Category: Medicare Drug Plan

“Broadway Joe” Namath Isn’t Giving You the Whole Story

Posted on November 15, 2022 by - Medicare, Medicare Advantage, Medicare Annual Enrollment, Medicare Drug Plan, Medicare Supplement

“Broadway Joe” Namath Isn’t Giving You the Whole Story

By:  Dan Hoelscher, President & Founder, Seniormark, LLC

 

If you haven’t already had enough of the Celebrity-Sponsored Medicare Commercials, then buckle up!  With the Medicare Annual Enrollment (AEP) season quickly approaching, you are soon to be inundated with them.  They will feature celebrities such as NFL great Joe Namath, Good Times Jimmy Walker and Ernie Hudson of Ghostbusters fame.  They are obviously effective!   Since Joe Namath became the spokesman for the Medicare Coverage Hotline. we have had more calls regarding Medicare Advantage plans than ever before.  Joe encourages you to not miss out on “New Medicare Benefits” and to make sure you get the “Medicare Benefits You Deserve.”

Benefits such as:

  • Rides to Medicare Appointments
  • Private Home Aides
  • Doctor’s and Nurse’s visits by telephone
  • Home delivered meals
  • Dental, Vision, Hearing and Prescription Drug Coverage

 

Some even offer a premium credit to your social security check for your Part B Medicare premium.  I spent some time recently watching numerous such commercials.  And what the commercials said was true, to the extent that it was said.  However, what is left unsaid is what is most crucial for you to make a wise decision.

 

There are a couple of things you need to consider before you race to your phone to “Call Now.” First, Joe Namath, while he may be a perfectly upstanding gentleman, is no Medicare expert.  He is a paid endorser.  In fact, I doubt he even understands what a Medicare Advantage plan is.  Even if he is on a Medicare Advantage plan, I doubt he is concerned with the potential out of pocket costs involved.  I believe his $25 million net worth may place him a little out of touch with the average American budget. Second, be aware that he is speaking on behalf of the Medicare Coverage Hotline, not Medicare.  And if you were to pause the commercial on the last slide, you would see that The Medicare Coverage Hotline is a for-profit lead generation campaign.  This means that they are simply trying to get you to call their 800 number so they can sell you as a lead to an insurance agent.

 

At Seniormark, we can help you with both Medicare Supplement and Medicare Advantage plans.  And we want you to choose your coverage based on the plan you believe it right for you, based on all the information, not just the information a salesperson wants you to hear.  You deserve a fair comparison!

 

Call our office at 937-492-8800 to see what plans might work best for you!

Annual Enrollment Period (AEP) To-Do List

Posted on November 1, 2022 by - Medicare, Medicare Advantage, Medicare Annual Enrollment, Medicare Drug Plan, Medicare Supplement

  1. Write the important Annual Enrollment dates to remember on your Calendar, and clip your calendar on your fridge.
  2. Don’t eat that midnight snack until you’ve read the dates at least once.
    1. October 1st— we can talk about your options!
    2. October 15th— The AEP games begins.
    3. December 7th—AEP comes to exhausting close.
    4. January 1st— Plan changes go into effect.
  3. Compare your medications to the formulary (drug list) mailed to you by your drug plan company.
  4. Consider changing your drug plan if some of your medications are no longer covered or if the premium is too high (call OSHIIP at 800-686-1578 to reshop your plan).
  5. Call us and set up an appointment to have a good chat about your Advantage plan.
    • Consider switching Advantage Plans if:
    • Your hospital or doctor went out-of-network
    • Plan changes for the following year result in jaw-dropping out-of-pocket spending or a high premium.
    • Your medications are no longer covered or are costing a lot.
    • Your Advantage plan is (all around) a bit of a drag.

6.  Remember — you can change your Medicare Supplement any day of the year.  If you currently have a supplement, you are not bound by AEP in order to switch companies.  However, if you want to switch from a Medicare Supplement to a Medicare Advantage plan or if you want to switch from a Medicare Advantage plan to a Medicare Supplement, you must do that during this time.

7.  As a golden rule, your ultimate to-do list item is …plan ahead!

Still confused about what to do?  Give our office a call at 937-492-8800, find us on Facebook at www.facebook.com/seniormark or fill out the contact page and we will be in touch:  https://seniormark.com/contact/.   We are here to help!

