Medicare Supplement plans have been basically the same since 1992, when they were initially standardized. However, as of June 1, 2010, two new plans, M and N, are being made, among other changes in Medicare supplements. This article is intended to explain how the two newest plans, Medigap M and Medigap Plan N, work and the coverage they will provide.
Medicare Supplements, Plan M and N, are Medigap's newest standardized plans offered by private insurers in South Carolina and across the country. These two new plans provide a lower premium alternative to existing Medicare supplements, and many believe that these new plans will gain popularity in the Medicare Supplement market, especially with regard to significant changes to Medicare Advantage.
Medigap Plan M
Plan M, one of two new standardized plans, uses cost sharing as a method of reducing monthly premiums. This means that in exchange for slightly lower monthly insurance premiums, the Medicare Part A franchise ($ 1,068 in 2009) will be shared with the insurance company 50/50 on M. The insurance company pays half, and you pay the second half. Plan M does not apply to part of the Medicare Part B franchise; however, after you meet a Part B franchise, there will be no related services from the doctor. Most analysts predict that this plan will be about 15% lower than current F premiums (the most general plan).
Medigap N Plan
Plan N, one of two new standardized plans, also uses cost sharing as a method of reducing monthly premiums. However, instead of using a franchise sharing method such as M, it uses co-payments to lower the cost of the premium. The co-payment system is set at $ 20 for visits to the doctor and $ 50 for visits to the emergency room. It is currently planned that this co-payment system will come into effect after the Medicare Part B franchise is lifted. This plan should provide a 30% lower premium than the Medigap Plan F premium.
These plans, M and N, may be of particular interest to those who withdraw from Medicare Advantage, either by necessity (cancellation of their plan) or by choice, as it is expected that Medicare Advantage premiums will increase with new changes and premiums two plans will decline (starting with the initial Medicare Supplement promotions). Most expect that there will be a slight difference, if any, in the M and N premiums compared to the new Medicare Advantage premiums.
When these plans are released in June 2010, those in Medicare Advantage programs, as well as existing Medicare Supplement plans, should carefully consider the merits of the two new plans compared to their current coverage.
