Medicare Supplement Plan F, also known as Medigap Plan F, is and has been by far the most popular plan purchased by seniors looking for the most complete Medicare coverage. It’s also the most expensive, with premiums ranging from $150-$250 per person, per month. I say most complete, because Plan F pays the rest of the charges Original Medicare doesn’t charge plus an additional amount called, “excess charges.” What are excess charges? The vast majority of doctors and hospitals across the country accept what’s called, “Medicare Assignment.”
In plain English, that means Medicare says they’ll pay them a certain amount for a procedure or a doctor’s visit, and those doctors and hospitals essentially say, “OK.” These folks are considered to be “participating” in Medicare. In return, they’re not allowed to bill the person receiving medical care any additional amounts. If the doctor, hospital or facility does NOT accept Medicare Assignment (non-participating) they can still bill Medicare, get paid and then bill YOU an additional 15% above and beyond what Medicare paid them. This is called the Medicare Excess Charge. Of course, doctors and hospitals that opt out of Medicare altogether can bill you whatever they want.
Before you get all worried about these charges, it’s important to put them in perspective. Over 99% of doctors and hospitals across the country accept Medicare Assignment. The doctors and hospitals that don’t are usually specialty cancer centers or research institutions.
Medicare Supplement Plan F is the only Medicare supplement product that covers that additional 15% should you need it. Odds are you won’t, but if you like that security blanket (and it seems many do, based on the popularity) then Medicare Supplement Plan F is for you.
Of course, and this is true with all Medicare Supplement buyers, most folks buy these because they want the freedom to choose any doctor or hospital they want, don’t want the hassle of a network (PPO or HMO) and they can afford the monthly premium.
One last note: Medicare Supplement Plan C (second most popular plan) is essentially Plan F, without the excess charge coverage. If there’s a meaningful difference in premium between the two in your state and your doctors and hospitals take Medicare assignment, it may make sense to go that route.