Does medicare supplement plan j cover part b deductible

October 2022 Announcement

Deductible Amount for Medigap High Deductible Options F, G & J for Calendar Year 2023

Summary:

Medicare supplemental (Medigap) Plans F and G can be sold with a high deductible option. Before June 1, 2010, Medigap Plan J could also be sold with a high deductible. The high deductible version of Plan F is only available to those who are not new to Medicare before 1/1/2020. High deductible G is available to individuals who are new to Medicare on or after 1/1/2020. People new to Medicare are those who turn 65 on or after January 1, 2020, and those who first become eligible for Medicare benefits due to age, disability or ESRD on or after January 1, 2020.

Effective January 1, 2023, the annual deductible amount for these three plans is $2,700. The deductible amount for the high deductible version of plans G, F and J represents the annual out-of-pocket expenses (excluding premiums) that a beneficiary must pay before these policies begin paying benefits. CMS updates the deductible amount for plans G, F and J each year, after release of the August Consumer Price Index for all Urban Consumers (CPI-U) figures by the Bureau of Labor Statistics, which generally occurs in mid-September.

Calculation of the Deductible:

The deductible for plans F, G and J is determined in accordance with section 1882(p)(11)(C)(i) of the Social Security Act. This provision prescribed a deductible of $1,500 for 1998 and 1999 and directed that the amount increase each subsequent year by the percent increase in the CPI-U, all items, US city average. The increase in the applicable CPI-U from 2022 to 2023 is 8.26%, which results in a deductible of $2,700 after rounding to the nearest $10 in accordance with section 1882(p)(11)(C)(ii) of the Social Security Act.

For Further Information:

Contact: Martha Wagley at 410-786-3778 for actuarial issues or Derrick Claggett at (410) 786-2113 for policy related issues.

If you need help regarding enrollment in a Medigap plan please contact your local State Health Insurance Assistance Program (SHIP). Find your local SHIP on Medicare.gov at https://www.medicare.gov/talk-to- someone. You can find Medigap plans available in your area on Medicare.gov at http://www.medicare.gov/medigap-supplemental-insurance-plans/.

Once eligible for Medicare coverage, the first step is signing up for Original Medicare, which includes Part A, for hospital stays and inpatient care, and Part B, for visits to the doctor’s office and outpatient care. Part A is sometimes referred to as premium-free Part A because most people are not required to pay for this portion of Medicare insurance because they have paid taxes while working.

Check your Social Security statement under the estimated benefits section, which includes a passage on Medicare. It will state if you have enough credits to qualify for Medicare coverage at 65 years old. Credits are earned by working, and most people need 40 credits to be eligible for benefits.

Options to Minimize Out-of-Pocket Costs

Original Medicare leaves a shortfall that impacts beneficiaries in terms of coinsurance, copayments, blood, deductibles, drugs, foreign travel emergencies and out-of-pocket limits. This is why many people decide to supplement their Medicare coverage with policies from Medicare-approved private insurance carriers.

A key decision is whether to sign up for a supplement plan that helps pay some of the out-of-pocket expenses or, instead, to enroll in a Medicare Advantage plan that marries Parts A, B and D. If you choose a Medicare supplement insurance policy, otherwise known as Medigap, you will need to sign up separately for Part D if you want drug coverage, a component excluded from the supplement plans currently available.

Medigap Plans Available
If you determine the best course of action for you is to supplement Original Medicare insurance with Medigap, you will be presented with up to eight plans to choose from in 2020. These plans are identified by letter: A, B, D, G, K, L, M and N. If you are wondering why the letters do not follow the alphabet precisely, it is because Plans E, H, I and J were eliminated in 2010, and C and F are being phased out after 2019.

Medicare Supplement Plan J
Before Plan J was discontinued in 2010, as a result of the Medicare Prescription Drug, Improvement and Modernization Act, it was highly favored relative to the other plans. Basic supplement plan coverage, which is Plan A, includes Medicare Part A coinsurance, hospital costs up to 365 days after all Medicare benefits have been used, Part B coinsurance or copayment, the first three pints of blood purchased per year and hospice coinsurance or copayments.

All the other Medicare Supplement plans are required to provide at least that much coverage. Plan J added coinsurance for a skilled nursing facility, Parts A and B deductibles, Part B excess charges, foreign travel emergencies up to plan limits, preventive care up to $120 per year, recovery at home up to $1600 per year and prescription drugs up to $3,000 per year.

Changes to Plan J
Changes in Original Medicare caused the demise of Plan J. Once Original Medicare began to cover wellness visits, home health services and introduced Part D for prescription drug coverage, the appeal of Plan J declined. However, the plan is grandfathered for those already enrolled. The plan termination only impacts new Medicare recipients shopping for supplement plans.

Medicare Supplement Plan Enrollment

When a Medicare recipient turns 65 years of age and is enrolled in Part B, they will have a guaranteed issue right to purchase any Medicare Supplement plan sold in the state. This 6-month initial enrollment period will allow you to choose from any available Medigap policy, but after this period ends, you may be subject to medical underwriting and can be rejected or charged more for a policy.

Does Medigap Plan G Cover Prescriptions?(Opens in a new browser tab)

How Does Medigap Insurance Work? (Opens in a new browser tab)