When it comes to choosing Medicare Supplement plan options, new-to-Medicare beneficiaries are opting for lower cost plans according to the American Association for Medicare Supplement Insurance (AAMSI).
“Medigap remains a highly popular choice but there appears to be greater interest in lower cost options,” says Jesse Slome, AAMSI’s director. During the first six months of 2022, 38% opted for Medigap Plan N. Just over half (51%) selected Plan G coverage. Nearly 6% enrolled in a High Deductible Plan G (HDG) plan.
The Association’s report examining 2021 new enrollees reported that 36.5% went with Plan N, 55% selected Plan G, and 6.7% High Deductible Plan G. AAMSI worked with MedicareFAQ to obtain data.
“I expect the trend to lower-cost options will continue for two reasons,” Slome says. “First, consumers are being bombarded with Medicare-focused television ads touting free coverage and benefits making it harder to sell coverage that costs. Second, saving money is always a winner with many seniors who live on fixed or limited budgets.”
A Chicago-area female turning 65 can expect to pay $117 monthly for Plan G from a popular Medigap insurer, Slome found. The same insurer offers Plan N for $86-per-month, amounting to a $372 annual savings. A Medigap HDG plan can be obtained for as little as $32 to $45-per-month. In Chicago, men can expect to pay more for similar coverage. Around $132 per month for Plan G, $97 for Plan N and between $37 and $48 for HDG.
Plan G covers 100% of all Medicare-covered expenses once the Medicare Part B deductible has been met for the year. First introduced in 2010 as a way to offer lower cost options, Plan N has a few additional out-of-pocket expenses that policyholders will have to pay. These can include a nominal co-pay for doctor or emergency room visits. Plan N can also have one facing Excess Charges.
High Deductible Plan G is a relatively new option for Medicare beneficiaries. It is only available to those who turned 65 or went on Medicare on or after January 1, 2020. The plan comes with a high deductible ($2,490 for 2022) but is highly appealing for those looking to save money and who may not anticipate many medical needs during the year.
The American Association for Medicare Supplement Insurance is an advocacy and informational organization that strives to create heightened awareness for the many Medicare insurance options. AAMSI supports insurance professionals who market Medicare Supplement insurance.
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Who would have thunk it? I've been telling MAPD agents this for over a year. HDG gives the savings of MAPD with the claims processing and freedom of OM.
You don't get paid as much, but it's still a great plan.
I have to come out of retirement for this one. How in the world can anyone think they are better off paying premiums for a HDG and then paying $2490 deductible for a total of around $3000/year vs. paying $0 for a MAPD and adding dental, vision, gym, hearing aids, OTC, meals, transportation, etc worth at least a couple thousand and have a max oop of $3500?
Spare me the rhetoric of having Drs not in network, having trouble getting tests approved, etc. That hasn't been an issue in my area for several years. But what if I get cancer? Then you max out the $3500 and you are still ahead of the game. You could literally do that every year and still come out ahead.
I suppose the clients that are being talked into this HDG are the ones that have lived paycheck to paycheck and made dumb financial decisions all their life so they are told this is the safest way to go. Anyone turning 65 and coming off a group plan or Obamacare surely can see which way they would be better off if both options were explained to them.
At some point common sense has to take over. OK, back to retirement.
Yeah, still not going to actively sell it.
A long time ago a seasoned agent gave me a "mantra."
Help people. Truly seek to do that with your work. But you must have an objective to help at a profit.
A huge book of HDGs … I'd rather go sell siding.
Independent studies from OIG prove differently. I'm quite sure clients aren't calling you when doctors get denied claims.. why? Because only 1% of denials are appealed.
I'm assuming you're selling a HMO, which further restricts access to providers. But please, pretend it doesn't.
All those extras you talk about are not Medicare approved services, and the company can remove them at any time. MooP? Can change annually. Ask UHC and Silver Sneakers, or when companies change from a dental plan to a lump sum which is usually bleh.
As I'm certified to offer both, it's always what's best for the client. Sometimes MAPD is great. Sometimes HDG is the better route. However, your argument that it NEVER is literally proves that you're not offering both options.
When your present the two OBJECTIVELY they almost always see that HDG is the better plan.
What's silly to me is your argument is that "if both options were presented." It's moronic. We have a financial incentive to offer MAPD over HDG. 700+ vs 100+ pdp.
HDG is superior MEDICAL coverage to every MAPD on the market, period. All that other noise is TBD annually. Either people want stability and are willing to pay for it or don't want to pay for it and get MAPD.
PUSHING MAPD, like you do, shows how you're not "presenting both options." It's fine if you're not, just be honest about it.
I agree. I don't sell it on a consistent basis. I think less than 10% of my book is HDG. It's usually when someone is crying poor, but has a really chronic condition that likely needs better medical.
I end up writing maybe half a dozen HDG's per year . . . last year I wrote 9.
G is still my go to. When someone balks at the premium (rarely), sometimes they will ask about N . . . T65 N vs G premium (looking at established carrier) saves about $15 or less.
