Attained Age vs Issue Age

Medicare Supplement Insurance Companies all price their plans differently. One of the biggest differences between plan prices is whether or not an insurance company uses attained age vs issue age to price their Medigap plans.

Background Information: What is a Medicare Supplement?

Medicare Supplement plans, also called Medigap Plans since they cover the gaps in Original Medicare coverage, are issued by private insurance companies.

Click here to read a simple, but comprehensive introduction to Medicare Supplement (aka Medigap) Plans.

Standard Coverages from Each Medicare Supplement Plan

The government tells each company what should be included/covered in each Medigap Letter Plan. As a result, they are standard in coverage. However, the insurance companies can price each plan differently, and each company does so according to its needs in each market (part of the country) they sell in.

Medigap Costs & Pricing Considerations

The way each private insurance company prices its plans has an effect on what the plan will cost you now, and then again down the road as premiums are re-evaluated each year.

Medigap Plans do tend to increase in price each year (some more than others if new people cannot enroll in them, such as Plan F or C).

Shop Your Plan, While You are Healthy

As a result, it is a good idea to shop your Medigap Plan year to year if you are still healthy enough to get medically underwritten into a new plan. (What this means is, switching Medigap plans, when you are not guaranteed to be issued one, is dependent on you being healthy enough for an insurance company to accept you into the new plan.)

• Call an Independent Insurance Agent to see what options are available to you in your area. (Ask about Plan G.)
  
• Call Carly, your Medicare Author and Independent Agent if you life in Nebraska or Iowa. Or if you live elsewhere, find an agent here.

Attained Age vs Issue Age vs Community Rated Pricing

Remember, when you are comparing private insurance companies plans, pricing is the only difference between letter plans. The coverage is the same for each letter plan, and set by the government, so pricing is your biggest consideration.

Additionally, you need to consider HOW the plan is priced, not just WHAT each plan costs. The way each plan is priced will affect how the price changes year-to-year.

There are three ways that insurance companies can price their Medigap Plans: Attained Age, Issue Age, and Community Rated Pricing.

Attained Age Pricing of Medigap (Medicare Supplement) Insurance Plans

Attained Age Plans are priced (or rated) based on your current age.

Medigap plans that use this pricing are based on your attained age. Your plan price rises as you get older. Premiums might start lower for younger beneficiaries on these plans, but when they hit certain ages set by the plan, their premiums will increase.

Attained age plans can also go up because of other factors (such as inflation or company actuarial assessments.)

Issue Age Pricing of Medigap Plans

Issue Age Rated Policies (or “entry age-rated”) have premiums based on the age you are when you purchase your plan. Or, as CMS puts it, when you are “issued” the plan. For example, when buying a new plan, a 70-year-old beneficiary will pay more for the same plans as a 65-year-old beneficiary.

This means that the younger you are when you buy this kind of policy, the less you will pay for it. In addition, the policy will not go up in price as you age, because of your age. It may go up for other reasons, but not because of your age.

Community Rated Pricing of Medigap Plans

The CMS (Centers for Medicare and Medicaid Services) and private insurance companies sometimes call Community Rated Plans “no-age-rated” plans, as their pricing has nothing to do with the age of their beneficiaries.

The price of the plan is not dependent on your age. If the plan goes up, it is not because your age went up. The increase in price may have been dependent on other factors (such as inflation).

Other Pricing Considerations

Insurance companies have other ways to raise or lower their Medigap Plan prices. According to CMS, these include:

• Plan discounts like household discounts, smokers ratings, or payment processing discounts.

• Discounts for people that apply through medical underwriting versus being a guarenteed issue.

• Using “Medicare Select” network providers in certain types of plans.

• Choosing “high-deductible” versions of specific Medigap letter plans.

Conclusions and Actions

In conclusion, since each private insurance company can price their plans differently, it is important to ask how your current supplement is priced or supplements you are considering are priced.

The pricing structure affects not only what you are paying now for your Medigap plan, but what you will also be paying in future years.

Again, call Carly, your Medicare Author and Independent Insurance Agent if you life in Nebraska or Iowa. Or if you live elsewhere, find an agent here.

Further Reading

• Read this article, if you need guidance on deciding what Medicare Plan type is right for you.

• Start here, if you need to learn the basics of Medicare, who can get it, and what it covers.

• Need to know how to apply for Original Medicare? Read this.

• Need Part D Coverage Information? Read this article on Prescription Drugs Coverage.

• Finally, start with this article, if you want to read the differences between the two paths of Medicare: Medicare Advantage vs Medigap.

The post Attained Age vs Issue Age appeared first on Medicare Life Health.

Medicare Part B Excess Charges are important to understand when you are deciding what Medigap Plan (Medicare Supplement) to get.

Every once-in-a-while, we hear from a client that is confused about a doctor’s bill. They are confused that there is a fee they need to pay that Medicare didn’t cover that they thought was covered by Medicare. Moreover, they have a supplement, that they believe should have also picked up the rest of the cost.

Often times, this fee turns out to be an “excess charge.” Let’s see what this means.

Excess Charges in Medicare Defined

Excess Charges are amounts of money charged by doctors or other healthcare providers above what Medicare has stated it will pay for a specific service. In other words, the amount of money charged above the Medicare approved amount is the excess charge.

