Medicare Supplemental Plan F: What Is It and Why Should Someone Get It?

Medicare is a federally funded health insurance program. It provides senior citizens and chronically ill or disabled individuals peace of mind in knowing that many of their health care needs are met. Although it remains a valuable program for millions in the United States, there are holes in coverage that can create a financial overload. These gaps in services can create a tremendous burden in the form of massive healthcare bills. Consequently, Medicare supplemental insurance plans, also known as Medigap, are designed to fill those gaps in coverage. The Medicare supplemental plan known as Plan F is one such option that ensures that Original Medicare beneficiaries are provided with a vast array of vital services in a more comprehensive healthcare plan.

What Is Plan F?

Medicare supplemental plans are policies sold by private insurance providers that cover the supplemental health care services that are not paid for by Medicare Part A and Part B (sometimes called Original Medicare). Although not affiliated with the United States government, these plans are federally standardized in 47 states. Plan F provides some of the most comprehensive coverage of any Medigap plan, which is why it is a popular option among many Medicare beneficiaries.

What Does Plan F Cover?

Hospital and medical costs continue to rise. The most obvious benefit of Plan F is that it leaves participants with minimal out-of-pocket expenses. Excessive medical bills can lay a huge burden on seniors who should be focusing on their wellness and self-care. This plan eases that weight by helping to provide coverage for the following benefits:

  • Medicare Part A and B deductible costs
  • Coinsurance or copayment for Part B
  • Part B excess charges
  • Coinsurance for skilled nursing facility care
  • Copayment or coinsurance for hospice care
  • Blood (first three pints)
  • Plan A hospital costs and coinsurance for an additional
  • 365 days once Original Medicare benefits are exhausted depleted
  • Emergency foreign travel for medical purposes for up to 80% of authorized costs

Plan F can cover 100 percent of the copays, coinsurance, and deductibles that would otherwise be paid out of pocket when enrolled in Medicare Part A and Part B. This means that many consider Plan F to be “first-dollar rate coverage,” because the plan covers Part B excess charges. In other words, a percentage of a policyholder’s costs are paid by Medicare, and eligible participants can have Plan F cover the rest of it. Consequently, purchasers of Plan F policies who meet certain requirements will have little to no out-of-pocket costs for doctor’s visits and hospital stays.

What Does Plan F Cost?

According to the American Association for Medicare Supplement Insurance, 66 percent of Medigap participants choose Plan F despite it being the most expensive policy. Even with its higher premiums, Plan F can potentially save purchasers nearly one million dollars in Medicare fees, coinsurance, and deductibles. Because Medigap policies are offered by private insurance providers, premiums can differ based on a variety of factors, including age, location, health history, and gender as well as the premium pricing method that carriers use to determine costs. The formula used for premium pricing is typically based on the following three categories:

  • No-aged rate: All policyholders have the same premium.
  • Entry-age rate: Premiums are based on the policyholder’s age upon the purchase of the plan.
  • Age rated: Premiums increase as policyholders age.

Premiums can also vary if the provider offers lower rates for non-smokers, paying yearly fees or for purchasing multiple policies.

When Should Someone Enroll in Medicare Supplement Plan F?

The best time to buy a Medigap policy is within the month of turning 65 years old. This is considered the open enrollment period and it lasts six months. During this time, insurance carriers are not permitted to penalize purchasers for pre-existing conditions. After this period, the option to buy any Medicare supplemental policy may be more restrictive due to underwriting requirements.

Who Qualifies for Medicare Supplemental Plan F?

Because Medicare supplemental insurance plans were created to work in conjunction with Original Medicare, Medigap policyholders must be enrolled in both Medicare Part A and Part B and live in the plan’s service area. In addition, purchasers must not be enrolled in a Medicare Advantage plan. Medigap plans can be purchased by United States citizens or permanent five-year legal residents who meet any of the following conditions:

  • Aged 65 or older
  • Diagnosed with the end-stage renal disease
  • Diagnosed with Lou Gehrig’s disease
  • Receiving disability payments from the Social Security Administration or the Railroad Retirement Board

Medicare Supplemental Plan F is a highly favored comprehensive policy that serves as a safeguard against the cost of excessive health care bills. It helps shield policyholders from many out-of-pocket medical expenses and can provide comfort to policyholders when they know any unforeseen emergency or general health care expense will be unlikely to become a financial burden.

This article is neither reviewed nor endorsed by Medicare.

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