Medigap Plan J – Gone But Not Forgotten

Medigap Plan J was the 2nd most popular Medigap plan when it was available. It’s run ended in June 2010, when Medicare revised the standardized Medigap plans chart, eliminating Plan J, revising some of the other plans, and adding a couple of new plans. At that time, current Medigap Plan J policyholders were “grandfathered in” so they could keep their current plan. Many elected to do so, either by choice or necessity (i.e. couldn’t qualify for another plan health-wise) and so there are still a large number of people who have Plan J. In 2011, according to the latest reports on Medigap by AHIP, approximately 10% of people still have Plan J. There are a few ramifications of this, both positive and negative, which we will go over here.

  • First of all, Plan J is no longer sold, as discussed above. The highest level of coverage currently is Plan F, which has replaced Plan J as the most comprehensive plan. This means that the benefits that are offered under “old” Plan J’s are no longer available through existing plans. These two benefits – preventive care and at home recovery – have been, in large part (particularly preventive care: does Medicare cover preventive care?), rolled into Medicare’s benefits. So although they are no longer available through the Medicare Supplement plans, they are still a part of your Medicare benefits.
  • The other important thing to know about Plan J is that, if you have the plan and decide to leave it for any reason, it is gone forever. You cannot get it back once you lose/terminate it.
  • Next, you should understand, if you have Plan J, that Plan F would provide essentially the same benefits at a fraction of the cost of your current J premium in most cases.
  • Plan J is what is considered a “closed” block of business. This just means that no new people can be enrolled into this plan. This has some pretty significant ramifications, the most important of which is that the people on ‘J’ will continue to get older, with no younger (and on average, healthier) people to offset their claims. Over time, this will certainly have a detrimental effect on the Plan J rates.

If you have Plan J and you are reading this, it is likely that you either are not interested in changing plans to save money or are not able to, due to a significant pre-existing condition. However, if you are in relatively good health and still have a Plan J, that means you have had it for 2 or more years and your premium savings, for equal coverage from a Plan F, would likely be in the $500-1000/year range.

To get more specifics about how much you can save off of your Plan J rates or how Medigap plans work, please visit us online or call us at 877.506.3378.

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