period, you cannot be
denied coverage or charged more because of
Which plans have the best coverage? pre-existing conditions.
Plans C, D, F and G all have solid What are the open enrollment rules?
comprehensive coverage. But they are also Even though you will not be asked health
the most expensive plans, and their questions during your initial open enrollment
premiums (like those of other plans ) are period, insurance companies may adjust
expected to increase by between 3% and 4% premiums based on your age, gender, and
a year. That means that a 65-year-old who smoking status. After the initial six-month open
now pays $2,000 a year for a comprehensive enrollment period is past, in most states you
Medigap plan will pay about $4,400 a year at will have to answer health questions before you
age 85. can get a premium quote.
People in good health might also consider Can I switch insurers and plans later?
one of the Medigap plans with higher cost- Yes, in many cases. And if your policy's
sharing -- Plans K, L, M, and N. Medicare now premiums increase by more than 4% a year, it
covers 100% of the cost of preventive may be time to shop around. Still, it's probably
services, which reduces your risk with these not wise to switch policies for minor premium
plans. In particular, Plan L and Plan N are savings, which may be the result of the timing
likely to save money for healthy people. of insurers' increases.
Which plans have the most risk? Another point to keep in mind is that if you
Plans A and B both have coverage gaps of have health issues it may be more difficult
almost $13,000 for skilled nursing facility switch to another insurer. In most states you
care. For that reason, they are riskier than might look for an insurer that uses a modified
other Medigap plans. Plan K also has fairly community rating in pricing its Medigap
sizable risk, but unlike Plans A and B, it has policies. This type of rating sometimes makes it
an out-of-pocket limit that offers some easier for older people as well as those with
protection. Only two Medigap plans -- Plan K serious pre-existing conditions to get affordable
and Plan L -- have out-of-pocket limits. Medigap policies.
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