A Medicare supplement is an insurance policy that helps pay for health care costs not covered by Original Medicare Part A and Part B. These are also called Medigap policies. Currently, there are ten different Medigap policies to choose from.
Medigap Plan E was the most popular of these in the recent past, but it was discontinued at the end of 2009.
This article will discuss what this plan involved, why it was discontinued, a good replacement plan, and what to do if you were enrolled in Medigap Plan E prior to 2010.
Why Was Medigap Plan E Discontinued?
Plan E was not the only one to get the ax in 2010. As of June 1, 2010, Plans E, H, I, and J were no longer available.
In 2008, the Medicare for Improvements for Patients and Providers Act (MIPPA) was signed.
This Act was part of a broad Medicare reform aimed mostly at Medicare Part D prescription drug plans. MIPPA spurred some of the first changes since Medicare Part D was enacted in 2003. MIPPA was aimed at regulating how Part D plans can be marketed to Medicare beneficiaries, and it also strengthened protections for beneficiaries.
MIPPA caused the low-income subsidy provisions of Part D to be expanded, which affected how the plans are designed, including coverage levels for specialty prescription medications.
These specialty prescription drugs were those used to treat diseases that would have severe, negative consequences if drug interruption occurred.
MIPPA also made it unlawful for low-income subsidies (LIS) to be penalized for Part D late enrollment.
Overall, MIPPA impacted every aspect of Medicare outside of Original Medicare. It has impacts on Part D plans, Medicare Advantage plans, and Medigap plans.
This Act reduced the number of standardized plans available to the public. Medigap plans are the only standardized plans. (Medicare Advantage plans are not standardized by the federal government.)
So, why plan E?
Plan E was deemed redundant. It was very similar in coverage to Medigap Plan D but also offered preventive care. One of the things that MIPPA reduced was the preventive benefits of Medigap plans.
The other plans that were also discontinued – Plans H, I, and J – were discontinued because they offered prescription coverage that was now available in a Part D plan. They were also deemed redundant due to the changes MIPPA provided.
What Did Plan E Cover?
Plan E covered some of the services not completely covered by Medicare Parts A and B.
- Part A coinsurance
- Part A hospital costs
- Part A coinsurance for skilled nursing facilities
- Part B coinsurance/copayments
- Up to 3 pints of blood transfusions
- Preventive care
- Medical costs during foreign travel
What Did Medicare Plan E Cost?
Premiums for Plan E differed across carriers, so it’s hard to say exactly what the premiums were. It is safe to say that the prices are increasing. From 1997 to 2000, premiums for Medigap Plan E rose 53%. The annual Plan E premium in 2000 was between $1300 and $1400.
What If I Was Already Enrolled in Plan E?
Because all Medigap plans are made equal, any insurance carriers that still have people on Medigap Plan E must continue to provide the same level of coverage.
The downside is that because fewer and fewer people are enrolled in Plan E, the premiums are continuing to rise. If you decide to switch to a plan that is currently offered, your premiums could be drastically reduced.
If you would like a comparable plan, Medigap Plan D is the most similar to Medigap Plan E.
Medigap Plan D
- Part A coinsurance and up to an additional 365 days of hospital costs after Medicare benefits are exhausted
- Part B coinsurance/copayment
- Blood (3 pints)
- Part A hospice coinsurance/copayment
- Skilled nursing facility care coinsurance
- Part A deductible
- 80% of foreign travel exchange
- No out-of-pocket limit
Plan G also has similar coverage and has additional benefits. It is one of the most comprehensive plans on the market today. It includes everything from Plan D, with the added benefit of covering any Part B excess charges.
Medigap Plan G
- Part A coinsurance and up to an additional 365 days of hospital costs after Medicare benefits are exhausted
- Part B coinsurance/copayment
- Blood (3 pints)
- Part A hospice coinsurance/copayment
- Skilled nursing facility care coinsurance
- Part A deductible
- Part B excess charge
- 80% of foreign travel exchange
- No out-of-pocket limit
There will be more changes to Medigap plans as the Medicare landscape continues to evolve. We recently saw a similar thing happen with Plan F. Fortunately, new plans are usually added at the same time that allows these changes to not cause too much trouble for their members.
Do you have Plan E or one of the other discontinued plans? You may benefit from switching to a new Medigap plan. Give The Medicare Gurus a call today and we can discuss your options!
