Thanks to recent Medicare reform bills signed into law, there are going to be several significant changes to Medicare in the coming years. If you are currently enrolled in Medicare, or you’re going to be enrolled in Medicare soon, these changes could impact your experience.
While it can be difficult to keep up with all the thousands of different reforms that are constantly being signed into law (or just created by executive fiat), this is one that we should all take note of.
Some Medigap Plans Going Away
Medigap insurance policies are an excellent resource for enrollees to supplement their original Medicare policies. These supplemental plans are sold by private insurance companies, and help pay for coverage gaps left by Medicare Parts A & B, but in 2020, some of the most popular plans aren’t going to be sold.
To help pay for the “doc fix” legislation that was recently created, they are changing the way that Medigap plans interact with Medicare. The plan to eliminate the ability of Medigap plans to cover the costs of Part B deductibles, which is a notable advantage to Medigap plans C and F, two of the most popular plans. Currently, these supplemental policies can cover the Part B deductibles that are used for doctor’s visits and outpatient care.
Some people believe that making patients pay for the Part B deductible will force them to think about going to the doctor before they cost Medicare more money. If Medigap policyholders have to pay for their deductible, the thought is they won’t go to the doctor for “pointless” reasons and waste Medicare money. But many experts think that this change may just keep seniors from getting the health care they need.
For anyone that purchases a Medigap Plan F or C BEFORE 2020, they will be allowed to keep their current plan, but they won’t be sold after 2020. Because these are two of the most popular plans on the market, we are going to see a massive shift to different Medigap plans, or even Medicare Advantage plans that will still be able to cover Part B premiums.
The prevailing though is that most people who go on Medicare will decide to take a Medicare supplement plan G policy. These policies cover all expenenses not covered by Medicare Parts A and B, except for the Medicare Part B premium. So once a person pays for that premium out of pocket all other health insurance costs will be taken care of.
Part B Premiums on the Rise
Medicare Part B premiums are set to increase in 2018. Currently, most enrollees pay $121.80, but those with higher levels of income pay more.
To recover some of the costs of the “doc fix” bill, they plan to raise monthly premiums and continue to raise them more frequently than before. For any high-income earners (anyone that earns between $133,500 and $214,000) they will pay even more.
With traditional Medicare Parts A and B, the Part B premiums are a significant portion of what enrollees pay for their healthcare coverage. With these premiums rising more frequently, it’s going to be an even more strenuous strain on many elderly American’s bank account.
No More Donut Hole
Not all of the changes coming to Medicare are bad. In fact, one of the changes in 2020 could save enrollees thousands of dollars in prescription drug costs. In the next few years, the donut hole is going to slowly be closing, until 2020 when it will be closed completely. Thanks to Obamacare, the infamous donut hole, that is a part of Medicare Part D, and can break many retirees’ bank account, is going to vanish. This is one of the few positive outcomes from Obamacare, but it could have a significant impact.
For anyone that doesn’t know, the donut hole is the point in which Medicare Part D plans don’t pay for enrollees’ drug costs until they reach a certain limit. With the donut hole gone, Part D participants won’t be forced to pay completely out-of-pocket for any of the medications they need.
Medicare in 2020
If it seems like Medicare is constantly changing, that is because it is. It can be difficult to keep up with the different aspects of Medicare and the surrounding programs, especially when they don’t stay the same for more than four years. But as a Medicare enrollee or soon-to-be enrollee, you should always be aware of any new laws or regulations that are going to impact your healthcare coverage.