Medigap Plan M: the Deductible-sharing Plan
Medicare Supplement Plan M is one of the new supplements created by the Medicare Modernization Act. It first hit the Medicare insurance market in the summer of 2010. (Sometimes we hear people call it Medicare Part M or Medigap Part M, but the correct term is Plan M.)
Medicare Plan M provides the same basic benefits as other supplements. However, it has a slightly reduced monthly premium in exchange for your willingness to pay half of your hospital deductible and all of your annual outpatient deductible. By sharing in these deductibles as well as excess charges, you get the benefit of reduced premiums.
Plan M could be a good fit for someone who doesn’t expect to visit the hospital often and feels he can afford the occasional cost-sharing. However, it’s important to have a licensed agent who specializes in Medicare supplements to help you. He or she will evaluate the differences in premiums and make sure that the savings are worth the risk of some expenses.
Medicare Plan M scenario
Mrs. Rudd buys a Medigap Plan M for her coverage. She feels she will enjoy the savings on the premiums. She also has a decent nest egg to pay for the occasional 50% co-insurance on the Part A deductible that she may incur. A few years into her policy, she needs knee surgery which requires an overnight stay in the hospital. Mrs. Rudd will pay $644 in 2016 for her share of the Part A deductible.
Plan M will also cover most of her outpatient followups. Though she must first pay the annual Part B outpatient deductible, Medicare pays 80% of her outpatient care after that. Her Medicare Supplement Plan M picks up the other 20%. If her knee surgeon does not accept Medicare’s assigned rates, she will also pay the Part B excess charge. That excess charge is limited to 15% above what Medicare allows the doctor to charge. So the potential cost sharing on excess charges is minimal enough that Mrs. Rudd feels comfortable.
Medigap Plan M Insurance Carriers
Every Medicare supplement carrier chooses which plans it will offer for sale unless state law requires the carrier to offer certain plans. Because most people don’t understand cost-sharing, they tend to fear it, and therefore we see few carriers offering Plan M for sale. Trying to track them down can be a chore, but if you get assistance from a Boomer Benefits licensed agent, we can provide quotes for you right over the phone or via email.
We are contracted with many Medigap insurance companies in most states. Contact our agency using this online request form for quotes for quick no-hassle quotes.