Note: I thank Ron Iverson, president of NAMSMAP* for assembling this data. This information comes from the National Association of Insurance Commissioners. *National Association of Medicare Supplement and Medicare Advantage Producers. This article is a revision from one published earlier this year.
A Brief Summary
Plans C and F will not be available for people turning 65 after January 1, 2020. People on Medicare prior to that date can still purchase Plans C and F, subject to medical qualification in most cases. If you’re not a detail person, you can to stop here. For the mavens that enjoy knowing the full details, keep reading.
Now the Details and the Long Version
1) Why is the
standard model for Medicare supplement (Medigap) plans being revised?
A new federal law was passed on April 16, 2015. The Medicare
Access and CHIP Reauthorization Act of 2015 (MACRA) makes changes to Medigap
policies that cover the Part B deductibles for “newly eligible”
Medicare Beneficiaries on or after January 1, 2020.
2) What does MACRA require?
As of January 1, 2020, MACRA does the following:
2a) Prohibits first dollar Part B coverage on Medicare Supplement
plans (Plans C and F) to “newly eligible” Medicare Beneficiaries, so
Plans C and F cannot be sold to those “newly eligible” for Medicare.
Those enrolled in Plans C and F prior to January 1, 2020 may keep their plan.
2b) Makes Plans D and G the guarantee issue plans for
“newly eligible” Medicare Beneficiaries for the specified periods
under current law that name C or F for current Medicare beneficiaries.
2c) Who is considered a “newly eligible” Medicare
beneficiary under MACRA?
MACRA defines “newly eligible” as anyone who: (a)
attains age 65 on or after January 1, 2020, or (b) who first becomes eligible
for Medicare benefits due to age, disability or end-stage renal disease on or
after January 1, 2020.
3) How much is the Medicare Part B deductible?
Medicare Part B deductible is $185 in 2019.
4) How does this relate to efforts to eliminate Medigap or
Medicare supplement “first dollar coverage”?
This accomplishes the efforts to eliminate Medigap
“first dollar coverage” (coverage of all claims without paying any
out of pocket cost) by discontinuing sale of Plan C and Plan F only for
“newly eligible” Medicare Beneficiaries
5) How are people eligible for Medicare on the basis of
disability impacted by these changes?
Current beneficiaries are not impacted. The restrictions
under MACRA apply to persons who qualify for Medicare as a result of a
disability on or after January 1, 2020.
6) Why are plans “re-designated” for only “newly
eligible” Medicare beneficiaries?
The Federal Government wanted to eliminate coverage for the
Part B deductible making consumers responsible for that first dollar coverage.
The only difference between Plans C and F and Plans D and G is the coverage of
the Part B deductible under Plans C and F. All other benefits are exactly the same
for D and G. Since Plans C and F will no longer be available for “newly
eligible” beneficiaries, it was necessary to designate Plans C and F as Plans D
and G for these individuals.
7) How are enrollees in current Plans C and F affected by
Current enrollees (those eligible for Medicare PRIOR to January 1, 2020) can continue
with their Plan C or Plan F, including F High Deductible plan, and may continue to buy Plans C and F beyond
January 1, 2020. Current enrollees will also be able to buy the new Plan G
High Deductible plan on or after January 1, 2020.
8) What changes are made to High Deductible Plan options?
Since Plan F High Deductible cannot be sold to those
“newly eligible” Medicare beneficiaries, a new Plan G High Deductible
is created for those “newly eligible” Medicare beneficiaries as of January 1,
2020. The effective date of coverage for Plan G High Deductible must be on or
after January 1, 2020. If you are not a “newly eligible” beneficiary and are
enrolled in a Plan F High Deductible prior to January 1, 2020, you are able to
continue this coverage beyond January 1, 2020 and to purchase this coverage on
or after January 1, 2020.
9) When can the new High Deductible Plan G be sold and who
can buy it?
Plan G High Deductible can be made available beginning on
January 1, 2020; “newly eligible” Medicare beneficiaries and current
beneficiaries would be able to buy the new Plan G High Deductible.
10) For high deductible plans, does payment of the Part B
deductible count towards the plan deductible?
For Plan G High Deductible; while the Part B deductible is
not covered (reimbursed), it does count towards the High Deductible plan’s
deductible. If, in the rare circumstance the Plan G’s High Deductible is met
with all Part A expenses and Part B Deductible expenses are then incurred,
these expenses will not be covered expenses until the beneficiary meets the
Medicare Part B deductible.
11) For the new High Deductible Plan G sold on or after
January 1, 2020, what happens if a policyholder meets the high deductible
amount with all Part A out of pocket expenses?
If, in the rare circumstance the Plan G’s High Deductible is
met with all Part A expenses any Part B Deductible expenses incurred will not
count towards meeting the High Deductible nor will they be covered expenses.
12) What changes are made to Guaranteed Issue requirements?
Since two of the current guaranteed issue plans, Plans C and
F, will no longer be available for “newly eligible” Medicare
Beneficiaries on or after January 1, 2020, Plans D and G will become two of the
guaranteed issue plans for these individuals. Current enrollees can remain with
or buy Plans C and F and individuals who
do not fall within the definition of “newly eligible” Medicare beneficiary will
still be able to purchase Plans C and F.
13) How does this change the way Plans C or F, and D or G,
may be sold in the state?
Insurers can continue to sell Plans C or F to current
Medicare beneficiaries. However, “newly eligible” Medicare
beneficiaries cannot apply for or purchase Plan C or F. The “newly eligible”
would be offered Plans D or G on a guaranteed issue basis instead. All other
currently available plans may continue to be offered to all Medicare
beneficiaries regardless of their date of eligibility for Medicare.
You are NOT considered “newly eligible” because you turned
age 65 before January 1, 2020; and although you must enroll in Part B to
purchase Medigap and that would occur after January 1, 2020, you could purchase
C or F because you turned age 65 before January 1, 2020.
1) Plans C and F, and
High Deductible F, will not be available to anyone who turns 65 (“newly
eligible”) after January 1, 2020, including those eligible for Medicare by
reason of disability.
2) People currently
with Plans C and F and High Deductible F will
be able to keep them after the date.
3) People who turn 65
and register for Medicare before the date, can still purchase Plans C and F
because they are not considered “newly eligible.”
4) And…even though a
person who purchases Part B after January 1, 2020, they can still purchase
Plans C or F because he/she turned 65 before the date.
5) The current Plan C
will become (be designated) the current Plan D after the date.
6) The current Plan F
will become (be designated) the Current Plan G after the date.
7) All High
Deductible Plan Fs will be available as they currently are after the date, and
will become (be designated) High Deductible Plan G. Available purchase will include people who
turn 65 before the date, but again, not those “newly eligible.”
8) Guaranteed Issue (GI) Plans C and F will not be allowed
to be sold to newly eligible, but GI plans D and G will.
9) Plans K and L will
remain the same, with the exception of the yearly raise of out-of-pocket
10) Plans M and N
will not change.
11) The rules also apply
to “Medicare Select” plans.