2003 Medicare Modernization Act

Due to the 2003 Medicare Modernized Act, which went into effect in June 2010, there were some changes regarding the standardized Medicare Supplement Plans. These changes did not affect Medicare beneficiaries who are already enrolled in a Medigap Plan prior to that date, and only apply to people who enrolled effective June 1, 2010 and after.

Medigap Plans E, H, I and J were eliminated by Medicare; however those who are currently enrolled in these plans will be allowed to remain in them with no changes. Two benefits that were also eliminated were the At-Home Recovery benefit, as well as the Preventative Care benefit, as these were determined by Medicare to be completely under used by beneficiaries. Those who enrolled in plans prior to June 1, 2010 that contain either these benefits were allowed to continue to use them. Other important changes include the addition of Hospice benefit to all Medicare Supplement Plans, as it is now a core benefit of all Medigap Plans.

The Modernized Medicare Supplement plans also include Medicare Supplement Plan M, and Medicare Supplement Plan N. Medigap Plans M and N offer various cost sharing features that help in offering lower premiums for both, compared to plans such as Medicare Supplement Plan F and G.

Medicare's Plan M offers unique cost sharing options that are particularly attractive to Medicare beneficiaries who are relatively healthy. Plan M offers to pay 50% of the Medicare Part A deductible. For example, if you are admitted to the hospital and you have a Medigap Plan M, you would need to pay half of thedeductible. The current rules still apply to Medicare Part A deductible, in that if you are admitted and leave for 60 days or more, and then need to return within the calendar year, you must pay this deductible again.

With a Medicare Supplement Plan M, you are also responsible for paying the Medicare Part B deductible. Beyond this deductible there are no doctor's office co-pays and the 20% coinsurance will be paid by the plan.

Another plan that was introduced on June 1st, 2010 is Plan N. This plan also offers cost-sharing options to the beneficiary much like Medicare Supplement Plan M; however with Plan N they are in the form of co-pays. If you are admitted to the emergency room and have a Medicare Supplement Plan N, you are required to pay a $50 co-pay. For doctors visits there is a co-pay of up to $20 per visit, after you meet the Medicare Part B annual deductible. These co-pays allow for the premiums of Medigap Plan N to be lower than the Medicare Supplement Plans F & G. With lower premiums and cost sharing options such as co-pays and deductibles, Medicare Supplement Plan M and N should be an excellent option for people on Medicare, particularly those who do not mind payment portions of deductibles or co-pays.