If they still want a lower premium I show HDG. Premium catches their eye (about $60/mo savings) but the $2500 deductible is a concern. "So, I gather the MA plans with $6700 OOP is not appealing?".
They usually end up with the G plan and everyone is happy.
I have never sold an HMO, I show Plan G as an option along with MAPD and Medica Cost Plan but I can’t imagine anyone wanting that high deductible even if the premium is a little less. How can you say HDG is superior medical coverage when they are paying all that out of their pocket vs having very little copays on Drs and 300.00 for outpatient surgery etc on an MAPD? Not looking at getting Into an argument again but this one really threw me for a loop that anyone with even a little common sense would choose the HDG.
I agree the G plan is a great option for some people. I just can’t see why anyone would go on a HDG. I would put them on an N plan if price was a concern and they did not want a MAPD. I would worry about Med Sup clients getting picked off if you didn’t present all their options including MAPD. In most area now many are leaning towards MA plans and each year the % gets higher and higher towards MA. Looking at 2023 plans they are even more attractive then they were this year.
Premium isn't "a little less." It's about a third to a quarter of Plan G.
I can't say for your area, but there is no PPO in my area with a 3500$ MooP. Those are HMOs, if anything and are usually 4600+.
Choice matters to people. You literally made my point. "I offer Plan G or MAPD."
I'm not sure you understand how HDG works.
Medicare STILL pays its portion after the Part B deductible. The 20% is actuarially the same as most PPO costs for doctors visits and the hospital stays (without HI) are cheaper, usually… obvs depends on the plan.
Furthermore, while you may not need a referral to see specialists, you still need prior authorizations that can and are denied for other services.
Managed care is managed care.
I'm sorry that you don't understand how Medicare works vs how private insurance works.
To each their own. If I ever run into a HDG there is no doubt they will be switching to a MAPD after I show it to them. Obviously plans are a lot better in my area then wherever you are. Read a few other posts and it has really gotten boring since I quit posting, just moved onto everyone wanting to move out of the U.S. I guess when you just have a few people who only believe in Med Sups there isn’t much to discuss on the forums. Anyone, I’m back out. Good luck to everyone this AEP.
Travis mentioned this as well but when you factor in the Medicare re-pricing and 80%, it's really not bad at all. Sometimes lower than the MAPD copay.
I'm comfortable enough with the other options though to simply not advertise it. I don't find it to be "categorically better" because I put a lot of weight on Rx cost. Rx coverage is almost always head and shoulders abover Stand Alone Part D. I've never been successfully refuted on this and I've said it for years. And people on Medicare spend a lot on Rx's…
I think there are probably 25+ "levers" or "weights" within the category of "Healthcare in retirement."
Access to care matters. But some weigh it more than others.
Cost matters. Dental matters. This month I helped a T65 who lost a tooth get a MAPD plan with $2,000 towards dental – implants included, no Pre-ex exclusions. Had I just talked about access to care… she would have missed out of help needed today.
And I'm not concerned, at all, that I've somehow messed up her entire future on Medicare because she didn't pick a med supp.
If one day she does have access to care issues, or high out of pocket, I won't lose sleep. She's paid $0 monthly… had better insurance than my family has, utilized many benefits with great success, and is still protected with a very reasonable max OOP. All good!
Why is it no one ever came up with enroll in Medicare Advantage and save the difference?
Sigh. Its not about the plan you buy at age 65. Its about the plan you want at age 90. Same reason I rarely sell Plan N. Or MAPD.
"My grandmother at age 90 had the money to pay the $20 copays. What she didn't have the physical or cognitive ability to do so"
It all matters. Its our job to present the options. Not to make the decision.
But I love the "I'm not going to lose sleep over it" because I feel the same way. You can have the MAPD or Plan N or Plan G. But you aren't going to yell at me later. Ever.
Possibly because it works just as well as buy term and invest the difference . . . which usually translates into buy term and SPEND the difference
Yup . . .
I think there's always an argument for MAPD. Again, less than 10% of my bookis hdg. I do think you have to explain access to care and dental is the first thing that gets slashed under cost savings.
All of that being said, if the client understands options and chooses MAPD.. it's not my job to convince them otherwise.
And I have no issue with this other than med supp affordability at age 90 if they weren't able to change carriers due to UW issues. It's high, plus a lot of cheddar on premiums for the 25 year ramp up period to get to 90…
Even the bigs (UHC, BCBS) go high after someone is on the books 10+ years. I have a few from circa 2012 who are paying more than double what it started in 2012.
Not sure what they'll be paying in 2037 but I doubt it'll be under $450/mo. My guestimate is $600+ for G for those 2102 T65 @ 90. Some will afford it – some will have to drop it.
If the MAPD trend keeps going strong – do we anticipate higher rate hikes with med supps from 2022-2037 than we saw from 2012-2022? If I were a betting man (I'm not), I'd say yes.
Meanwhile my 2012 T65s that took Humana Gold Plus HMO are still paying (checks notes) $0.
In premium. JS. There's more to healthcare expenses than just insurance premium. YMMV
How much do you suppose those 90 year old's will be paying OOP for healthcare?
