Medigap Shopping: Closing the Book & Rate Increases

[CRLLS]

We started out with F-HD. It is not uncommon for a provider to send the bill to Medicare but also send a bill to us. Medicare does its thing and sends it on to the Medigap provider. I have received bills from providers after Medicare has done their thing and before the Medigap has done theirs. When the provider sees it, then they can send a corrected bill with modified coding back to Medicare. In the meantime, the Medigap guys pay their share of the wrong Medicare approved amount. It can be quite the job to keep all the bills and payments matched up. Especially when it could be a 6 or more month process and the Provider keeps sending you bills. I cannot imagine doing this when I'm 85+ years old.

When we had the opportunity, we switched to Plan G. I ignore most every bill after we meet our 2 Medicare deductibles. Frankly, I don't even watch that too closely. Tracking the various payments are not enjoyable or a good use of my retirement time. Isn't that what we saved up for when we were working?

 

[Lstansbury]

I've watched several of the Giardini videos. I've spent some time on the serff website. Thank you all for your useful inputs. At this point, I'm really not seeing any useful decision tools. I'm planning on G-HD and for several companies I've looked at in my state, the rate filings have indicated very low loss ratios and no requests to hike G-HD premiums. The opposite is true for F and G. I've also reviewed some ten year rate histories that have some years with 20% increases and some with zero. I'm guessing that it is more based upon loss ratio history than which company. IOW, there are no "bad" insurance companies, just "bad" pools of insured buyers. I have no way of knowing if the plan I sign up for is more or less likely to attract people with higher than average future health needs. Many don't know. Those who do likely gravitate towards the non-HD plans. Even if I were in bad health, it likely wouldn't be bad enough year after year to tilt the CBA towards a non-HD plan. So, at this point I've discovered what I already knew. Plan G-HD is an obvious choice. Beyond that? It's hard to say. I checked the major players like Aetna and Humana, and they each have less than 50 G-HD policies in force. G-HD is relatively new, and it appears that about 90% of folks shun any HD plan. If I had to decide today, I might flip a coin between Humana and Globe Life. Mutual of Omaha, Cigna and Aetna have their critics, but that may just be because they are larger and have made more customers mad with necessary rate increases. Since all players are equally regulated by the state, I can't see how they could abuse the system. Maybe I'm missing something. From watching the videos, it appears that the small companies who use TPAs are more likely to close and open pools, which may work to my detriment more than the large companies. I think we have our answer to this. Nobody knows!!!! LOL. I'll keep scratching my head....

Firechief, do you have access to an Innovative High Deductible G plan? Physicians Mutual is the only one doing it in my area. It is not available in California, that much I know. But it is in at least 30+ other states.
You get a lower premium rate - close to a HD plan but not as low -- and a deductible of $2850 (plus Infl) for 3 years only. Then you no longer will have a deductible. Ever. But your base premium rate stays at that lower rate for the life of the policy. I'm an agent and I'm recommending my clients look closely at it. I'd love to be able to buy it myself, but am dealing with a health issue and can't pass underwriting to switch to it.

 

[FIREchief]

Firechief, do you have access to an Innovative High Deductible G plan? Physicians Mutual is the only one doing it in my area. It is not available in California, that much I know. But it is in at least 30+ other states.
You get a lower premium rate - close to a HD plan but not as low -- and a deductible of $2850 (plus Infl) for 3 years only. Then you no longer will have a deductible. Ever. But your base premium rate stays at that lower rate for the life of the policy. I'm an agent and I'm recommending my clients look closely at it. I'd love to be able to buy it myself, but am dealing with a health issue and can't pass underwriting to switch to it.

I don't have access to an Innovative High Deductible G plan. Thanks for the heads up though!

 

[FIREchief]

I ignore most every bill after we meet our 2 Medicare deductibles. Frankly, I don't even watch that too closely. Tracking the various payments are not enjoyable or a good use of my retirement time. Isn't that what we saved up for when we were working?

