What You Need to Know
- The popularity of Plan N policies, which expose insureds to higher doctor bills, may have tripled.
- The apparent popularity of Plan N policies could have something to do with AAMSI's survey sample.
- Hard Medigap enrollment figures for 2020 will come out in a few months.
Americans now aging into Medicare eligibility may be more open to accepting what amounts to a two-tier doctor fee system to hold down Medicare supplement (Medigap) insurance premiums.
The American Association for Medicare Supplement Insurance (AAMSI) has published data raising that possibility in a summary of results from a new consumer survey.
All of the survey participants became eligible for Medicare in 2020 by turning 65, and all combined Medigap policies with traditional Medicare coverage.
About 33% of the new Medigap enrollees who participated in its survey said they had signed up for Medigap Plan N policies, according to survey data gathered by MedicareFAQ.com for AAMSI.
America’s Health Insurance Plans reported in 2020, based on data health insurers put in their annual financial statements for 2018, that Medigap Plan N policies accounted for only about 10% of overall Medigap enrollment in 2018.
About 59% of the AAMSI survey participants said they signed up for Medigap Part G coverage in 2020.
In 2018, the richest available policies, Plan F and Plan G, accounted for 60% of total Medigap enrollment, according to AHIP.
AAMSI did not give any details about the MedicareFAQ.com survey sample. It’s possible that the apparent popularity of Part N policies is due to the nature of the sample. But, if Plan N policies are getting to be more popular, that could be a sign that people turning 65 now are more willing to accept access to fewer doctors, or pay more to see higher-cost doctors, to hold down monthly premiums.
Like other Medigap sold to consumers who are “aging into” Medicare eligibility, Medigap Plan N cannot cover the Medicare physician and outpatient services deductible.
Medigap Plan N policies cover almost everything else a Medigap is allowed to cover, with the exception of doctors’ “excess charges” and $20 co-payments for most physician office visits.
Medicare Part B Excess Charges
Some doctors “accept Medicare assignment.” Those doctors count the Medicare Part B program’s reimbursement rates as payment in full. Other doctors will treat Medicare patients but want to charge more. Those doctors’ excess charges can be up to 15% more than the standard Medicare rate.
Traditional Medicare program managers do not have “provider network contracts” with the doctors and do not use the term “network.”