Will I Be Able to Afford Medicare?

Posted on June 11, 2020 by - Medicare, Medicare Advantage, Medicare Drug Plan, Medicare Supplement, Medicare Workshop, Retirement Planning

Will I Be Able to Afford Medicare?

The shortest and most honest answer is “I don’t know”. But I know this doesn’t help you answer the most pressing questions weighing on your mind as you approach retirement age. Am I ready? Or Should I delay my retirement? And most of all—how am I going to afford health care without my employer insurance?

 

So here’s what I am going to do. Using my 20+ years of experience working with retirees, I am going to lay out a framework for what to expect when it comes to Medicare expenses. These will just be “in-the-ballpark” figures, but I believe they will help you come to a decision. You just might find that Medicare falls squarely into your budget.

 

So let’s get started with some good news.

 

Medicare Part A (Inpatient Care) Is Free

As long as you’ve paid into Social Security for at least 10 years, social security will return the favor with no associated Part A premium.

 

The Associated Part B (Outpatient Care) Monthly Premium is $134.00

This figure is adjusted for high income, but most people don’t fall into the high-income category. $144.60 will be your monthly premium unless you make $87,000 per year or more as an individual or $174,000 filing jointly.

 

From this point, the cost of Medicare is heavily affected by which path you take. You can boil down all the madness into two basic choices: Medicare Advantage or Original (traditional) Medicare.

 

The Traditional Medicare Route

If you choose the Traditional Medicare route, you will want Medicare Supplement Insurance to fill in the gaps of what Medicare doesn’t cover. Otherwise, there will be no limit to your out-of-pocket spending. The premiums for a Medicare Supplement range from $45-146 per month. However, we often recommend a plan G, which typically costs $110 per month. This is a fairly standard premium. It puts into perspective what you can expect a Medicare Supplement Plan to cost.

 

To cover your medications, you will also need a Part D prescription drug plan, which will cost in additional premium anywhere between $14 to $128 monthly. The average cost for a drug plan is $42 in 2020. The out-of-pocket costs associated with Part D vary greatly depending on your medications. It is impossible to estimate without knowing your specific situation.

 

The Medicare Advantage Route

Offered as an alternative to Traditional Medicare, Medicare Advantage is often the cheaper option when it comes to premiums. They are offered for prices within the range of $0-163 monthly with the average premium being approximately $23 per month. The Part D prescription drug plan is almost always rolled into the plan.

 

Caution: Check For Possible Out-of-pocket Costs

At first glance, it looks like the Medicare Advantage route is the obvious choice. But this fails to take into account the risk of out-of-pocket costs. With a Medicare Supplement (only available with Original Medicare), the maximum out-of-pocket (for Medicare approved expenses) is only $198 annually for Plan G. However, in an advantage plan, it is more of a pay-as-you-go approach. There are less monthly premiums; but copays, coinsurance, and deductibles are much higher. The potential out-of-pocket for an advantage plan can be as a high as $3500-6000 per year or more!

 

The Costs At a Glance


So there you have it! This should give you a good idea of what Medicare costs for the average 65-year old. But—as I said before—the cost of Medicare is different for every person. If you are still concerned about being able to afford Medicare, contact us for a free consultation. We will assess your financial and health situation to find an overall plan that meets your needs, concerns, and pocketbook. Ensuring you a successful and secure transition into retirement is our number one priority.

 

There are a lot circumstances that may prevent you from retiring. But I believe that the affordability of health insurance shouldn’t be one.

 

Disclaimer: Numbers are based on Ohio 45365.

 

Turning 65 soon and not sure what to do?  Our next workshop is quickly approaching on June 25.  Click here to sign up for our free Medicare workshop. No high-pressure sales pitches here, just in-depth discussion about the ins and outs of Medicare!

Do I Need To Do Anything To Enroll in Medicare?

Posted on April 23, 2020 by - Medicare, Medicare Advantage, Medicare Drug Plan, Medicare Supplement, Retirement Planning

Do I Need To Do Anything To Enroll in Medicare?

This is a question I get quite frequently at my offices in Sidney and Vandalia, Ohio. When it comes to Medicare, soon-to-be retirees know that they’ve been paying for it since they started working through Social Security. However, they often don’t know how they collect the benefit they’ve worked so hard to earn.

 

Does it just happen automatically? Or do soon-to-be retirees like you need to do something?

