Medigap Plans, Medicare Advantage, and Part D

*This is Part 3 in a 3-part series designed for people going on Medicare or turning 65. Please
medigapcontact us if you have any questions about this information or fill out a quotes request if you want to get Medigap quotes.*

Medigap plans, Medicare Advantage and Part D are additional coverages that you should be considering if you are going on Medicare. Each of these has their own unique designs and advantages/disadvantages. This article is intended to introduce you to each and give you more information to consider about what is right for you.

First of all, let’s take a look at Medigap plans. Medigap plans are sold through private insurance companies, but they are Federally-standardized. What this means is that each company has to offer one of the standardized plan designs. The chart that shows these standardized plans can be seen here. As you can see, Plan F is the most comprehensive plan – it pays what Medicare Parts A & B do not cover at the doctor and hospital, so you should not have any out of pocket expenses. It is, of course, the most expensive. Other common lower-premium, less-coverage options include Plan G and Plan N. Plan G, in particular, is often a better value than Plan F (Read more about Why Plan G is often better than Plan F).

In addition to the coverage being standardized with Medigap plans, the claim payments and doctor acceptance are also standardized. That is, if a doctor/hospital takes Medicare, he or she will take the standardized Medigap plan that you have, regardless of which company sells you the plan. Additionally, claim payments are processed through the Medicare “crossover” system, so the plans, essentially, “follow” Medicare as a supplement and claims are all handled electronically. For these reasons, it is important to compare the Medigap plans on the basis primarily of cost and company rating. These are the two variables that can differ from one company to the next. You can get a Medigap quotes comparison for you area sent to you by email.

Medicare Advantage is entirely different from Medigap. Many people mistakenly lump them in together or call Medicare Advantage plans “Medicare Supplements”. This is not accurate, as Medicare Advantage plans do not supplement Medicare, but rather take its place in paying claims. These plans have networks, and most are either PPOs or HMOs. Often, premiums are lower than the premiums of Medigap plans, but the coverage is typically also lower. They, in most cases, work more like traditional employer/group type plans. There are some distinct drawbacks to this type of plan, in our experience, and we do not recommend them in most instances. Some of the particular downsides are the network restrictions (which are often based on your county or state) and future plan change issues. If you take a Medicare Advantage plan when first eligible for Medicare, you do have to qualify medically to switch to a Medigap plan at a later time.

Medicare Part D is a part of Medicare, but it is sold through private insurance companies. Part D covers prescription drugs. There are typically 20-40 plans in each county, so it is crucial to compare the plans based on how well they cover your current medications. Co-pays and plan premiums can vary greatly. You can do this on Medicare’s website at: Compare Part D plans.

It is important to sign up for Part D when first eligible unless you have creditable coverage. Medicare imposes a 1% per month penalty if you do not sign up for a Part D plan when you are first eligible (you are exempt from this penalty if you have creditable coverage through an employer-type plan). Premiums for Part D typically range from $15/month to $100/month so it is vital to choose a plan that covers your medications and is the appropriate coverage level for your current medication usage. You can change Part D plans during the annual enrollment period which runs October 15-December 7 each year.

This article explains some of the other coverages that go with Medicare, such as Medigap, Medicare Advantage and Part D. If you still have questions or want to discuss further, please feel free to contact us. is one of the nation’s leading independent brokers of Medigap plans. We work with 30+ companies in 40+ states and work exclusively with this type of insurance. As a result, we can provide unbiased, experienced expertise to those going on Medicare and turning 65. Feel free to contact us or request Medigap quotes online.

Are Medicare Part B Premiums Going Up to $247 in 2014?

Are Medicare Part B Premiums Going Up to $247 in 2014? This is the question I receive on a weekly basis from my clients. The question stems from an email that has been, and continue to, go around saying, basically that – that premiums are going up to $247 for Part B in 2014. The email has been going around in some form or fashion since 2009. Here’s the text of the email that I have seen (there may be other variations):


For those of you who are on Medicare, read the article below. It’s a
short but important article that you probably haven’t heard about in
the mainstream news:

The per person Medicare insurance premium will increase from the
present monthly fee of

$  96.40, rising to:

$104.20 in 2012;

$120.20 in 2013;  And

$247.00 in 2014.

These are provisions incorporated in the Obamacare legislation,
purposely delayed so as not to ‘confuse’ the 2012 re-election

Send this to all seniors that you know, so they will know who’s
throwing them under the bus.

So, is this true? Enough people believe it and are sending it around, so it must be true – right?

Not so fast! First of all, the 2011 and 2012 numbers are incorrect. The 2011 official Part B premium was $115.40, and the 2012 Part B premium is $99.90 (unless you fall into the high-income category or receive extra help paying your Part B premium).

Secondly, and most importantly, Obamacare or PPACA, as it is formally called, did not make any changes to the way that Medicare Part B premiums are figured. These processes for determining the Part B premiums are the same as they have been. One of the important components of these processes is the “hold harmless” provision – this says that Medicare premiums cannot go up for existing beneficiaries if Social Security payments do not go up. This “hold harmless” provision kept some beneficiaries, in 2011, paying the 2009 rates ($96.40) because there was no cost of living increase to Social Security in 2010 or 2011.

You should understand how Medicare premiums are calculated. Medicare beneficiaries are required to contribute to their Part B premiums. Right now, these contributions are required to be at 25% of total costs. So every year, Medicare figures out what the total costs will be and “backs into” that 25% figure that beneficiaries are responsible for.

For the Medicare Part B premium to go up that much, the cost of living increase in Social Security would have to be about 250%. Now, if that happens, there’s going to be a lot of happy Medicare beneficiaries! (That’s not going to happen!)

With all that understood, you can easily see that there is no way that this “scare tactic” email is correct. Sure, there are some things that insurance agents, insurance companies and consumers alike should be concerned with regarding the PPACA legislation, but this is simply not one of them. So if you receive this email, instead of “sending it on to all seniors you know”, why don’t you take a stand for truth and hit the delete button instead.

For more information like this, visit our Medigap website and blog on a regular basis. Or give us a call at 877.506.3378 with any specific questions regarding Medicare, Medicare Supplements or Part D.

Garrett Ball on Google+