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There are policy makers and think tanks who believe that Medigap coverage, especially Plan G (the most popular option) insulates retirees from out of pocket costs too much and as a result encourages them to use unnecessary health care, to not care what it costs.
I don’t know about you, but I have no desire to use any healthcare beyond what is absolutely necessary. In any case, discussions are underway to increase the out of pocket costs under Medicare with the idea of saving federal funds.
Instead of the current Medicap policies, a minimum OOP would be required.
The proposal being discussed would require Medigap policies to leave beneficiaries with some minimum amount of their own Medicare cost sharing rather than allowing supplemental insurance to cover virtually everything.
“Minimum” is hardly a uniform amount for all income levels among seniors.
One specific framework discussed recently would:
For many retirees those amounts are not so minimal. The only positive for some retirees is that the Medigap premiums should decrease.
For this theory to be correct retirees are using more care than needed, providers are ordering a great deal of unnecessary healthcare and Medicare is not efficiently monitoring claims.
In any case, it’s a good idea to keep an eye on all efforts to lower spending on Medicare. The Part A trust will be depleted around the same time as SS, so something has to change.
Folks planning for retirement these days have to deal with a lot of moving parts as the two main components of SS and Medicare are under stress.
My medigap (plan G) goes up double digits percent each tear. I do see a lot of Doctors.
My wife’s medigap (also plan G) only goes up a few dollars every year. But then she is much healthier than I am.
Premiums are not based on individual usage. They vary by whether they are community based, entry age based or current age based.
I am curious. How many people are knowingly “using unnecessary health care”? I certainly do not. My wife doesn’t.
My first reaction is to question who the “policy makers” are and what their agenda is.
Medicare Supplement insurance exists because of the lack of coverage and the costs of traditional Medicare Parts A & B.
Medicare Advantage plans appeal to some people because they believe they are less expensive and offer “free additional benefits.” Neither statement is generally true in all instances.
MedPAC stands for the Medicare Payment Advisory Commission which is where the idea originated.
I don’t use unnecessary care, but I know people who regularly go to doctors and they always find something to test or treat. In fact, they go so often a son is paying for them to have a concierge medicine.