How do Insurance Premium Payments Work for Medicare Supplemental Plans (F, G, N)?

Choosing a Medigap plan (F, G, or N) to supplement your original Medicare plan (Part A and B) can provide peace of mind regarding out-of-pocket healthcare costs. However, understanding your plan’s billing can sometimes feel confusing.

Below, we will clarify some common billing questions for Medigap plans F, G, and N.

What Is the Difference Between Medicare Supplement Plans F, G, & N?

There are ten Medicare Supplement plans (Medigap plans) that are generally offered in most states. These plans are the same across all states; the only difference is the premium and provider. 

The most popular plans are F, G, and N, which account for 55, 33, and 25 percent of enrollees by last year’s numbers, respectively. These plans are the most popular due to their comprehensive coverage.

Plan F was discontinued in January 2020 and is only available to those grandfathered into it. It has the highest premium rate because it covers the Part B deductible (doctor visits). 

Plan G offers more coverage than Plan N, and consequently, its rates are higher. Plan G covers copayments, and Plan N does not. 

Plan N has the least expensive premium rate of the three because it does not cover copayments, the Part B deductible, and sometimes Part B excess charges. Plan F covers all of those, and Plan G covers the copayments. 

Terminology Used on Your Medicare Supplemental Plan Invoices

Once you’ve chosen a Medicare Supplement plan, you might encounter unfamiliar terms on your invoices. Here’s a breakdown of common Medicare Supplement plan terminology:

• Policyholder: The person enrolled in the health insurance plan.
• Subscriber: Another term for the policyholder, especially if they have a family plan and cover dependents.
• Member: Similar to subscriber, referring to someone covered under the health insurance plan.
• Provider: The doctor, hospital, or other healthcare facility that provides the medical service.
• Date of Service (DOS): The date the medical service was provided.
• Procedure Code: A unique code that identifies the specific medical service performed (e.g., X-ray, office visit, surgery).
• Diagnosis Code: A code used to identify the medical condition the service was intended to diagnose or treat.
• Allowed Amount: The maximum amount your insurance company will reimburse the provider for a specific service. This amount is often negotiated between the insurer and the provider network.
• Covered Charge: The portion of the provider’s charge that your insurance company agrees to pay after applying any discounts or adjustments.
• Copay: A fixed dollar amount you pay for a covered service, typically due at the time of service.
• Coinsurance: A percentage of the allowed amount that you are responsible for paying after you meet your deductible. A 20 percent coinsurance means that you will pay 20 percent of the bill, and insurance will pay 80 percent of the bill after the deductible is met. 
• Deductible: The annual amount you must pay out-of-pocket for covered services before your insurance starts sharing the costs.

 

Billing Specific Terms:

• Balance Billing: When a provider bills you for the difference between their charges and the allowed amount determined by your insurance. This can occur if you go to an out-of-network provider or if your plan has no balance billing protection.
• Explanation of Benefits (EOB): A document from your insurance company that explains the details of a covered service, including the allowed amount, your copay or coinsurance responsibility, and the amount the plan paid to the provider.
• Denial of Coverage: When your insurance company refuses to pay for a service because it deems it medically unnecessary, not covered by your plan, or requires pre-authorization that wasn’t obtained.

Common Medicare Supplemental Plan Billing Questions

Here, we answer some of the most frequently asked questions about supplemental plan premium billing:

1. When Is the First Supplemental Plan Premium Payment Deducted from My Bank Account?

The first payment usually occurs seven to 21 days after you first enroll so that there is time to process the enrollment and mail out the insurance cards. This first payment covers your first month’s premium charge. The next charge will cover the next month. 

 

Note: If an AARP / UHC plan covers you, you will not be billed before your effective start date. The payment is generally on the 5th of each month, beginning on the month your coverage goes into effect. 

2. How Do I Change My Automatic Bank Payment Information?

Use the customer service 800 number printed on your supplemental plan insurance card to call customer service. They will take your new bank information and update your payment information directly over the phone. 

If you cannot find your card, you will need to get a replacement supplemental insurance card. 

3. How Do I Change Which Day of the Month My Premiums Are Deducted?

To change which day of the month your premium payments are deducted, call the customer service 800 number on your supplemental plan insurance card. The customer service team will change what day the bank draft occurs. 

4. Why Is My Supplemental Plan Premium Bill Higher Than Expected?

A higher bill than expected is usually due to one of two reasons:

1. The first month’s premium is combined with the initial policy application fee, which is usually around $20 to $25. The fee is paid to the insurance company to process the application. There is nothing that can be done to eliminate this cost. 
2. You were quoted a multi-policy discount that isn’t reflected in your premium amount. If this is the case, note that the discount will not be applied until both you and your spouse’s plans have gone into effect. Please contact us if both plans are in effect and your premium still doesn’t reflect the correct amount, and we will help you resolve the issue.

5. What Happens If I Am Late Paying My Premium?

Late payments usually result in late fees that can add up quickly. Neglecting to pay premiums altogether can result in a lapse of coverage, which means the insurance company would stop paying for your covered expenses. 

To reinstate your coverage after a lapse, you may need to pay any outstanding premiums and penalties. Contact your provider if you are notified about late payments or a lapse in coverage. 

Consider enrolling in automatic premium payments to avoid late fees and stay on top of payments. 

6. How Do I Dispute a Medicare Supplemental Plan Billing Error?

If you believe your bill is incorrect, take the following steps to dispute the error with your Supplemental plan provider:

• Gather Information: Collect any documents that might support your claim, such as copies of your Medigap plan documents, Explanation of Benefits, receipts or invoices, and any prior communications you’ve had with your provider regarding the disputed amount. 
• Contact Your Insurance Company: Call your Medigap insurance company’s customer service department and explain the error in detail. Be clear and concise. Give them the invoice ID number, and specifically reference the line items on your bill that you believe to be incorrect. 
• Request a Written Response: Once you’ve explained the error, if they cannot resolve the issue at that time, ask for a written response outlining their investigation and resolution. This written document will serve as a record of your communication and their decision.
• Appeal the Decision (if necessary): If they deny your claim or their error and you are unsatisfied with their resolution, you can appeal their decision. Most Medigap plans have a formal appeals process. Refer to your plan documentation for details on initiating an appeal. 
• File a Complaint with Medicare (if necessary): If you have exhausted your options with the appeals process and are still unsatisfied with the outcome, you can file a complaint with Medicare. Medicare can investigate the issue and mediate between you and your plan provider. You can file a Medicare complaint online or call 1-800-MEDICARE.

Get Help with Your Supplemental Plan from Medicare School

Looking for additional help navigating your Medicare Supplemental Plan bill? Contact  Medicare School for individualized assistance. Don’t forget to also check out our resources on Supplemental Plans and our blog to help you choose the right Supplemental Plan for your needs and budget.