Benefit Changes Are Coming to Medicare in 2020
A new year often means a few changes to Medicare. Medicare costs typically fluctuate every year, but how will Medicare benefits change in 2020?
Here are a few Medicare benefit changes in 2020 that you may want to keep in mind.
Medigap First-Dollar Coverage Plans Will Be Discontinued for New Medicare Beneficiaries in 2020
January 1, 2020, is a key date for many newly eligible Medicare beneficiaries.
Anyone who becomes eligible for Medicare on or after Jan. 1, 2020, will not be able to apply for a Medicare Supplement Insurance (Medigap) plan that fully covers the Medicare Part B deductible. This impacts Medigap Plan F and Plan C.
If you become eligible for Medicare before this date, you can apply for Plan F or Plan C in 2020 and beyond, if either plan is offered where you live.
If you already have Plan F or Plan C before 2020, you will be able to keep your plan.
What Is the Medicare Access and CHIP Reauthorization Act (MACRA)?
The new rule that discontinues Plan F and Plan C enrollment for new Medicare beneficiaries in 2020 is a result of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).
MACRA phases out first-dollar Medicare Supplement insurance plans, with the intention of forcing Medicare Part B beneficiaries to keep some “skin in the game” by paying at least some costs out of their own pocket for Part B coverage.
The goal of the rule is to keep people from running to the doctor for every minor pain or symptom simply because they have full coverage for the costs of the appointment (if it’s covered by Medicare).
High-Deductible Medigap Plan G Will Be a New Plan Option in 2020
Beginning in 2020, Medigap Plan G will feature a new high-deductible plan option.
If you enroll in high-deductible Plan G, you must first pay out-of-pocket costs for your covered care until you reach a set deductible amount. Once you reach your deductible, your Plan G benefits kick in for the remainder of the year.
Currently, high deductible Plan F is the only other Medigap plan to feature a high-deductible option. It will still be available to beneficiaries eligible for Medicare before Jan. 1, 2020.
The Medicare Part D Donut Hole Will Shrink in 2020
The Medicare Part D “donut hole” is a temporary lapse in Part D prescription drug coverage once your out-of-pocket prescription drug spending has reached a certain amount for the year.
A few things are changing about the Medicare Donut Hole in 2020:
You will have to spend more on your covered drug costs before you reach the donut hole in 2020.
In 2019, Part D beneficiaries entered the donut hole coverage gap after spending $3,820 on covered drugs. The Part D initial coverage phase spending threshold will increase to $4,020 in 2020.
Once you’re in the donut hole in 2020, it will require more spending to escape it.
In 2019, beneficiaries left the donut hole coverage phase and entered the catastrophic coverage phase after spending $5,100 on covered drugs. In 2020, the amount you are required to spend before you enter the catastrophic coverage phase is $6,350.
In 2019, Part D beneficiaries pay 37% of the cost of generic drugs while in the donut hole, but that amount will decrease in 2020.
In 2020, Part D beneficiaries will pay 25% of the cost of generic drugs and brand name drugs when they are in the donut hole coverage gap.
Medicare Advantage plans continue to add additional benefits
Medicare Advantage (Medicare Part C) plans provide the same benefits as Original Medicare, and some plans may offer a number of benefits not found in Original Medicare.
Many Medicare Advantage plans cover prescription drugs, and some Medicare Advantage plans even offer things like dental, vision, allowances for hearing aids, gym memberships and more.
Medicare Advantage plans gained approval to begin offering new benefits for 2019, as long as the service is deemed “primarily health-related.”
This can include benefits such as:
Home health care services
Caregiver support services
Adult day care and other support services
Non-emergency transportation, like visits to your doctor’s office
While some Medicare Advantage plans offered these and similar benefits for the 2019 plan year, many more are expected to do so in 2020. In fact, the Centers for Medicare and Medicaid Services (CMS) expects around 500 Medicare Advantage plans nationwide to offer these benefits to about 2.6 million enrollees.1
Keep in mind, not all plans will offer new benefits like these. Be sure to speak with a licensed insurance agent who can walk you through different plan benefits in detail.
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1 Gleckman, Howard. Medicare Advantage Plans Are Expanding Personal Supports and Services For 2020. Forbes (Oct. 7, 2019). Retrieved from https://www.forbes.com/sites/howardgleckman/2019/10/07/medicare-advantage-plans-are-expanding-personal-supports-and-services-for-2020/#71436f605f1b.
Christian Worstell is a health care and policy writer for MedicareSupplement.com. He has written hundreds of articles helping people better understand their Medicare coverage options.