What is High Deductible Plan F and how Does it Work?

A High Deductible Plan F (HDF) policy provides all the features and benefits of a standard Plan F, but at a substantially lower premium. A calendar-year deductible, set by the federal government, applies. The deductible is $2200.00 for 2017.

Under Medicare Part B, there is a $183.00 annual deductible for 2017. With a high deductible plan, you would be responsible for that annual deductible. Once that deductible has been met Medicare will begin to pay all eligible benefits under Part B. For example: After you have met the Part B deductible, Medicare will pay 80% of doctor office visits. With an HDF plan, if the doctor visit was $100.00, Medicare would pay $80.00 and you would be responsible for $20.00. This $20.00 would be applied to your deductible. If you had subsequent office visits or outpatient visits, Medicare would pay 80% and the remaining 20% would be your responsibility until the deductible is met. When the deductible has been met, then the insurance company would pay policy benefits.

Claims under Medicare Part A would be treated the same. For 2017 Medicare pays all but $1316.00 for the first 60 days of hospitalization. This amount would be put towards the deductible. If you are in the hospital more than 60 days the co-pay of $329.00 per day would be put towards the deductible until you were to reach a maximum out-of-pocket of $2200.00. When the maximum out-of-pocket has been reached, then the insurance company policy will begin to pay benefits.

What are the advantages to a High Deductible Plan F?

Lower monthly premiums. You only pay if you have claims. There is a maximum out-of-pocket of $2200.00 under the policy. At this writing, United American offers the High Deductible F for an annual premium of $384.00. Cigna offers Standard Plan f at an annual rate of $1664.28. The annual savings to go with HDF is $1280.28. The HDF plan does require some fiscal responsibility. I encourage my clients to save the difference in premium to offset the medical expenses they will incur.

If you don’t currently have a good relationship with your insurance agent, or if you are ready for an insurance re-evaluation, call Tom Ostdiek at Ostdiek Group, Inc. 630-834-0125.


What are the differences between regular “Plan F” and “High Deductible Plan F”?

Photo credit: Getty Images/Tom Merton