Is High Deductible Plan F the Best

[somarco]

Couple of observations, Junkman.

I believe TN uses attained age for Medigap. GA has entry age. Not sure how many states are attained vs entry but here at least another year does not trigger an increase. Yes, we get rate increases but not just for living to our next birthday.

FWIW, I have had a deductible of at least $5,000 for over 10 years prior to going on Medicare. Most of my U65 clients also had deductibles of $5,000+ but a few had lower deductible copay plans.

Biggest challenge to those 65+ with high deductibles (or high OOP for MA plans) is most are living on a "fixed income".

Coming up with $2,000 or $4,000 or more when you have income is (can be) simple enough if you have a paycheck. Not so much when you quit working and are living off SS, savings and retirement.

 

[junkman]

The last I looked TN rates step up with age. Commissions are paid on 1st year premium - but I haven't looked within the last year.

I intentionally didn't make assumptions about the OP's income. "Fixed income" isn't hard to deal with unless it is low relative to living expenses.

I always look at incremental premium and incremental risk reduction. High F at age 65 used to save ~$700/year. The risk reduction is ~$2,000 depending on plan year, mandatory design changes, bla, bla, bla. An insured needs to go into the hospital twice or incur Part B expenses of $10,000 (10K x .2 = $2,000).

The choice comes down to High F or G depending on what the person wants. We all know that a few pennies can be saved with G over F but it is really not significant especially for those with assets or income.

When I talk to people with low income, they frequently opt for lower premiums even with their higher out of pocket expenses. The only exception I've found is with a highly subsidized premium that results in a significant out of pocket reduction and a small premium increase. My economics professor would attribute this to the marginal utility of a 1st (and known) dollar over a later (possible) dollar.

I've met people in their 40s with heart problems and diabetes. There are those in their mid to late 70s that are healthy. One friend of mine worked as a landscaper until 85 - probably because he kept working as a landscaper doing what he'd always done.

I think the OP has enough information in this thread and only needs actual rates that apply to him to make a decision. Perhaps he'll PM someone licensed here and have them write the policy.

 

[LostDollar]

More another day, Only have time for a brief response today.

(Ks seems to be mostly attained age. Transamerica offers issue age on many, but not all, plans. I think (regular) F has a larger group of issue age companies.

Money IS a concern (basically just SS for me), which is why I was contemplating HDF and banking some extra. (issue age to ameliorate 2020 turmoil.)

Two R words Risk and Responsibility.
Two concepts; Single and Risk, married and responsibility.

A decision hangup. I really, really (did I mention the word really?) hate to think of giving an insurance company money I think I could manage myself. However, in pre decision deadline time available so far, I have not been able to come up with a realistically responsible alternative (starting at age 72 rather than 65) for the complete timeframe which I believe this decision could affect; but am still not emotionally ready to give it up and skip merrily down the path.

 

[somarco]

Premium difference in N vs HDF here is around $40/month.

Me - For $40/month you reduce a $2200 deductible to $166. Does that work for you?

Most of the time the answer is yes.

KISS.

 

[LostDollar]

Ks Ins Commissioner has on line rates, but Cigna wasn't posted yet-as of last week. Cigna has some kind of new Medigap marketing going on-KS is one of the early states. (Sounds like an election.)

Here is roughly what I think my KS rates are:
Attained age except one noted otherwise:

Plan HDF Std Life (TX) $42
Plan HDF Cigna $50
Plan HDF Medico $53
Plan HDF Bankers Fid Life Issue Age $55 (or may be $57 now)
Plan N Cigna $115
Plan N Aetna $133
Plan G Cigna $136
Plan G Aetna $150
Plan F Cigna $165
Plan F Aetna $205

When I started checking in Aug, Most online folks did not want to sell me anything below Aetna. In Sept I got a gravy list email back from one potential agent offering Cigna as a lower priced alternative.

One broker terminated all discussion when I mentioned HDF, Std Life, and Cigna in the same sentence.

Another broker that wanted me to buy Aetna told me we would not be doing business when I mentioned HDF and Cigna in the same sentence.

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This link suggests that the actual risk reduction is often not the full deductible amount. These are old numbers, I don't know how to acquire more current ones, but the principle should still be the same.

High Deductible "Plan F" Supplemental Insurance Low Cost Policy

 

[junkman]

Lost, what state are you in? Someone here will write whatever you want. Getting rates is easy if all you have to do is call the carrier and get licensed. Splitting hairs between $50 & $42 isn't necessary to come up with a good strategy. There are subjective things like how easy is a carrier to do business with or how strong is the agent's relationship with the carrier to over ride a few dollars in premium.

 

[LostDollar]

Premium difference in N vs HDF here is around $40/month.

Me - For $40/month you reduce a $2200 deductible to $166. Does that work for you?

Most of the time the answer is yes.

KISS.

The best answer I have to this is your post in another thread:

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One other thing.

People buy on emotion, not logic. An agent can show brochures and charts on how many people will have cancer, hit their OOP max, blah, blah but without emotion they will rarely make a sale.

Keep the discussion on a personal level. Do you like your doctor(s)? Do you want to keep your doctor(s)? If you had to go to the hospital, do you have a preference? Does it matter if you need a referral to see a specialist?

You usually don't have to get too deep before you find out what is important to them.

When you discover that, and show them the least complicated way of solving their problem, they are ready to buy.

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"You usually don't have to get too deep before you find out what is important to them."

And when I saw that statement, I realized that the thing which was important to me was not releasing my money to the insurance or medical systems before I had to. Thus HDF, even though the economics could be a bit of a challenge.

 

[alphawave2k]

And one more thing to consider between a low deductible F/G vs a HDF. Men presumably are more stubborn than women when it comes to many things...wanting to ask for directions (guilty!). I know we have GPS now, but get into some areas where no GPS, capiche? Men pretend to be strong as an ox and don't need to see the Dr. (guilty!)...it's nothing I don't need to go see the Dr. One of my buddy's said he had the same pain and it went away after a couple of years ....be a man and live with a little pain. You're not alive if you don't feel any pain..no pain no gain??
Since my recent small epiphany of sorts on the HDF Supp plans, still think they could make sense for healthy folks due premium savings with the discipline of saving it for when necessary, I was thinking it could also bite someone in the derriere as well. Since we've been conditioned for "little co-pays" to see the Doc. and so on, and now we have a plan where I have to pay $2.2K before the plan pays anything I'm going to be further incentivized to not see the Doc until "it's serious" b/c I'm sure it's nothing, and why pay until it becomes absolutely necessary. So for some people, it might be a "death trap"...exaggeration but to make a point.

 

[LostDollar]

Yes, and at age 72 I've already lost a good portion of the "free" time one might expect. However I have already had the "obligatory" engagement with cancer and am in reasonably good health otherwise. On current finances, which also can change, I can put $125 a month aside in a savings account. I figure (by a highly precise and scientific evaluation :biglaugh: ) that I have some chance of going to 15 years for a breakeven with that money. After that, I don't know. The deductible will also go up, so one cannot plan for a static $2180. It's interesting,
the HDF, the HDG which will come, L and N all leave a person exposed to a potentially large number in different ways.

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. I know we have GPS now, but get into some areas where no GPS, capiche? .

What's a GPS? I live on Social Security. I can buy food and get a free map at the Mobil station.

 

[somarco]

My GPS is a woman. I always ask how to get someplace where I haven't been before, and I turn when she tells me.