Why arent high deductible medigap plans more popular?

[LostDollar]

I pay $115/month for plan G
add the $240 ded or $20/month
and
$165 medicare part B premium monthly
so about $300 per month before we add the
PDP
seniors don't want to add yet another deductible-I've had ZERO clients ask for a high deductible plan in the 19 years I have sold medicare plans

Caveat, not an agent.

seniors don't want to add yet another deductible

If you intend that to mean ALL seniors, you have made a false statement.

 

[bill3173]

HDG isn't like a MSA where absolutely nothing is covered until the full deductible is paid.

MSA plans have an account associated with them that is funded right from the start and the money can be used to cover health related expenses. It is prorated the first year, based on when you start, but if you start in January, it's $3K. If you don't use it, it rolls over to the next year, just like an HSA.

If you have an HSA when you begin Medicare, and were in reasonably good health, you would conceivably never have any out of pocket expense. If I were Medicare age and an MSA was available in my area, I wouldn't hesitate to join one.

 

[LostDollar]

MSA plans have an account associated with them that is funded right from the start and the money can be used to cover health related expenses. It is prorated the first year, based on when you start, but if you start in January, it's $3K. If you don't use it, it rolls over to the next year, just like an HSA.

If you have an HSA when you begin Medicare, and were in reasonably good health, you would conceivably never have any out of pocket expense. If I were Medicare age and an MSA was available in my area, I wouldn't hesitate to join one.

Keep in mind that with an MSA you are liable for the full Medicare Allowed Part B charge, not just the 20% portion.

And annual allowed contributions to the MSA's and HSA's are controlled.

Even if you are allowed to use both MSA and HSA funds to pay for a single health event, something like a hip transplant could suck out almost 2 years of contributions to both plans, in a single gulp.

Just having an HSA may not be enough. The length of time one has been able to contribute to an HSA would also have a significant impact on the long term viability of the approach you suggest.

(I would like to see something like U65 HSA plans allowed for Over 65's using HD Medigap plans.)

(Also remember an MSA is a Medicare Advantage plan which would remove you from the fold of Original Medicare Coverage.)

 

[bill3173]

Keep in mind that with an MSA you are liable for the full Medicare Allowed Part B charge, not just the 20% portion.

And annual allowed contributions to the MSA's and HSA's are controlled.

Even if you are allowed to use both MSA and HSA funds to pay for a single health event, something like a hip transplant could suck out almost 2 years of contributions to both plans, in a single gulp.

Just having an HSA may not be enough. The length of time one has been able to contribute to an HSA would also have a significant impact on the long term viability of the approach you suggest.

(I would like to see something like U65 HSA plans allowed for Over 65's using HD Medigap plans.)

(Also remember an MSA is a Medicare Advantage plan which would remove you from the fold of Original Medicare Coverage.)

You may want to read the SOB for an MSA Plan. If you choose the lower deductible plan, your Max oop is limited to the deductible $5k - $2K that is deposited into your account. So, $3K max out of pocket is not going to kill two years of hsa savings. They are making this deposit annually. Additionally, MSA funds can be used for Rx. This imeo is absolutely better than paying for a HD G plan.

I didn't say it was for "everybody", but there are a lot of people that could really benefit from these plans, if they understood them. It's not a real winner for most agents to market them, because you have to have a "reasonably intelligent" audience, and of course, that's not most people.

 

[LostDollar]

You may want to read the SOB for an MSA Plan. If you choose the lower deductible plan, your Max oop is limited to the deductible $5k - $2K that is deposited into your account. So, $3K max out of pocket is not going to kill two years of hsa savings. They are making this deposit annually. Additionally, MSA funds can be used for Rx. This imeo is absolutely better than paying for a HD G plan.

I didn't say it was for "everybody", but there are a lot of people that could really benefit from these plans, if they understood them. It's not a real winner for most agents to market them, because you have to have a "reasonably intelligent" audience, and of course, that's not most people.

Ok, thanks for the comments. good points. I'll take a look sometime.

(I was thinking about a total CMS approved $12-$14K liability and neglecting to consider an OOP cap.)

For me, the biggest "unselling" point was that I had to go into Medicare Advantage plans.

(And I guess I am still upset about the agent that agreed to sell me an HDF plan and then immediately started the phone interview, which I thought was going to be a short application process, by pushing the Lariat MSA plan. I don't think he was going to tell me it was an MA plan until I prodded him into agreeing that it was.)

For this year (2024) it's probably a moot point. If I am remembering correctly, there was a discussion here earlier in the year that came down to there only being one MSA plan offered anywhere in the USA this year. The big player dropped out.

 

[goillini52]

Ok, thanks for the comments. good points. I'll take a look sometime.

(I was thinking about a total CMS approved $12-$14K liability and neglecting to consider an OOP cap.)

For me, the biggest "unselling" point was that I had to go into Medicare Advantage plans.

(And I guess I am still upset about the agent that agreed to sell me an HDF plan and then immediately started the phone interview, which I thought was going to be a short application process, by pushing the Lariat MSA plan. I don't think he was going to tell me it was an MA plan until I prodded him into agreeing that it was.)

For this year (2024) it's probably a moot point. If I am remembering correctly, there was a discussion here earlier in the year that came down to there only being one MSA plan offered anywhere in the USA this year. The big player dropped out.

Lasso was the only MSA I was aware of, and they went bye bye.

 

[LostDollar]

Lasso was the only MSA I was aware of, and they went bye bye.

Sometime between whatever year Lasso started and 2023, there were 2 to 4 other ones, state specific. At one point, I believe there was one state that actually had 2 other ones.

If I remember right, the language of other plans' documents varied from Lasso's statements that providers accepting Medicare were obligated to accept the MSA plan.

(@bill3173 -- I had forgotten about provider acceptance. Based on posts I saw here, the battles to get providers to accept MSA plans were one of the reasons a number of agents, even agents who generally believed in the MSA plan concept, decided not to offer, or to stop offering, them. There was just too much client support and general headache involved in dealing with providers that refused to accept MSA plans.)

 

[renee15]

Caveat, not an agent.

If you intend that to mean ALL seniors, you have made a false statement.

not following-
yes, I am an agent-19 years selling medicare plans
second-none of MY clients want to pay deductibles-good grief the feedback I get from the cost of their drugs is enough

 

[renee15]

MSA plans have an account associated with them that is funded right from the start and the money can be used to cover health related expenses. It is prorated the first year, based on when you start, but if you start in January, it's $3K. If you don't use it, it rolls over to the next year, just like an HSA.

If you have an HSA when you begin Medicare, and were in reasonably good health, you would conceivably never have any out of pocket expense. If I were Medicare age and an MSA was available in my area, I wouldn't hesitate to join one.

however, if your health did indeed change, you couldn't buy a Medicare Supplement
I too thought about a MSA plan several years ago since I had an HSA plan

 

[goillini52]

Sometime between whatever year Lasso started and 2023, there were 2 to 4 other ones, state specific. At one point, I believe there was one state that actually had 2 other ones.

If I remember right, the language of other plans' documents varied from Lasso's statements that providers accepting Medicare were obligated to accept the MSA plan.

(@bill3173 -- I had forgotten about provider acceptance. Based on posts I saw here, the battles to get providers to accept MSA plans were one of the reasons a number of agents, even agents who generally believed in the MSA plan concept, decided not to offer, or to stop offering, them. There was just too much client support and general headache involved in dealing with providers that refused to accept MSA plans.)

I picked up Lasso, but couldn't find one provider in my area that would accept it. Good plan.