I think you may be exaggerating this a bit. Getting a bill from a medical provider is not a horrible experience that spoils a person's retirement. I've been retired for ten years and spending 15 minutes a week tracking something and making payments is likely good for my brain. We have computers and the internet now where all of this is quite simple.

 

[CRLLS]

I think you may be exaggerating this a bit. Getting a bill from a medical provider is not a horrible experience that spoils a person's retirement. I've been retired for ten years and spending 15 minutes a week tracking something and making payments is likely good for my brain. We have computers and the internet now where all of this is quite simple.

I am not exaggerating. It isn't a horrible experience. But dealing with the same bill over several months waiting for the bills reconcile themselves out and following the back and forth with the claims, waiting for paying my responsible amount is painful. That is not another exaggeration. Also while I can do all of this now, maybe not able to later on. Maybe I can even continue to do it all the way to my eventual expiration date. I don't want to leave this job to my DW when I'm gone.

If you chose to do so, more power to you. It is not my idea of a fun way to spend time. I have many other things to exercise my brain that I do enjoy. I'll stick with them instead and let Plan G take care of the rest. I saved to enjoy my retirement.

 

[audreyh1]

If you chose to do so, more power to you. It is not my idea of a fun way to spend time. I have many other things to exercise my brain that I do enjoy. I'll stick with them instead and let Plan G take care of the rest. I saved to enjoy my retirement.

exactly!

 

[FIREchief]

If you chose to do so, more power to you. It is not my idea of a fun way to spend time. I have many other things to exercise my brain that I do enjoy. I'll stick with them instead and let Plan G take care of the rest. I saved to enjoy my retirement.

It's neither fun nor painful. I've been retired for ten years and can't recall a single instance where paying a routine bill has ruined my fun. It is fun to be able to pay the bills, even more when I know that G-HD is saving me a ton of money! If that fails, I have responsible, helpful adult children that will be more than happy to help mom or dad in their old age. But, you do you. If it is worth thousands of dollars to avoid five minutes of work now and then, more power to you.

 

[CRLLS]

It's neither fun nor painful. I've been retired for ten years and can't recall a single instance where paying a routine bill has ruined my fun. It is fun to be able to pay the bills, even more when I know that G-HD is saving me a ton of money! If that fails, I have responsible, helpful adult children that will be more than happy to help mom or dad in their old age. But, you do you. If it is worth thousands of dollars to avoid five minutes of work now and then, more power to you.

Worth thousands of dollars is a bit of an overstatement until one is in or above their mid-seventies from what I can tell from my state's SHIP. Maybe around $1,200-$1400 for one just entering Medicare. It does go up over the years.

However, you are missing the big offsetting point that Plan G has no deductible. Once the Medicare Deductible is met, coverage is 100%. This year, a person with Plan G-HD could pay up to $2613 more than the comparable person on a Plan G. It becomes a gamble on one's medical needs over a lifetime (in many states) to which Plan saves more. Unfortunately, one won't know the benefit of one over the other until their demise, at which point it is moot.

I will do me. Thanks for the discussion.

 

[FIREchief]

This year, a person with Plan G-HD could pay up to $2613 more than the comparable person on a Plan G.

$2618? Regardless, you're leaving the difference in premiums out of your equation. In my state, the difference between the lowest cost G and the lowest cost G-HD is $912 per year

So the "worst case scenario" is $1706 per year if I exceed the deductible every single year. That means that my Medicare negotiated rate based medical claims beyond the first $257 (Part B deductible) would have to exceed $2618/.2 = $13,090 every year. That ain't happening any time soon, and if it does? I'll just eat the $1706 and cover it for a while with earlier year savings. Keep in mind, for a calm year, I'm pocketing $2618 every year. So yes, thousands of dollars, especially over five or ten years.

Don't get me wrong. I love it when people eschew G-HD because they stub their toe once in a while. It just keeps the pool healthier for the rest of us.

 

[ncbill]

G-HD not going 'dead pool' like many G plans is a huge plus.

Downside is tracking more money until you hit the G-HD 'deducible' which is really the maximum OOP.