 

Well, that depends on one thing…

 

Are You Already Receiving Your Social Security Benefit?

If you decided to claim your Social Security benefit before 65, then you don’t have to sign up. Your Medicare card will arrive in the mail around your 65th birthday and you will be automatically signed up for Medicare Parts A and B.

 

If Not, Make Sure You Sign Up!

But if you are not receiving your Social Security benefit, you need to sign up during your open enrollment period, the seven-month period surrounding your 65th birthday. You will be doing yourself a big favor by signing up on time because there are many late enrollment fees. For example, the Part B penalty is 10% for every year you are late. Unfortunately, this penalty will continue for the rest of your life.

 

So take the time amidst retirement planning and birthday celebrations to sign up. You can sign up online at ssa.gov or you can call or stop by your local Social Security office. If you live near Sidney, that office is in Piqua, 227 Looney Rd.  If you live somewhere else in Ohio, find your closest location here:  Ohio Social Security office locations.

 

Everyone’s Got a Lot More to Consider!

But whether or not you have to sign up for Medicare, you are far from done. It is a big misconception (see our blog on this here) to think that original Medicare alone is enough to cover all your health care expenses. There are two things you should do. Firstly, it is almost always a good idea to pick up a stand-alone prescription drug plan through Part D of Medicare. Otherwise, you will have no coverage for your medications. In addition, I also recommend finding some way to supplement Medicare with additional insurance. You can get a Medicare Supplement plan, or—for those who are more cost-conscious—a low to no cost Advantage plan.

 

As you can see, even though you may not have to do anything to sign up for Medicare, signing up is just the first step before you have your health insurance in order. I recommend seeing an advisor to help guide you through this complex process.

 

Need help navigating Medicare? Want personal help to find a plan that is right for your needs and pocketbook? Call Seniormark at 937-492-8800 for a free consultation!

 

3 Reasons Why Prescription Drugs Are So Expensive

Posted on March 12, 2020 by - Health and wellbeing, Medicare, Medicare Drug Plan

 3 Reasons Why Prescription Drugs Are So Expensive

It is no secret that prescription drugs are outrageously expensive. After nineteen years of working with those transitioning into retirement and helping retirees shop Part D Drug Plans, I have come across some astronomic prices. To give you an idea, some of the prescriptions (without insurance, thank goodness) range from $40,000 per year all the way to $158,000 per year. And what’s more, the prescription that cost $158,000 was simply a small, white pill that my client took once a day. If you break that down to price per pill, the cost is $439 per pop. Talk about over-the-top!

 

The scary part is, I know this is a widespread issue. Its effects extend to burden millions of older and younger folks beyond my small office in Sidney, Ohio. I’m not naïve enough to believe that what I have witnessed is unique.

 

This raises the question: why? Are drug companies “getting away with murder” as Donald Trump proposed on his campaign trail? Is it a governmental failure to regulate a monstrous and out-of-control industry? Or are their prices ultimately justified? Well, I did a little digging, and it seems the general consensus centers around three main reasons:

 

Reason#1: The 20-Year Monopoly

If any of you have ever played the famous Parker Brother board game, you know that the game is over once one player has control of the board. It is the same with the drug industry, except their monopoly is not won through rolling doubles and buying properties, but by acquiring patents. Once a pharmaceutical company turns out a new drug, their patent grants them exclusive rights to the formula for 20 years. This prevents any generic drugs from being manufactured to provide competition. And no competition means unlimited control over price. Normally this excessive control wouldn’t be the case, but prescription drugs are not like new sneakers or television sets. Those who need them can’t live without them, and are, quite often, willing to pay anything to get them.

 

This wouldn’t be so bad if it were just for those first twenty years. After all, the pharmaceutical company does need some time to make profit back after dumping loads of resources into research and development to turn out the new drug. However, the companies often push their monopoly past the 20 years by changing their formula just enough to renew their patent. At that point, the monopoly can become a bit oppressive.

 

Reason #2: Can’t We Talk About This?

Many other countries negotiate heavily with drug companies to keep prices low. But the United States does not allow this. Medicare is not allowed to talk the price down, and others who might have a voice are silenced by the almighty dollar. Essentially, drug companies have full reign over what they charge for their prescriptions.

