Ever heard folks talking about Plan F or Plan G? Those are Medigap plans. Here, we'll explain what they are and why we think Plan G is a good fit for folks who want the most coverage.
Medigap plans exist to - you guessed it - fill the gaps in Part A (In-Patient Coverage) and Part B (Out-Patient) coverage. They are plans that are subsidized and defined by Medicare but offered by private insurance carriers. What that means is you'll purchase a Medigap plan from a private carrier, like Cigna or Anthem, and that the benefits of the same plan are the same across carriers. Plan G from Cigna is the same as Plan G from Anthem. If you buy a Medigap plan, you'll pay a premium for it on top of the Part B premium you're already paying.
At first, choosing a Medigap plan can be daunting because there's a literal alphabet soup of options. There's Plan A, Plan B, Plan C, Plan D, Plan F, Plan G, Plan K, Plan K, Plan M, and Plan M. Here's a description of their benefits:
Whew! That's a lot of information. Let's go through this table by choosing one of the plans with the most checkmarks: Plan G. With Plan G, you get:
Now let's get to choosing a plan. In the world of insurance, paying more doesn't always get you better coverage. A plan's premium is dictated by a number of factors, one of which is how many people are enrolled in it. Generally, the more people enrolled in a plan the lower its premium.
This relationship between coverage and premium is important to remember because around two-thirds of the people enrolled in Medigap plans are enrolled in Plans F or G. They offer the most coverage of all the Medigap plans but aren't the most expensive. As an example, consider the average prices of Medigap plans in California for a 65-year-old non-smoking female from carriers with at least an AM Best rating of "A-".
Looking at this data, we can immediately rule out five out of the 12 Medigap plans available. Here's how:
So we've whittled down our options to G, A, L, N, K and the high deductible versions of Plans F and G. Which one you choose depends on the prices unique to you (we used averages) and how much coverage you want. For folks who want maximum coverage, Plan G is usually the best fit. Go to www.fairsquaremedicare.com to see how much you'd pay for Plan G.
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