Bill Clinton (not a fan, just using his campaign pitch) used "It's the economy, stupid" as a reminder to him, and prospective voters, to drive home the fact that all the other things talked about to sway voters really don't matter when you don't have a job, and can't pay your bills.
Healthcare is the same.
Paying a $0 premium is meaningless when your medical bills are running in the hundreds or thousands per month . . . and that is only for in-network approved claims . . .
So . . . it's not JUST the premium, stupid . . . it's your total OOP that really matters (plus access to care).
True.
I'm thinking of 1 lady right now – T65 in 2012.
Looked up her drug list in S&S.
For her $0 MAPD, her rx's for 2022 will be $380. Lowest Part D estimate (including premium) is $756. (double). And it's like this year after year….
She doesn't pay for dental (2x yearly consistently for years). There's value there – at least $400/yr.
She utilizes the OTC benefits. Saves over having to buy preventative stuff at CVS. There's value in that…
At 75, she's not paying $200+ for Plan G (had she picked G at 65 @ $100/mo, we likely wouldn't have been able to change – insulin-dependent diabetic and $200+ would likely be her cost). There's value in re-capturing that monthly cost.
All these things (in my mind) have a cumulative effect over a 25 year period on someone earning $1,800/mo. If MAPD saves them even $100/mo (which is conservative), that's $30,000 in savings by age 90.
That's a lot of years hitting the dreaded out-of-pocket maximum (which is only $4,500).
She's never come close and she's been an insulin-dependent diabetic for a while now.
—
In my mind – with those 25+ levers, I really do think most people will come out ahead w/ MAPD over 25 years. Could be wrong, but I don't think so.
I have 61 High Deductible Plan F's. I use HD F as a loss leader to get to the big $$$$$! Their Part D!!!
Grandma quote #2 "That premium is ridiculous. But I can't travel anymore, eat out or anything else fun. Might as well make my health care easy since that's all I do, anyway."
She died at age 90, after 10 years of at home dialysis. Mental facilities were 100% until the last 3 months.
Financial Planners have used $500/month per person as the standard for years. And it still works over the 35 years, averaged out
Those 90 yr olds on MAPD will be paying:
(a) $450 per month less, per person, in premium ($5,400 in savings)
(b) 50% of the cost on their Rx's ($850/yr+ in savings)
So those 90 yr olds on MAPD are starting $6k ahead of their Med Supp + Part D counterparts.
+ copays according to the summary of benefits. The vast majority do not hit the Max OOP. Let's call it $5000 on average if they have a lot of claims.
I'm still not seeing the downside.
And I'm not trying to be obtuse.
I
My thing is also client comfort. For example, I had a guy with DM and some heart issues that wanted to stay away from Part C. We sold him Part G + PDP, but he's on a crazy expensive injectable for DM.
After I reran his drugs with MAPD, I thought there was some significant savings and called (he's still in IEP) and broke it down. His answer, I have 4m of the injectable and I think I want to talk to my doctor because there's a generic coming out soon, and also changing drugs around. Can we run this during AEP?
Yep.
He doesn't want Part C. There are shortcomings, obviously. Sometimes they just feel more comfortable with MEDIGAP and they're willing to pay for it.
I had the same thing happen with Humana vs Wellcare. Wife would save 200 dollars a month using Humana PDP. Husband heard "bad things" about Humana and despite explaining that Medicare Part D is different than U65 health insurance, he wanted Wellcare. I ended up sending him to Wellcare and took the loss of commission (because I don't want that under my name), but it's their call.
Yes, no argument here. My T65s still go 60% med supp. Risk tolerance and feeling good about the insurance matters – it's another lever.
You will never get it across to them so you are wasting your time. They are so set in their ways they still think they are better off paying more for a Med Sup than what the OOP max is on an MAPD. Not to mention all the extra stuff you mentioned. They are just like the nurses that tell everyone MA plans are the devil and avoid them. I have over 600 people that say otherwise. Maybe I’m just lucky in my area but haven’t had any problem with networks or preapproval for years.
In 10 years when it’s 65% MA and 35% Med Sup these same people will be on here saying Med Sups are the only way even though Part B deductible will probably be 400.00 and premiums who knows how high. Not to mention Part D ded up to 650.00 and still no deductible on MAPD.
feels like you probably should have led with this
I think that I'm pretty vocal that I'm certified to offer MAPD and my philosophy is out there too..
I shouldn't have to say on every post or convo that I can sell MAPD…
Ymmv
Too bad those 90 yr old folks with Medigap plans have no place to go. If only there was a low/no premium option for them, that would allow them to keep their doctors, and underwriting isn't required . . .
Lost dollar states on every post that he is not an agent . . . perhaps if you started all of your posts with a PSA stating you are licensed and certified to offer MAPD you wouldn't catch so much grief from the short attention span crowd.
Maybe I can put it in my sig for the neurodivergent.
:nah:
You won't be putting me on a Plan N.
@Midlevel dodged a bullet there!!!!