 

Imagine how much the United States could save if they allowed Medicare to have a say.  According to the Economist, Medicare is the drug companies’ “single biggest customer,” forking over $112 billion to purchase prescription medications for retirees. If they could use this buying power as leverage, AARP says that Medicare could save $16 billion annually. Then they could pass those savings over to you in the form of lower Part D premiums and fees.

 

Unfortunately, this is not the case as of now. Now, Medicare has to cover almost all drugs approved by the FDA, AARP says, “regardless of whether a cheaper, equally effective drug is available.”

 

Reason #3: Lack of Transparency in Drug Pricing

It is difficult to tell how much a drug is actually worth. Drug companies claim that research and development costs justify the high prices, but it is unclear as to how accurate this really is. Some sources, like Money Magazine dispute this explanation, citing that only 10-20% of revenue really goes to research and development.  Others, like AARP, point out that “9 out of 10 big pharmaceutical companies spend more on marketing than on research,” a statistic which shows a lot about where their priorities lie. And this all goes without saying that drug companies are rarely hurting for money anyhow. In recent years, it has proved to be a very lucrative industry.

 

Overall, it seems that drug companies have too much power in the United States economy. The question then turns to how can we lessen that power to make it fair for everyone involved without lessening the incentive for innovation. Because $439 for each measly pill is too much. I think everyone besides the drug companies can agree on that.

 

Until these issues are tackled, just do what is within your power. If you are approaching 65, get yourself on a Part D drug plan for your unique needs and situation.   Remember, at any given time there are 20+ drug plans to choose from, so don’t let company names drive you to the wrong plan.  Each person’s recommended drug plan is different based on their prescriptions.  Make sure and shop your drug plans!

Is a Part D Drug Plan Really Worth it?

Posted on October 10, 2019 by - Medicare, Medicare Drug Plan

Is a Part D Drug Plan Really Worth it?

I’m healthy. I’m fit. I still run 5Ks and mulch my own flowerbeds and trim my own bushes. It’s like I’m Tom Cruise or something. Or Brad Pitt. Or a 1989 bottle of Chardonnay. Just getting better with age.

 

At this point during your internal monologue, you might be wondering if a drug plan is really worth it. If you’re really at the top of your game, taking little to no medication, why would you want a $20-30 monthly premium weighing you down? Well, to cut right to the chase…

I’ve got three top-notch reasons for you:

Medicare Will Penalize You For Not Having a Drug Plan

Yup. You read that right. If you join Part D too late, it could cost you big time. In fact, for every month you are late (after your initial enrollment period), your premium will go up by 1% of the national average drug plan cost in the U.S, a penalty which continues for the rest of  your life. Of course, if  you never go on a drug plan, the late enrollment penalty doesn’t apply. But can you guarantee that? What happens if your doctor puts you on a medication that is  out-of-this world-expensive? How will you pay for it?

Which brings me to my next reason…

The Cost of Medication is Outrageous

Right now, you might be able to get your drugs at Walmart Pharmacy for less than $4 a month. But—as I just said—life offers no guarantee for this to continue.

We’ve seen people come into our office who are on prescription drugs which cost from 40k a year all the way up to $150,000 a year. Now these people were on the right drug plan for their needs (sigh of relief), but what if they weren’t? Could they have just signed up right then and there?

Actually no, because…

You Have To Sign Up During Specific Enrollment Periods

If you miss your Initial Enrollment Period (the 7 month window starting 3 months before your 65th birthday month), you have to wait until the Annual Enrollment Period to sign up. The Annual Enrollment Period goes from October 15- December 7. It is the only time you can enroll. And the enrollment doesn’t go into effect until January 1st.

So what if you get put on this previously mentioned out-of-this-world expensive drug mid-year? And you realize you need drug coverage? It isn’t convenient, but the truth is you may have to rack up penalties and pay the high medication costs until January 1st. Talk about being weighed down!

So…

As you review your most recent purchases, you can probably question the worth of a lot of things you bought. That life insurance policy for your gerbil? Probably not your best decision. The 3 year subscription to Fruit of the Month Magazine? I would’ve passed. A blanket with sleeves? Please.

And if you never get sick, you can throw prescription drug plans in with the lot. But herein lies the problem: no matter how strong or fit or Brad Pitt-esque you might be, health is often unpredictable.

Need more information on how to choose a drug plan? Check out this post to get you started!

