Q: I currently have a Plan F medigap policy, but I’d like to lower my premiums. Any suggestions?
A: Plan F is still the most popular plan, but two newer types of medigap plans can help you reduce your premiums in return for more cost sharing. The premium savings could be so great that unless you have a lot of visits to the doctor or emergency room, you might come out ahead.
The first is a high-deductible version of Plan F. It has the same coverage you have now, but you must pay for Medicare-covered costs up to $2,110 in 2013 before the policy pays anything. In exchange, the premiums tend to be much lower than for a standard Plan F. For example, a 65-year-old woman in Miami might pay nearly $260 per month for a standard Plan F but less than $85 per month for a high-deductible Plan F, saving $2,100 per year in premiums, according to eHealthMedicare.
Another interesting new policy is Plan N. It provides most of the same coverage as Plan F, including the full $1,184 Part A deductible, but it doesn’t cover the $147 Part B deductible. It charges a $20 co-payment for doctors’ visits and a $50 co-payment for emergency room visits. Several insurers’ Plan N policies would cost the Miami woman less than $200 per month. If the premium difference is $720 per year for Plan F versus Plan N, she’d still come out ahead with Plan N if she had two emergency room visits and fewer than 23 doctors’ visits. (For more information about each type of medigap plan, see “How to Compare Medigap Policies” at Medicare.gov.)
Because every medigap plan with the same letter designation has the same coverage, it’s easy to compare prices. Most state insurance departments list prices for medigap policies available in your area. Visit the National Association of Insurance Commissioners’ website (naic.org/state_web_map.htm) for links to your state insurance department. You can also get price quotes and buy medigap policies from many insurers at eHealthMedicare.com. The Medicare.gov Medigap Policy Search tool (medicare.gov/find-a-plan/questions/medigap-home.aspx) can also help you find medigap policies in your area.
Kimberly Lankford is a contributing editor to Kiplinger’s Personal Finance magazine and the author of Ask Kim for Money Smart Solutions (Kaplan, $18.95). Send your questions and comments to email@example.com.