The Medicare supplement market can feel a little overwhelming with all the different letters and levels of plans. However, if you know what everything stands for and how it works, it can be easier to navigate which Medicare supplement plan you need.
Medicare Plans Are Standard
One of the first things you need to realize is that Medicare supplement plans are standardized. What that means is Medicare Supplement Plan C with Company 1 and Medicare Supplement Plan C with Company 4 offer the exact same health benefits for you. T
he only difference between Medicare Supplement Plan C with Company 1 and Company 4 is the company that is selling the plan; everything about the plan itself is the same. Knowing this can simplify the amount of choices you are making. The first thing you need to determine is which Medicare Supplement plan letter you want to purchase.
Medicare Supplement Plan Letters Go in Order Of Increasing Coverage
When looking at the plans, they basically go in order of increasing levels of coverage and care. Plan A is the most basic supplement plan that you can purchase. It will cover your copayments and coinsurance, but that is about it. Plan F is the comprehensive Medicare Supplement plan, covering additional elements such as copays, excess charges not covered by Medicare and providing foreign travel coverage. Plans K & L are comprehensive like F, but come with an out-of-pocket limit you have to reach each year before they will start paying for things.
Three Ways Payments Are Calculated
There are three different ways that your fees for Medicare supplement plans are calculated, which creates the final difference between Medicare plans. The three ways of calculating premiums is attained-age rated, issue-age rated and community-rated. These three ways of calculating premiums are what set the same plan letters apart from different companies.
Attained-age policies premiums change every year to reflect your age, so you may see price increases in your premium every year. Issue-age plans are better than attained-age policy because your premiums rate is based on the age you enrolled in a Medicare Supplement plan with the company.
The best payment option is usually community-rated plans, where everyone in your community or area pay the same amount for the plan, regardless of age. These plans generally offer the best rates long term.
When it comes to choosing a Medicare Supplement Plan, figure out which letter plan you want, then figure out what way of calculating a premium you want to go with, and then find a company that offers you the letter plan and the payment option you want. For more information, contact companies like Senior Advisors.