Still have questions?  Give our office a call and we will do what we can to help you out!  937-492-8800

3 Reasons to Start Medicare Planning NOW!

Posted on August 29, 2019 by - Medicare, Medicare Advantage, Medicare Drug Plan, Medicare Supplement, Retirement Planning

3 Reasons to Start Medicare Planning NOW!

Every last one of us is pretty much the same in this respect: we don’t take now for an answer. When the task is daunting, overwhelming, or complex, we always manage to escape doing it now by putting it off for tomorrow. We’re like a gaggle of Houdinis. Just when you think time constraints have us trapped, we magically free ourselves into an enchanted tomorrow land of channel flipping, Internet surfing, and power naps.

 

But some things are just too important to put off. Even for one more day, one more catnap, one more rerun of I Love Lucy. Medicare planning is one of these things. Not convinced? Here are three reasons why you should start the Medicare planning process now:

 

Reason #1 Mistakes Happen

Glitches. Mistakes. Goofs. If there is a way something can go wrong, Lord knows it probably will. Just like a customer service call can turn into several hours of God-awful hold music, a small slip-up in the Medicare process can turn a five minute solution into a month long ordeal.

 

This is because you are just one of the 10,000 people turning 65 everyday. Medicare has a lot to handle; little things can slip through the cracks. Even if you are fortunate enough to not make any mistakes, you still have to plan in advance for theirs.

 

Reason #2 You’ve Got a Ton of Decisions to Make

Do you need a med sup? Or should you go the Medicare Advantage route? Should you sign up now? Or wait until you are done working? When are the deadlines? What are the penalties? What is a donut hole and how do I navigate it?

 

Take these questions along with deciding between 24 drug plans, 11 supplement plans and a legion of Medicare Advantage options, and you’ve got yourself a to-do list you can’t leave until the last minute.

 

Reason #3 Your Hairdresser Is Not a Retirement Advisor

Getting advice from your family or friends over coffee at church or in-between hands of euchre won’t cut it.  And no, your all-knowing hairdresser won’t do either.   Although your loved ones and acquaintances may have your best interests at heart, they simply do not know the ins and outs of Medicare. What was right for them may not be right for you. And what they overheard at the grocery store is (gasp) probably not watertight advice.

 

This is why seeing an expert is a great (dare I say the only) way to make sure you are on the right track, ensuring you a smooth, penalty-free transition to retirement. But you may find it difficult to schedule an appointment if you wait last minute. We will still help you out, of course, but it will save you a lot of stress to plan an appointment weeks or months ahead.

 

So—when should you start the Medicare Planning process? If you are within 6 months of turning 65, the answer is…you guessed it…Now!

 

Well……

Maybe not now, right?

 

Not sure what to do next? Give us a call at 937-492-8800 for a free consultation!

4 Lightweight Tips to Prevent Medicare Fraud

Posted on July 18, 2019 by - Medicare, Medicare Advantage, Medicare Drug Plan, Medicare Supplement

4 Lightweight Tips to Prevent Medicare Fraud

 

An ounce of prevention is worth a pound of cure. Very few people use this saying anymore, but the truth of it is still relevant—almost shockingly so. Especially when it comes to Medicare fraud.

 

No one wants to be a victim. No one wants to deal with some con down in Florida, racking up charges using their Medicare number. And no one wants to feel taken advantage of.

 

That’s why it’s much better to take the simple steps now. So let’s get started.

 

  1. Protect your Medicare Number!

First things go first. It’s the oldest tip in the book, but it works. This number is unique to you.  So protecting those 9 digits is doubly important: It’s your identity.

 

One way to protect your number is to avoid carrying the actual card unless you have to. And—this almost goes without saying—don’t share it with anyone except your doctor, health care provider, and your insurance agent, who will need it to write a policy.

 

  1. Take a Lesson From Sherlock Holmes.

This sounds like a pound-sized piece of advice, but it’s really not too heavy once you get into the habit. Be like Mr. Holmes and notice the small stuff. Check your Medicare Summary Notice for anything suspicious (i.e. billing to Medicare for care or services you didn’t receive). Check your pills before you leave the pharmacy to make sure everything is correct. Did you get your full prescription?

 

It pays off to notice things that no one else does. It’s elementary, my dear…umm…Medicare beneficiary?

