Supplement Plan Changes on the Horizon

Changes Coming After the New Year

The National Association of Insurance Commissioners recently announced the changes about to take place to the federally standardized Medicare Supplement Insurance product line up.  There will be no changes between now and December 31, 2019.

However, beginning January 1st, 2020 and thereafter, newly enrolled Medicare beneficiaries will have fewer choices with the selection of their Medicare Plan and older Medicare enrollees will be Grandfathered and allowed to continue to purchase the same plans available today on the market.

Medigap Plans C and F are Going Away

CMS and Medicare did not change the structure of any of the plans.  But, on or after 1/1/2020 Grandfathered Medicare beneficiaries will still continue to be able to purchase Medicare Supplement Plan C and F alongside plans: A, B,D,G,K,L,M, and N.  

However, newly enrolled Medicare patients will no longer be offered Medigap plans C and F.  In place of the guaranteed issue provision currently being offered through these two plans, CMS has granted the guaranteed issue feature for plan G.   Over time this will likely increase premiums on plan G as more seniors begin enrolling under this plan without any medical underwriting.

Why is CMS Making These Changes?

CMS is making an attempt to phase out C and F primarily because of their first dollar coverage.  Federal studies have shown enrollees under these two plans utilize more healthcare dollars with this first dollar coverage than other Medicare enrollees without coverage for deductibles and coinsurance left off by Medicare.  

By only allowing existing patients to continue to enroll under these two plans, over time enrollment should continue to decrease. Below is a chart of all the Medicare plans and coverage options under original Medicare.