Figuring out Medicare Supplement insurance can be like solving a puzzle. There are many parts, and they all need to fit together just right. You’re probably wondering about your options, how much they cost, and what they really cover. This is especially true with Medicare Supplement Plan L because you want to ensure you’re getting the best deal without skimping on essential coverage.
Let’s break down the pieces and get a clearer picture of what Medicare Supplement Plan L offers. This way, you can see if it’s the right fit for your individual needs and what Plan L covers.
Table of Contents:
- What is Medicare Supplement Plan L?
- Medicare Supplement Plan L Out-of-Pocket Limit
- Who Is Plan L a Good Option For?
- Conclusion
What is Medicare Supplement Plan L?
Medicare Supplement Plan L is one of the ten Medigap plans offered by private insurance companies. Medigap plans, also known as Medicare Supplement Plans, are designed to fill in the “gaps” in Original Medicare (Parts A and B), like copayments, coinsurance, and deductibles.
In simpler terms, Medigap helps you pay for some of the healthcare expenses that Original Medicare doesn’t cover completely. This can save you a lot of money in the long run, especially if you require frequent medical attention. Medicare Supplement Plan L is a Medicare Supplement insurance plan with an annual out-of-pocket limit.
What Does Medigap Plan L Cover?
Medicare Supplement Plan L covers many of the out-of-pocket costs associated with Original Medicare. Let’s explore what Medigap Plan L has to offer:
- Part A coinsurance and hospital costs (up to an additional 365 days after Medicare benefits run out): Plan L covers 100% of these costs. That means you won’t have any expenses for hospital stays even after your regular Medicare benefits are used up for the year.
- Part A deductible: Plan L covers 75% of your Part A deductible. In 2024, the Part A deductible is $1,600, so with Plan L you’d only pay $400. https://www.medicare.gov/basics/costs/medicare-costs
- Part A hospice care coinsurance or copayment: This is covered at 75% with Plan L. This benefit can make a big difference in managing costs if you require hospice care.
- Blood (first 3 pints): Plan L pays for 75% of the first 3 pints of blood needed for a medical procedure. After that, Plan L covers 100% of blood costs.
- Skilled nursing facility care coinsurance: You get 75% coverage with Plan L, meaning you are only responsible for 25% of the coinsurance charges.
- Part B coinsurance or copayment: Medicare Supplement Plan L covers 75% of your Part B coinsurance or copayments. Original Medicare typically covers 80% of these costs, leaving you to pay the remaining 20%. Plan L picks up three-quarters of that 20%. This helps significantly in lowering your expenses for doctor’s visits, outpatient services, and medical equipment.
As you can see, Medicare Supplement Plan L provides fairly comprehensive coverage. However, like all plans, there are a few things it does not cover. You’ll need to plan accordingly for these expenses.
What Medigap Plan L Doesn’t Cover
Although Plan L offers substantial protection, here are a few things you should be aware of:
- Part B Deductible: You’re responsible for 100% of the Part B deductible, which is $226 in 2024.
- Part B Excess Charges: These are additional fees that some doctors charge above the approved Medicare amount. Medicare Supplement insurance plans like Plan F and Plan G cover excess charges, but Plan L does not.
- Foreign Travel Exchange: Medicare doesn’t generally cover healthcare costs outside the United States, and Plan L won’t cover them either. If you travel internationally, you might want to look into supplemental foreign travel emergency insurance.
- Prescription Drugs: Plan L doesn’t include coverage for outpatient prescription drugs. For that, you’d need to enroll in a stand-alone Medicare Part D plan to handle prescription drug expenses. It’s a common choice for Medigap users as it complements the overall coverage.
- Dental, Vision, and Hearing: Original Medicare doesn’t cover routine dental, vision, or hearing care. And neither does Medigap Plan L. Some private insurance plans can help you with those costs though.
Medicare Supplement Plan L Out-of-Pocket Limit
One big reason people choose Medicare Supplement Plan L is its yearly cap on out-of-pocket expenses. This limit can give you peace of mind when thinking about healthcare costs.
