The New Medigap Plans M and N
Plans M and Plan N were designed to provide seniors with lower cost Medigap options through cost-sharing measures such as co-pays and covering part of the deductible expenses. Plan N, for example has a $20 office co-pay and a $50 emergency room co-pay, while Plan M covers 50% of the Part A deductible.
Plan F is currently the most popular plan. These two new supplement plans cost 20-25% less then F, with similar medical expenses covered, albeit, with the co-pays. However, premiums are expected to be as much as 25% lower than Plan F - and some 70- 75% lower than Plans C and D, which are two other popular plans.
Plan M
Medigap Plan M is very similar to current Plan C. It will offer the same core benefits as Plan C with the additional hospice benefit required of all plans as of June 2010.
However, unlike Plan C, Plan M does not cover the Medicare Part B deductible at all, and only 50% of the Part A deductible. However, once both deductibles are met, you will no longer have to pay co-pays for hospitalizations (Part A) or doctors visits (Part B).
As you shop for an affordable Medigap plan, and are thinking about Plan M - consider this. Make sure any savings in an annual premium for selecting Plan M, over another Plan such as C or D which covers the full amount of the Part A deductible, amounts to at least 550.00. This is because as we said earlier, Plan M will cover HALF of you Part B deductible amount, which is currently $1100.00. Which means you will be responsible to pay $550.00. So if you are not saving $550.00 or more on your premiums, it is a wash.
Plan N
Plan N is similar in benefits to both Plan C and Plan F. However, Plan N does not offer lower premiums by paying for any part of your Part A or Part B deductibles. Instead it defrays cost by utilizing co-pays.
This co-pay structure, new to Medigap plans, is estimated to result in premiums that are about 30% lower than comparable plans.
Copayments for doctor appointments are $20.00 and for emergency room trips, $50.00. If the emergency visit leads to an admission to the hospital, the ER co-pay is waived.
In some states health insurers are offering Plan N as “guarantee issue" with applicants not subjected to medical underwriting, even beyond the “open enrollment" period.
Medicare Supplement Plan N has all of the core benefits of Plan M, as well as the newly required hospice benefit for all Medigap plans sold after June 2010.