As you're likely aware, most states offer 10 different Medicare Supplement Insurance (Medigap) plans, designated by letters A through N. The most popular and comprehensive plan is Medigap Plan F. Because it offers the most complete coverage, it also usually has the highest premiums. Not everyone can afford Medigap Plan F coverage, so there is an alternate plan available: Medigap Plan F High Deductible (sometimes called Plan HDF).
What is Medigap Plan F High Deductible?
While the traditional Medigap Plan F is typically one of the more expensive Medigap plans due to its comprehensive coverage, Medigap HDF is often one of the least expensive plans. It offers the same coverage as Plan F, however, as the name implies, it comes with a high deductible ($2,240 in 2018). In other words, in exchange for a much lower monthly premium, you'll be expected to pay a deductible for medical services. Traditional Plan F, on the other hand, has a higher premium, but you pay no deductibles.
How Much Does Medigap Plan F High Deductible Cost?
Let's look at some specific numbers and compare the costs of Medigap Plan HDF with Medigap Plan F. For this example we'll use real quotes for a 65 year old female living in Miami-Dade County, Florida (note: Miami-Dade is one of the more expensive Medigap counties). Her monthly premium for Medigap Plan F is $248. She could get a Medigap Plan F High Deductible plan for as little as $66 per month. Annualized, she'd pay $2,976 for Plan F or $792 for Plan HDF. That's a $2,184 annual savings on premiums if she chooses Plan F High Deductible.
Wait, we said Plan F was the most popular Medigap plan. Why wouldn't everyone just choose Plan HDF and save $2,184? Remember, Plan HDF has a high deductible. Plan F High Deductible doesn't start paying for medical services until after you've paid $2,200 in deductible (but keep in mind that Medicare will still be paying its 80% share). In this example, the deductible is almost exactly the same amount as your savings.
If your savings in premiums is more than the $2,200 deductible, it makes sense to choose Plan HDF over Plan F. Even if your premium savings isn't $2,200, but you're in good health and have a healthy family history, Plan F High Deductible might be right for you because if you don't end up spending $2,200 in medical expenses you'll save yourself money.
We can run free quotes for you and help you compare your expected expenses with Medigap Plans F and F High Deductible. If these plans are out of your price range, we can also help you explore whether Medicare Advantage (which sometimes has no premiums at all) might be best for you.
