Clarifications on the future of Medigap Plan F
After returning from the 2016 National Medicare Supplement Insurance Summit, I am more than ever excited about the future of our industry.
This year's conference was in Kansas City, Missouri and was the largest one since its inception. I felt that every session I attended was very much worth my time. My main takeaway was that even though there are changes coming to the industry, they will make agents even more necessary for the help they can provide to senior consumers in making wise choices.
About Plan F
Following last year's conference, I wrote about the changes coming in 2020 regarding plans C and F. The government called this the Medicare Access & CHIP Reauthorization Act of 2015 (MACRA). Overall, it's all about the means for the Federal Government to cut expenses. This is primarily focused on Medicare expenses from hospitals and doctors, including the "first dollar" type of insurance we have had with plans C and F.
The announcement by the Feds in Washington was made while the Medigap conference was being held in Orlando. Upon my return I passed along the information regarding the changes with the Plan F and at that time it was the hottest news in the industry. It was so new that some of you thought I was crazy and acted like it was my idea to change the Plan F!
The buzz for this meeting centered around the question "if the plans C and F were not going to be available for eligibles after 1/1/2020, then what plan would be the Guaranteed Issue (GI)?
Plans D & G are the new GI plans
The answer is that it will be plans D and G. That will change the complexion of those plans, as we know what happens to a block of business when it gets hit with "turning 65" business with no underwriting and GI business with no underwriting - claims have a steep increase and it make premiums more expensive.
It should also be noted that beneficiaries who are eligible prior to 1/1/2020 will always be able to buy plan C or F going forward. That pool of people is in excess of 60 million strong. That makes me wonder if - down the road - the plan F could eventually be the plan of choice again, as it will be the one that is not getting all the age-in and GI business.
I will keep you posted on other changes that are coming in updates to follow. Rest assured we are in the right market and the best days are ahead of us!
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