The Hidden Value of High-Deductible Plan G

As Medicare agents, we all know the landscape keeps changing. Plan designs shift, benefits evolve, and client preferences follow suit. While zero-premium Medicare Advantage plans continue to dominate the conversation, a growing group of savvy seniors — and equally savvy agents — are giving High-Deductible Plan G (HDG) another look, especially when paired with a Hospital Indemnity Plan (HIP).

This approach blends cost efficiency with flexibility, giving clients nationwide provider access and predictable costs without paying for coverage they may never fully use.

Why High-Deductible Plan G Deserves Attention

For years, many clients believed the best Medicare Supplement plan was the one that paid every bill immediately. But today’s consumers are more informed and cost-conscious. They’re looking for value, not just convenience — and that’s where HDG stands out.

With High-Deductible Plan G, Medicare continues to pay its portion of approved costs — generally 80 percent for Part B services and nearly all inpatient hospital costs after the Part A deductible. The supplement then begins paying its share once the annual HDG deductible of $2,870 (2025) has been met. Because the insurer’s exposure starts later, monthly premiums are substantially lower than those of a standard Plan G, and rate adjustments often remain more moderate over time.

According to AAMSI’s 2024 Medigap Market Snapshot, enrollment in high-deductible Plan G grew by more than 14 percent year-over-year, signaling renewed interest among cost-conscious beneficiaries.

The Hospital Indemnity Advantage

A Hospital Indemnity Plan (HIP) pairs naturally with HDG, helping cover many of the upfront costs seniors worry about most. HIP pays cash benefits directly to the policyholder for covered hospital stays or procedures. Those funds can offset the HDG deductible or other incidental expenses such as travel, lodging, or household support.

“When you layer Hospital Indemnity over High-Deductible Plan G, you create one of the most balanced, predictable coverage designs in Medicare,” explains Jamie Sarno, Vice President of Medicare Supplement & Specialty Health Products at AmeriLife. “It’s a modern approach to Medigap that gives seniors control and affordability.”

HIP premiums also tend to remain comparatively stable year to year, helping clients manage total healthcare costs with fewer surprises.

When you factor in the lower, steadier premiums of HDG, it’s easy to see why this pairing appeals to financially disciplined clients who value predictability and independence.

A Balanced Perspective

Medicare Advantage remains a powerful, growing segment of the market — and for many clients, MA plans with zero premiums and built-in extras like dental or vision benefits are an excellent fit.

But for others, especially those prioritizing provider freedom, travel flexibility, or predictable cost ceilings, the combination of HDG + HIP offers a compelling and sustainable alternative.

“Medicare Advantage and Medicare Supplement plans are not competitors — they’re complementary tools,” says Kelly Hall, veteran broker and Medicare trainer. “The best agents know how to position both, helping each client find the coverage that matches their comfort zone.”

Why This Matters for Agents

Offering HDG alongside traditional MA options positions you as a true advisor — not merely an enroller. It shows clients you’re evaluating all available paths to meet their financial and lifestyle needs.

As MA plans continue to evolve with additional prior-authorization and network controls, understanding and presenting strong Medigap alternatives allows you to serve clients with greater confidence and transparency.

The Bottom Line

For seniors who value choice, stability, and peace of mind, a High-Deductible Plan G paired with a Hospital Indemnity Plan can deliver one of the most cost-effective and flexible protection strategies available today.

It’s not about replacing Medicare Advantage — it’s about broadening your toolkit to meet the diverse needs of the people you serve.

PSM Brokerage provides agents access to top-rated Medicare carriers, compliance support, and ready-to-use marketing resources to help you educate clients and grow your business with confidence.
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