A few years ago, we received a letter from an AMAC member, Arthur, who was struggling with his health care costs. Arthur had the same coverage since he became Medicare eligible at age 65, and each year he found himself paying exorbitant premiums and astronomical drug costs. He wrote this off to inflation- a story we are all familiar with.
He explained in his letter that at the time when he was first Medicare eligible, it appeared there was only one organization offering Medigap plans. Although he did not believe in the same values as this organization, he wanted to make sure he did not miss out on coverage he would need as he got older. This is an all-too-common mistake many make.
Arthur enrolled in a Medicare Supplement plan F, which at the time was highly advertised. Now, the insurance company he chose had a very attractive rate at the beginning, but as time went on it became completely unaffordable. Arthur was under the impression that his carrier was the only one offering plan F and he was afraid he would lose his doctors if he switched to another carrier.
The truth is, all the Medigap plan letters are standardized, so a plan F has the exact same core benefits regardless of the carrier you choose. Failing to shop around, Arthur was paying $3000 annually for the same plan that would cost him $1800 with another company. Since none of the Medigaps have a network, there was no risk in losing his doctors either!
Another option he overlooked was changing his plan letter. Plan G is very similar to plan F, the only difference being that plan F pays your part B deductible (which is $203 in 2021) and plan G does not. Arthur had the option of picking up a minimal deductible in exchange for an even lower premium, and he did not even know it.
Moreover, since he never shopped around, he had no idea there were lower cost drug plans. When it comes to Drug plans and Medicare Advantage plans, it is important to shop around because they are subject to change on an annual basis and some may leave the market completely! The Annual Enrollment Period to change your Drug plan or Medicare Advantage plan is October 15-December 7th. However, you may change your Medigap at any time.
Alas, there was light at the end of the tunnel! I called Arthur immediately after receiving his letter and went over his plan options in detail. I was eager to let him know he was not forced to stay with the organization he initially chose. Not only was Arthur delighted with his newfound savings and switched his plans, but he wrote another letter stating how pleased he was with AMAC’s services.
Want to evaluate your coverage? Call 1-800-334-9330 and one of AMAC’s trusted, licensed Insurance Agents will be happy to assist you with your needs.