Why Pick a Plan G
Imagine if you went to purchase your next car and you were informed by the dealer that there was a new Department of Motor Vehicle rule that whatever car you bought next would need to remain your vehicle for the rest of your life. If this was the new rule we would all think very carefully about which car we were going to buy and we would be hesitant to cut any corners.
As crazy as the notion of being stuck for life with something is, this is what very well could happen to you in choosing a Medicare supplement. Because of losing Guaranteed Issue six months after you start Part B, you may well be locked into the plan you select for as long as you have healthcare which is hopefully 50 more years. Most people would say that the healthcare plan that’s going to remain their healthcare plan for the duration is even more important in the scheme of things than the car which they drive. Therefore choosing wisely is critical.
There are two main reasons I recommend you choose the most popular choice, Plan G:
1. Cost Over Time
Yes, a Plan G will cost you a little more each month in premiums. That said, a Plan G also gives you more coverage. Clients will often consider a High Deductible Plan G to save money. Doing so can cut your premiums in half. But the question is: How long will you save money? If you have zero medical needs this year you could save around $600 in premium costs by going with a High Deductible Plan G.
But let’s look at the other side of it. A regular plan G has a $203 deductible, while a High Deductible Plan G has a $2,340 deductible. It doesn’t take much at all medically before saving $600 in premiums gets traded for paying a $2,340 deductible instead. An MRI, for instance, averages $2,000. And once you have an ongoing medical condition, or simply reach a stage of life where things happen, you can expect to pay the $2,340 deductible every year after that. Or whatever the government raises the amount to. Some people end up saving $600 for a year or less only to pay an extra $2,000 forever.
That’s why when people think things through of the impact over time they almost always pick regular Plan G. The fact is that a Plan G offers the most cost certainty over the whole course of your life.
2. Excess Charges
Plan G is the only one that pays the extra 15% excess charges that doctors and clinics who haven’t accepted the normal Medicare amounts are allowed to charge. As time goes on, and medical costs go up, more and more medical providers are requiring the 15% excess amount that only Plan G pays.
Your savings with another lettered plan such as Plan N may be $15 or $20 a month, but usually not enough to justify losing the ability to go to clinics and doctors who require the excess charges.