Medicare Supplement Plan M emerged as a result of the Medicare Modernization Act, introducing a fresh array of Supplements. This plan made its debut in the summer of 2010 within the Medicare insurance market. Although occasionally referred to as Medicare Part M or Medigap Part M, it is important to note that the accurate terminology is Plan M.
Medicare Plan M offers the same fundamental benefits as other Supplements, but with a slightly lower monthly premium. In return, you are required to pay half of your hospital deductible and the entire annual outpatient deductible. By sharing in these deductibles and excess charges, you can enjoy the advantage of reduced premiums. For individuals who do not anticipate frequent hospital visits and are comfortable with occasional cost-sharing, Plan M may be a suitable option. However, it is crucial to seek assistance from a licensed agent who specializes in Medicare Supplements. They will assess the variations in premiums and ensure that the potential savings outweigh the potential expenses.
Plan M Example :
Mr. Mike has opted for Medigap Plan M to ensure comprehensive coverage. He anticipates significant savings on his premiums, which are a major advantage. Additionally, he has set aside a substantial amount of money to cover the 50% co-insurance on the Part A deductible that may arise occasionally.
After a few years, Mr. Mike finds himrself in need of knee surgery, which necessitates an overnight hospital stay. As per his policy, he will be responsible for paying his share of the Part A deductible.
Fortunately, Plan M also provides coverage for most of his outpatient follow-ups. However, he will first need to pay the annual Part B outpatient deductible. Once this deductible is met, Medicare will cover 80% of his outpatient care, while his Medicare Supplement Plan M will take care of the remaining 20%. In the event that his knee surgeon does not accept Medicare’s assigned rates, Mr. Mike may also have to pay the Part B excess charge. However, this excess charge is limited to 15% above the doctor’s allowable fee set by Medicare. Consequently, the potential cost sharing on excess charges is minimal, providing Mr. Mike with a sense of comfort and security.
Takeaways
Plan M provides more affordable monthly premiums in exchange for slightly lower benefits when compared to certain other supplement plans. With Plan M, you are responsible for covering 50% of your Part A hospital deductible, the Part B deductible, as well as any excess charges. Plan M is not as commonly available as other supplement plans. For individuals seeking to reduce costs on premiums and maintain a solid financial cushion, Plan M could be a suitable option.
Mario Arce
I have been working with Medicare clients since 2016. I serve California members in San Bernardino & Riverside county.