 

[youbet]

Is it correct to say that all "F" plans have "closed the book" since no new entrants are allowed?

If so, does that imply that "F" plans will likely increase premiums at a greater rate than "G" plans going forward as the "F" plan pool of participants ages due to no new, younger entrants?

 

[CRLLS]

YouBet, my understanding is that if you were eligible to purchase Medicare before January 1, 2020, you are still allowed to purchase Plan F, both now and in the future. Some states allow switching without underwriting. Some would require underwriting. Some people stay working after 65, have coverage from their employer and can purchase at any age without penalty when they lose their employer coverage. There are likely other situations that would fit that small group. With such a small group eligible for Plan F, it follows that Plan F would most likely be considered a closed book even though it really isn't. The wisdom at the time of the change was that Plan F would increase premiums faster than Plan G. That is when we switched to Plan G. I'm not sure if the faster increases held true, but it is still very early Medicare-wise to know for sure. I am not aware why anyone would want to purchase a Plan F. I'm sure they have their reasons.

 

[FIREchief]

YouBet, my understanding is that if you were eligible to purchase Medicare before January 1, 2020, you are still allowed to purchase Plan F, both now and in the future. Some states allow switching without underwriting. Some would require underwriting. Some people stay working after 65, have coverage from their employer and can purchase at any age without penalty when they lose their employer coverage. There are likely other situations that would fit that small group. With such a small group eligible for Plan F, it follows that Plan F would most likely be considered a closed book even though it really isn't. The wisdom at the time of the change was that Plan F would increase premiums faster than Plan G. That is when we switched to Plan G. I'm not sure if the faster increases held true, but it is still very early Medicare-wise to know for sure. I am not aware why anyone would want to purchase a Plan F. I'm sure they have their reasons.

Why would anybody with a choice go with F rather than G at this point?

 

[CRLLS]

In looking this up, I found conflicting answers for G-HD. This is one reason I don't like AI answers:

 

[Dtail]

Why would anybody with a choice go with F rather than G at this point?

Not for me, but saving on premiums if one has infrequent doctor visits.

 

[CRLLS]

Firechief, did you read my last 2 sentences?

I am not aware why anyone would want to purchase a Plan F. I'm sure they have their reasons.

 

[audreyh1]

Why would anybody with a choice go with F rather than G at this point?

Plan F is only available to those who turned 65 before Jan 1 2020 and has no deductible at all, so no billing hassle from day 1.

 

[Dtail]

Not for me, but saving on premiums if one has infrequent doctor visits.

Oh thought I saw Plan N. Oops.

 

[FIREchief]

Firechief, did you read my last 2 sentences?

I am not aware why anyone would want to purchase a Plan F. I'm sure they have their reasons.

I did. I wasn't asking you. It was mostly a rhetorical question. Since all F plans are essentially dead pools, why would anybody jump in? The answer: they don't understand this stuff.

 

[FIREchief]

Plan F is only available to those who turned 65 before Jan 1 2020 and has no deductible at all, so no billing hassle from day 1.

You are likely right and those who choose this path are likely wrong.

 

[sengsational]

Wouldn't that have been the case irrespective of the plan you have? If they never sent the bill, medicare/medigap wouldn't have paid it and they would have come after you.

This "dealing with the billing" is so hard to quantify without having first hand or even second hand experience. What do those bills look like after they've been to medicare & your medigap provider? Can anyone share real bills (appropriately scrubbed of course) that they have to deal with - for say a hospital visit - either from medicare or the medigap provider? Or a site that shows these bills?

I can find images of these bills, but very little context.

Like many here, I'm leaning towards Plan G only because I don't have any idea about how complex it is to deal with the billing. I've had an PPO/HMO plan for the last 15+ years and billing has been easy. They tell me what to pay & I pay it. But - and this is a big but - neither of us have had any serious illness that needed surgery or hospitalization. The biggest, most complicated bill was for an urgent care visit that involved some scans & stitches.

