Medicare Supplement Plan G – Looking Better and Better for 2012

Medicare Supplement Plan G is the less-talked-about cousin of Plan F. While ‘F’ gets all the glory and the “it covers everything that Medicare doesn’t” talk, ‘G’ is often overlooked. This pertains to consumers and even the companies themselves, many of which do not offer it. Even some of the largest Medicare Supplement companies in the country have chosen to omit ‘G’ from their plan offerings (including AARP/United Healthcare and Anthem BCBS in many states). Plan F is certainly the most convenient for the companies to explain (pays all deductible and co-pays – end of story) and consumer (don’t have any out of pocket costs for Medicare-covered costs at doctor/hospital); however, is it most convenient for your pocketbook?

The answer to that question comes in two parts – the now and the later. First of all, let’s deal with the “now”. For 2012, Medicare has reduced the Medicare Part B deductible from $162 to $140/year. Not much in insurance goes down, but this has! Politically-motivated or not, this is a “win” for people who have ‘G’, as their annual out of pocket costs have been reduced from $162/year to $140/year. You see, the only plan difference between ‘F’ and ‘G’ is the coverage of that Part B deductible. Now that it is $140/year, we can easily do the math and see that benefit is worth $11.67/month in premiums ($140 divided by 12 months). With that in mind, we can set ourselves to comparing ‘F’ and ‘G’ premiums. Now in nearly all cases, savings on Plan G are equal to or greater than $15/month. The average premium difference I see is around $20. Taking that example, you would save $240/year in exchange for paying $140/year. That’s $100 more than you had before you came to my website!

The 2nd implication in the ‘G’ vs. ‘F’ debate is called adverse selection. Now this is an insurance term that most people may not know. The short of it is that, on average, the people on ‘F’ are less healthy than the people on ‘G’. The reason for this is that ‘F’ is offered in several significant ‘guaranteed issue’ situations (no health questions asked) whereas ‘G’ is not. So say, for example, you’re losing your employer coverage 12/31/11 and you know you have a triple bypass scheduled for January 15, 2012. You can get a Medicare Supplement Plan F under ‘guaranteed issue’ due to losing the employer coverage, but you cannot get a Plan ‘G’. Over thousands and thousands of insureds, this leads to greater increases or more frequent increases on ‘F’ than on ‘G’.

Even after I explain these two facts – and they are facts, not opinions – many people say they prefer Plan F. And, that’s certainly okay. But the key is knowing the facts, not taking Plan F because your aunt who’s a nurse said to or because the commercial during the nightly news talked about it. If you want more information on these plans, what they cost or how they work, call us at 877.506.3378 or visit our website to request information at Medicare Supplement Quotes.


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