The Misconception of Plan N: Debunking the Myth of Excess Charges

In my discussions with fellow insurance agents, a common concern frequently arises: the reluctance to offer Plan N due to fears of excess charges potentially costing clients "hundreds of dollars." However, upon closer examination, this fear appears to be more of an industry myth rather than a substantiated reality. Let me break down a great article I read this morning from Mike Gattorna where he broke down the urban legend a bit with some interesting industry facts and figures.

Fact vs. Fiction: The Reality of Excess Charges

Let’s look at the facts. In 2016, one of the largest insurance carriers reported that 99.34% of claims did not incur any excess charges. For the remaining 0.66% of claims that did, the average excess charge was less than $20. This data alone contradicts the notion of exorbitant excess charges.

Further reinforcing this, a 2023 report by the Medicare Payment Advisory Committee (MedPAC) revealed that only 2% of providers were eligible to charge excess fees. Among this small percentage, over 40% were within the mental health industry, meaning that the likelihood of encountering excess charges in general medical care is even lower.

Putting the Risk in Perspective

To put it simply, clients have less than a 1% chance of receiving an excess charge, and if they do, the average cost is under $20. This minimal risk hardly justifies not offering Plan N. As Mike indicated, "if we applied this logic to other areas of life, it would be akin to advising clients to walk everywhere due to the potential risk of their car breaking down, which could be far more costly." As comedian Steven Wright humorously remarked, "Everywhere is walking distance if you have the time."

Transparency and Discretion in Billing

Moreover, providers are required to disclose any potential excess charges before performing services, and they have the discretion to bill or waive these charges on a case-by-case basis. This transparency and flexibility further mitigate the risk for clients.

?Encouraging Agents to Reconsider Plan N

Given these facts, it's time to reconsider the value of Plan N. Agents should revisit their Medicare Supplement charts and confidently discuss Plan N with their clients. By doing so, they can offer a cost-effective and reliable option that is supported by data, not overshadowed by unfounded fears.

In addition, Humana's Plan N offers a compelling alternative that insurance agents and brokers should thoroughly evaluate. With up to a 12% household discount, no application fee, the ability to pay via credit card and an easy security code text signature on our eHub enrollment platform we make it easy for you and your client. In addition, our current broker incentive of $300 for the placement of any Plan N business helps rewards you for taking the time to fully explain the benefits of a Plan N Medicare Supplement Policy.

In conclusion, it’s essential to base our recommendations on facts rather than myths. With minimal risk and significant benefits, Plan N deserves a place in the conversation. Let's move past the misconceptions and provide our clients with the best possible advice.