Congress limits insurance for Medicare deductibles

Medicare beneficiaries often buy “Medigap” insurance policies that pay for many of regular Medicare’s deductibles and copayments. But as a result of a new law passed by Congress, starting in 2020 Medigap plans will no longer be allowed to offer coverage of the Medicare Part B deductible, which is currently $147.

However, current Medigap policyholders and those buying policies before 2020 will still be eligible for the deductible coverage after that date, so this is something to keep in mind.

The idea behind making Medicare beneficiaries pay the deductible themselves is that it will cause them to think twice before going to a doctor – which might result in Medicare making unnecessary payments.

But critics of the law argue that if the change prompts beneficiaries to forego needed medical care, they might well require more expensive care later, which would cost Medicare more in the long run.

The change might encourage more seniors to join Medicare Advantage plans, which will still be able to cover the deductible.

In addition to the Medigap change, the new law will make affluent seniors pay higher Part B premiums. Starting in 2018, individuals with incomes between $133,500 and $214,000 (and couples with incomes between $167,000 and $428,000) will pay more. And the regular Part B premium will rise faster than it would have otherwise.