Medicare Answers: High-Deductible Plan F

  • Originally published July 9, 2012 , last updated December 23, 2014
  • Medicare
Medicare Answers: High-Deductible Plan F

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This week’s question deals with high-deductible Plan F.

Sue writes:
“Last year I placed 250 Medicare Advantage Clients into a high-deductible Plan F. I have contemplated since then whether I did the correct thing for my clients. I think I did and would be interested what your opinion is. Thank you for taking the time to respond.”


Thank you for your question. As long as your clients are completely informed of the plan they selected, then you made a wise decision. Many agents stay away from the high-deductible Plan F for a variety of reasons. Commission is one of those reasons. You had to write three times as many lives to get the same commission you would have made if you sold all Plan F. Obviously you were not thinking of your bank account as much as what was best for your client.

Another reason is that the high-deductible Plan F is misunderstood. Many people think it combines the deductible with Medicare, which simply is not true. The deductible is only applied to the Medicare Supplement portion; Medicare pays the same regardless of which Medicare Supplement a person has. And lastly, maybe the biggest reasons agents stay away is selective memory. Many forget why they took the plan was for lower premium.

Now Sue, back to your question. Not knowing what the MA plan had as far as benefits or premium, I can only assume that the premium was $0 or very little and the benefits were typical compared to most MA plans in your area. That being said, you took them to a $2,000 deductible plan in 2012.

With an MA — If your client goes to a primary physician, the co-pay would be $10 and a specialist $40 for each visit. This amount does not apply to the out-of-pocket max.
With a HDF — The $140 Part B deductible will be applied before Medicare pays 80% of their approved amount until the deductible is paid and then the supplement begins to pick up the other 20% of Medicare approved amount for 2012.

With an MA — If your client has to be hospitalized, there is a $225 co-pay for the first 7 days. Since the average hospital stay is 3 days, that would be $675. This is amount would apply toward the out-of-pocket maximum of $3,750.
With a HDF — The Part A deductible of $1,156 would have to be paid for the first 60 days. Any of the other provider expenses and out-of-pocket costs on Part B would apply towards the $2,000 deductible. If it was satisfied the HDF would pay the full Part A deductible of Medicare.

A good decision, Sue? I think so when you compare the HDF to MA. Naturally many would probably say the Plan G or N would have been better. Please keep us updated on how the first year went, how many wanted to change plans, go to a different supplement or other opinions about the high-deductible F.

Thank You,