High-Deductible Plan F is a version of Standard Plan F in which you absorb the early costs. Once you reach the deductible, the plan functions just like regular Plan F. People who have come from high-deductible or health savings account qualified plans in their workplaces are often interested in this plan.
Medicare Still Pays 80%
All Medigap plans supplements your Original Medicare benefits. So Medicare will pay its share, and you will pay your share.
With High Deductible Plan F, Medicare first pays its share. Then you agree to pay the first $2200 of your share (in 2017). That is your maximum out-of-pocket on High Deductible Plan F.
Let’s say you had a hospital stay early in the year. Medicare Part A will pay for the that hospital stay except for the $1316 Part A deductible that you will owe. Since you have a $2200 deductible on your Medigap plan, you will pay the $1316. That money applies against the $2200 that you are responsible for. If you have other charges through out the year, you will pay your share only until you have reached the $2200 limit.
Thereafter this plan works just like regular Plan F. It will cover 100% of your share on all Part A and B services.
Below is a chart of benefits for Plan F. The way to think about this is that everything below is correct AFTER you pay the first $2200. Each year, Medicare adjusts this deductible, so it goes up a bit over time.
High Deductible Plan F Pros and Cons
So why would anyone opt for a plan with a $2200 deductible?
The obvious reason would be that you will have lower premiums when you choose a High-Deductible Plan F. This appeals to people who have a significant amount of retirement savings. They can often afford to spend a little out of pocket in a year of higher healthcare usage.
In the last decade, many employer plans have had similar high deductible options where the premium for you and for your employer is lower if you enroll in a $4000 deductible plan as opposed to a $1000 plan. This is a very similar concept.
What’s the downside then?
Well, in our experience, many people who think they will like High Deductible Plan F ultimately don’t like it. They tend to feel nickled-and-dimed every time they go to the doctor because Medicare pays 80% and they get a bill for the other 20% (up until they meet the deductible). Some clients will call us back after a few months and change their mind, and want to then apply for a regular Plan F.
Don’t get us wrong – High Deductible F is a great value and many people who understand it like it fine. However, when you DO incur some deductible spending, you have to remind yourself that you have also been paying significantly lower premiums. You have saved quite a bit in monthly premiums than what you would have paid if you had enrolled in Standard Plan F.
Medicare Plan High Deductible F pricing varies among different insurance carriers, and not all carriers offer this particular plan. Our award-winning agency will assist you with comparing more than just rates. We’ll show you rate increase histories for each company and we’ll look at financial ratings as well. We can talk you through potential spending and help you decide if this less popular Medigap plan would actually be a good fit for you.