One specific problem with billing is that providers have a financial incentive to "forget to bill Medicare."

Say you have a bill from a hospital that has 50 items on it. They push 47 of them through to Medicare and those get Medicare prices. With HD, you get billed for 20% of the Medicare price for those 47, and the default price (charge master insane price) for the last 3. You can request a detailed bill from the hospital, but it probably won't show Medicare payments by procedure code. Instead it will show each procedure code with some fictional price, then have a big subtraction for Medicare. So that leaves you with paying charge master rates for the things they "forgot" to send to Medicare. Those rates are maybe 5X what they'd get from Medicare.

If you had a low deductible, you would know immediately something was wrong. A high deductible, you would have to match up each line item of the hospital bill with the Medicare claim and find which procedures were not put through to Medicare. And if that doesn't sound enough like a headache, realize that this set of procedures is submitted not as a single claim, but many claims, so matching isn't a walk in the park.

Just for "fun", I wrote a desktop application that took my Medicare download and matched it to a hospital bill. It would have been much faster to reconcile by hand, but it was hobby coding. I was thinking of leveraging the desktop app to make a mobile app, but the problem is that every hospital's billing format is different. There should be a law where hospitals must deliver a machine readable (not just machine printable) bill, then we could hold their feet to the fire!

 

[youbet]

Plan F is only available to those who turned 65 before Jan 1 2020 and has no deductible at all, so no billing hassle from day 1.

Thanks audrey. I stuck with my Plan F until recently. The few hundred bux I paid in premiums that exceeded the deductible coverage meant absolutely nothing to me and it was convenient to never receive a bill, ever, for years. But, recently my provider sent a letter increasing rates where I thought a phone call was in order. As a result of that call I'm switching to a Secure G plan where I'll save a few hundred bux annually based on lower premiums minus paying the deductible. Not a big deal, but I suppose I should make a stab at spending efficiency even though it's inconsequential.

 

[mf15]

So far so good with the F-HD premium. 69/month, I think I started 11 years ago at 66/month.

 

[CaptTom]

One specific problem with billing is that providers have a financial incentive to "forget to bill Medicare."

Thanks for the heads-up! We've got a bunch of bills coming from a big hospitalization. I plan to do my due diligence and try to line them all up. For a previous insurer I did set up a database to hold all the EOB data, and some simple analysis tools. But I think you're right that a simple spreadsheet, matching everything up by hand, will probably be easier.

I'm a little surprised at how long it's taking. The surgery was late last year, and I still haven't seen a bill from the hospital. Just bills for the outpatient stuff.

 

[sengsational]

Right now my process starts with a set of manual steps, then I run my desktop app and it merges everything together. I can output at the claim level or at the procedure level. And I have a heuristic that only outputs "open" claims (the ones not yet wrapped-up for a variety of reasons and the ones that might possibly need attention based on what the Medicare line item looks like).

/**
* Log into medicare.gov > User > Download My Claims and Personal Data > Claims > 36 months > TXT
*
* Log into UnitedHealthcare > Claims Date Range Current Year > Download Claims (CSV)
*
* Update file C:\Users\Owner\Documents\my\Medical\Insurance and Billing\Medicare\MyPayments.csv with any copays or deductibles I have paid
*
* Update file C:\Users\Owner\Documents\my\Medical\Insurance and Billing\Medicare\MSNList.csv with data from paper MSN's
*
* Update file C:\Users\Owner\Documents\my\Medical\Insurance and Billing\Medicare\AppealsList.csv from my appeals files and folders
*
*/

One of the problems with doing it this way is that the medicare.gov download lacks information, and so does the UHC download. There are programming API's for Medicare and UHC, but the authentication, as you might imagine, is tricky.

To wrap this post back to the "Medigap Shopping" topic: If you choose plan G, you can probably ignore all of the billing details because you can easily see when some entity is trying to bill more than your small deductible; no need to do any analysis. This can't be said for HD policies, because you're going to have some big bills to pay, and you don't know if it's the 20% or the chargemaster.