Basically, your doctor or healthcare provider is more expensive for a particular service than the Medicare approved reimbursement. If this is the case, you either have to pay the excess fee out-of-pocket, or you might have the fee picked up by your Medigap (aka Supplement) plan.

Medicare Supplements and Excess Charges

Beneficiaries of the Medicare Healthcare System use Medicare Supplements to pick up the costs that Original Medicare does not pay. (Medicare picks up 80% and beneficiaries pick up 20%, unless they have a supplement or a Medicare Advantage Plan.) These costs include co-payments, co-insurance and deductibles. Medicare

Supplements pay some or all of these extra costs, depending on what plan you get.

What Medigap Plans Cover Excess Charges?

Plan F and Plan G Cover Excess Charges.

• If you have aged into Medicare before 2020, you can pick either Plan F or Plan G. The only difference between Plan F vs Plan G, is G does not cover the Medicare Part B Deductible.
• If you age into Medicare after 2020 (i.e. your 65th birthday is on or after January 1, 2020) then you cannot get Plan F. Plan G would then be your only option for a plan that covers Part B excess charges.
• To read more about why this birthday cut off exists, please read this article.

All other plans do not cover excess charges. If you have any of the other Medicare Supplement (Medigap) Plans, you will be responsible for paying excess charges.

Is My Service or Procedure Covered by Medicare?

If you are trying to figure out if your needed service or procedure is part of Medicare’s covered services, and/or how much is covered, then start with the Medicare.gov web-page here.

Medicare Advantage & Excess Charges

If you have a “Part C” Medicare Advantage (MA / MAPD) Plan, then excess charges do not apply to you. Medicare Advantage Plans basically replace Original Medicare and cover all of the services they are required to, plus many have additional coverage and benefits.

Your specific Medicare Advantage plan costs will be outlined by your private insurance company. So, you will know exactly what is covered and what costs you are responsible for according to your plan. In addition, your plan may have a network of doctors that have negotiated rates with your plan, so excess charges may not even be relevant to your MA set-up.

Further Reading:

• Medicare Supplements vs Medicare Advantage

• How to Choose a Medicare Plan

• How to Apply for Medicare

• What is Medicare Plan F?

• What Medicare Part B Covers & Costs

• 5 Biggest Medicare Mistakes

The post What are Part B Excess Charges? appeared first on Medicare Life Health.

As a Medicare Health Insurance Agent I hear this question over and over: “Is Medicare Plan F Going Away?” The simple answer is, no, Plan F is not going away. However, not everyone can sign-up for it as of January 2020.

Who Can Still Get a Medigap Plan F?

Medicare Beneficiaries who turned 65 prior to January 2020, are eligible to purchase a Plan F Medicare Supplement. They will either have to have a special enrollment period for guaranteed acceptance, or go through Medical Underwriting to get into a plan.

Need Some Background Information? Please Read:

• What are Medicare Supplement Plans?
• What is Medicare Plan F?
• Medicare Supplements, aka Medigap vs Medicare Advantage
• What do I get with Original Medicare?

Who Cannot Get a Medigap Plan F?

Beneficiaries who turn 65 after January 2020, are not eligible to purchase a Plan F Medicare Supplement.

Why Can’t Some People Purchase a Plan F?

Well, the government set a new rule that says anyone that turns 65, on January 1, 2020, or after, cannot purchase any supplement policy that covers the Medicare Part B deductible. This includes Plan F and Plan C.

In 2021, the Medicare Part B Deductible is $203..

Click here to read all the 2020 Changes and Updates to Medicare Part B.

Medicare Supplement (Medigap) Plan Chart

Wondering what the difference is in Plan G vs Plan F? Here is a Medicare Supplement (Medigap) Plan Chart to remind you of what letter Plan covers what.

Plan G is More Competitive

The good news is that Plan G Medigap Plans are typically much more competitively priced than Plan F’s. Moreover, the only difference between the two plans is Plan F covers the Medicare Part B deductible, while Plan G does not.

Additionally, the Medicare Plan G Supplements are usually still less expensive than Plan F’s even after adding back in the Part B deductible.

Even if you are 65 years old before January 1, 2020, it is a good idea to see if you could save money by switching to a Plan G if you now have a Plan F.

Just know, You will have to pass medical underwriting to switch plans. Plan F’s will not have the ability to add younger (potentially healthier) beneficiaries to their pool. As a result, these plan prices will most likely rise at a faster rate than plans that can add younger people.

Plan F vs Plan G – How do They Work Differently?

Again, the only difference between Medigap Plan G and Plan F, is that Plan F pays the Medicare Part B Deductible and Plan G does not.

Part B pays for Medical Insurance. This includes:

• Outpatient
• Home Health
• Doctors
• Health Care Providers
• Durable Medical Equipment
• Prevention

Each year, when you use these types of services, you will pay the Part B Deductible ($198 in 2020) first. Then, you will pay no other costs as everything else will be picked up by your supplement.

With Plan G Supplements sometimes being up to $900 a year cheaper, it makes a lot of sense to see if you are eligible to switch to one or start on one.

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