If you’re new to Medicare, you’ve probably got lots of questions. You’ve also probably heard a lot about Medicare supplements and Plan G in particular since it’s so popular among Medicare beneficiaries. But what is Plan G? Is it right for you? To find out, you’ll need to understand how a Medicare supplement works and what benefits you can get by enrolling in Plan G.
Medicare Supplements: An Overview
First, let’s review a common mistake in Medicare lingo. “Parts” of Medicare refer to Parts A, B, C, and D. Part A is hospital insurance, and Part B is outpatient insurance. Medicare Part C is Medicare Advantage plans, and Part D refers to prescription drug plans. Medicare “plans,” when paired with a letter of the alphabet, refer to Medicare supplements. The current Medicare supplement plans are Plans A, B, C, D, F, G, K, L, M, and N.
The federal Medicare program standardizes the ten Medigap plans (another word for Medicare supplements). That means that each of these plans stays the same, no matter who you purchase them from. For example, plan G at Company X is the same as Plan G at Company Y. Also, these plans will never change their benefits; they remain the same year after year.
Medicare supplement insurance plans help pay for expenses that remain after Medicare Parts A and B have paid their portion. Each of the ten plans has different benefit amounts, but they all work the same way. Let’s talk about the costs associated with Medicare Parts A and B so you’ll know how to compare Medigap policies.
Part A Costs
As we mentioned earlier, Part A is your hospital insurance. It will cover your room and board expenses during an inpatient hospital stay. The first cost you’ll have with Part A is the deductible, which is $1556 per benefit period. (A benefit period could occur more than once in a calendar year.)
Once you’ve paid $1556, you’re first 60 days of a hospital stay require no coinsurance payments from you. From day 61 to 90, you’ll be responsible for $389 per day. After day 90, your Part A benefits are exhausted unless you have the 60 lifetime reserve days remaining. If so, your coinsurance portion will be $778 per day.
Part B Costs
Part B is your outpatient insurance. Part B offers assistance for doctor’s visits, lab tests, surgeries, durable medical equipment, and preventive care. The Medicare Part B deductible is $233 per year. After you’ve paid $233, Part B will pay for about 80% of any Medicare-approved services you receive.
One thing to note about Parts A and B is that there is no yearly out-of-pocket limit on what you could pay. This is different than what you may be used to with a group health insurance plan.
If you’ve been adding numbers in your head, you’ve probably noticed that if you have any health condition, your medical expenses could quickly add up. That’s where Medicare supplements come in!
Plan G Coverage and Benefits
One of the most popular plans is Medigap Plan G, and it’s easy to understand why.
Remember all those out-of-pocket costs we talked about? Medigap Plan G will pay for all of those costs except the Part B deductible.
Plan G also has a foreign travel exchange benefit. If you need medical care during the first 60 days of a trip, Plan G will pay for up to $50,000 in benefits per lifetime. You will need to pay a $250 deductible, as well as 20% of the cost.
What does Plan G cost?
Premiums for Plan G will depend on factors that vary by individual. Your monthly premium will be based on your gender, age, tobacco use, and where you live. Insurance companies can also set their premiums, so you should always compare premiums from several companies. The average premium for a 65-year-old enrolling in Plan G is between $100-$200.
To be eligible to enroll in Medicare supplement Plan G, you must first be enrolled in Original Medicare.
How to Enroll in Plan G
If you’ve decided to enroll in Medicare Plan G or have more questions about your Medicare options, work with a licensed health insurance agency that understands your needs. An agent can answer questions, compare plans, and find the insurance company that will offer you the most competitive rate. Medicare can be confusing, but it doesn’t have to be hard. Make it easier by calling one of our Medicare advisors today!
Is Plan G better than Plan F?
The Plan G benefits are slightly less than Plan F benefits, but the lower premiums usually make up for the difference in benefits.
Does Plan G pay the Part B annual deductible?
No, the only plan that does that is Plan F, but not everyone is eligible for that plan.
Do supplements have extra benefits?
No, a Medicare supplement will only cover things that Original Medicare covers.
What is Medicare Part F?
There is no Part F. If you hear this, the person was referring to Plan F.