Once you’ve paid your Part B deductible and met your out-of-pocket limit, Medicare Supplement Plan L picks up 100% of covered expenses for the remainder of the calendar year. This can be a lifesaver for individuals dealing with chronic health issues that could lead to unexpected costs. In 2024, that out-of-pocket limit is $3,530. https://www.cms.gov/Medicare/Health-Plans/Medigap/KandL
Comparing Medicare Supplement Plan L with Other Plans
With ten Medigap options to choose from, how do you know which plan suits your needs? Well, that depends on what’s most important to you: high monthly premiums with lower out-of-pocket costs, or vice versa. Understanding this can help you make the best decision for your personal healthcare budget. Here’s how Plan L stacks up:
| Medicare Supplement Plan | Pros | Cons |
|---|---|---|
| Medigap Plan A and Medigap Plan B | Lower premiums. Good for those in good health who want basic coverage. | Covers fewer gaps in Original Medicare. Doesn’t cover the Part B deductible. |
| Medicare Plan N vs Plan G | Robust coverage similar to Plan F. Lower premiums. | Excludes the Part B deductible and excess charges. |
| Medicare Plan N | Pays 100% of most covered services. Lower monthly premiums. | Requires copays for some office and emergency room visits. |
| Cheap Medicare Supplements | Offers the lowest premiums. Good for those who want to pay the lowest monthly cost and are okay with less robust coverage. | Plans K and L cover a percentage of Medicare costs, not 100% like other plans. |
Comparing Medicare Supplement Plans can be time-consuming. Be sure to visit Medicare.gov to learn about How to compare Medigap policies. This resource provides detailed breakdowns of each plan and the benefits they offer.
How Much Does Plan L Cost?
The price of Medicare Supplement Plan L varies depending on several factors, such as:
- Age: Generally, older individuals pay higher premiums because, statistically, they tend to utilize healthcare more often. However, pricing structures and methodologies vary depending on your state. Some states utilize “attained-age” pricing, while others utilize community-rated pricing methodologies. Attained-age pricing structures calculate the premium you will pay based on the current age you are turning when seeking to enroll in a Medicare Supplement. These plans see premium adjustments on a yearly basis thereafter based on attained-age. Community-rated, by contrast, uses average health factors for the local geographic region for all individuals, so someone enrolling at age 65 will generally pay the same premium as someone enrolling at age 75 if both reside in the same local rating region. Community-rated plans typically come with higher premium rates at initial purchase because premiums do not adjust annually to match increasing age (and healthcare utilization). Be sure to shop around, gather quotes from multiple carriers, and use Medicare.gov to make comparisons during the annual open enrollment period.
- Gender: Premiums for women tend to be slightly higher than those for men because they tend to live longer and utilize more health services. Health insurance carriers attempt to price risk (in aggregate, by demographic) to anticipate aggregate claim payments for each demographic.
- Location: Insurance rates vary from state to state. Urban locations, where costs of living and delivering health services are typically higher, can also contribute to increased premiums for health plans in those local geographic areas. It’s helpful to work with an independent agent who can show you plans offered in your zip code.
- Tobacco Use: Some insurance companies charge smokers more for Medigap coverage.
- Insurance Company: Different insurance companies price their plans differently. That’s why it’s so important to compare plans from different companies before deciding on the best Medicare Supplement insurance option for you. https://medicarewire.com/blog/what-is-the-average-cost-of-supplemental-insurance-for-medicare/
- Underwriting and Medical History: Because there are underwriting considerations (aka health history) that go into a carrier’s assessment of insurability (your risk profile), this could affect if you can enroll. When you first enroll in Medicare Part B (regardless of age), you will qualify for Medicare Supplement guaranteed issue. This allows you to purchase a Medigap policy without any underwriting (no declinations due to health history), so all applicants during their individual initial open enrollment period will be accepted at standard rates. Carriers do assess smoking status for new enrollees though. But after this period, you could be declined or subject to a rate-up due to a negative health event or diagnosis.
Who Is Plan L a Good Option For?
While any Medigap plan is better than none, Plan L is particularly good for people who:
- Want Predictable Healthcare Costs: The out-of-pocket limit is attractive if you’re on a fixed income or want to budget your health spending effectively.
- Have a Chronic Condition: Knowing your maximum financial exposure can bring peace of mind if you manage a health condition.
- Don’t Mind Some Cost-Sharing: Because it doesn’t cover 100% of every cost, those who don’t expect extensive healthcare usage and who want to balance out their premium with coverage benefits find Plan L attractive.
A Real-Life Scenario
Consider Sarah, a 68-year-old with high blood pressure and diabetes. She wants a Medigap plan to reduce her out-of-pocket healthcare expenses, but premiums for some of the more comprehensive plans seem pricey.
Sarah is actively managing her health with regular doctor visits and is looking for a plan with lower premiums while still providing financial protection if a serious medical situation occurs. For Sarah, Plan L might be a suitable solution. Its out-of-pocket maximum provides peace of mind.
It’ll ensure Sarah isn’t stuck with huge bills if an unforeseen health issue requires expensive treatment. This allows Sarah to stay within a set budget without compromising crucial healthcare protection.
Conclusion
Medicare Supplement Plan L can be a valuable option to help control healthcare costs without breaking the bank. With its yearly out-of-pocket maximum and good mix of benefits, it helps manage uncertainty while covering significant expenses associated with Original Medicare.
Weighing its advantages against what it doesn’t cover will guide you to the right decision. Consider your healthcare needs, financial situation, and the coverage level of Medicare Supplement Plan L when deciding if this option suits you.