 

  1. Strive to Understand for Yourself.

This is another tip that sounds heavier than it really is. So allow to me translate. For all intents and purposes, this means to ask questions. And I mean a lot of questions.

 

When you don’t understand your bill or your plan or your Medicare options, just ask. Ask your doctor’s office, or ask at your insurance agent’s office.  Shift the weight on the expert to help you understand. If he gives you a boulder-sized answer, give him another boulder-sized question. And don’t let down until you get a manageable answer. This might sound stubborn, but you have a right to know what you want about your health care. It’s the expert’s job to give you an understandable (yet accurate) answer.

 

Because knowing how Medicare works, your plan works, and why you were taken care of the way you were are excellent starting points for noticing and preventing fraud.

 

  1. Don’t go to the mousetrap for the free cheese.

Only a mousetrap has free cheese. This is the truth with all the sales and advertising junk pared away.

 

It’s not that I don’t understand the allure. Someone comes to your door or calls you to offers you something for free. Do you believe it? FREE! All you have to do is give them your Medicare number and then POOF…all your money saving dreams can come true.

 

But don’t fall for it. Don’t go for the cheese. This is a surefire way to get snapped into the metal jaws of Medicare fraud.

 

Stopping Medicare Fraud Ounce by Ounce

In closing, Medicare fraud is a crushing problem. The Medicare Fraud Strike Force is constantly hunting down the bad guys, trying to recover as many funds as they can. But it hardly puts a dent in the 60 billion dollar a year problem, according to AARP. This is why the government needs you to take the necessary measures of prevention. It’s a big problem, but I am confident that if enough people decide to get smart and do these small  “ounce-sized” things now, we can prevent another round of crushing Medicare fraud later.

 

Think you’ve been a victim of fraud? Want to make up to $1000? Then check out this post! 

 

Still have questions?  Call our office at 937-492-8800.  We can help!

How to Understand Medicare in 3 Simple Steps

Posted on June 20, 2019 by - Medicare, Medicare Advantage, Medicare Drug Plan, Medicare Supplement

How to Understand Medicare in 3 Simple Steps

 

Medicare, like many other government programs, is far from being easy to understand. From family and friends, you get little snippets of guidance, but nothing that gives you a cohesive picture. From the government, you receive the overly exhaustive Medicare & You handbook that is so thick and dry, it might as well come with a “drowsiness may occur” label. And, as for the rest of the Medicare mail, there is little more than ads, ads, and more ads, very few of which offer any more substance other than a quick sales pitch for a Supplement or Advantage Plan (you’ll learn what these are later on). For those approaching 65, understanding Medicare is often daunting.

 

That’s why I am writing this post. I want to help you see your Medicare “big picture.” I’ll try not to go into mind-numbing detail (although I can’t promise this will be evening pleasure reading), and I won’t give you unhelpful bite-sized chunks. You will likely still have questions afterward, but I hope this step-by-step guide helps clears up some confusion about what you will encounter as you make the transition from your private (or employer) insurance to Medicare.

 

If you don’t have time to read this right now, you can call us at 937-492-8800, and we can set you up with a Medicare expert who will walk you through all this information one-on-one.

 

But if you are ready to learn, it’s time to get started.

 

Step #1: Learning the Parts of Medicare

The best way to understand a complex topic is to split it up into parts. Medicare has made this easy for us because Medicare is already made up of four parts: Parts A, B, C, and D. It is essential that you understand them before we go any further.

 

Part A (A.K.A. Inpatient care, A.K.A. Hospital Insurance)

Part A is coverage for care received while officially admitted in at a hospital. Beyond that, it also covers skilled nursing/rehab, hospice, and some home health services. However, for simplicity’s sake, think Part A equals hospital insurance!

 

Part B (A.K.A. Outpatient care, A.K.A. Medical Insurance)

Part B, on the other hand, is the exact opposite, covering care received while checked out of the hospital. So, in a sense, it covers (at least in part) about everything else. This includes diagnostic tests, x-rays, and outpatient surgeries as well as an extensive list of preventative care options. Note that Part A and B together make up what is known as “original” or “traditional” Medicare.

 

Part C (A.K.A. Medicare Advantage)

The C in Part C is for complicated, so I’ve decided to address this later on in the post. For now, just keep it in the back of your mind. This is one of your “2 main options” we will meet again in step 3.

 

Part D (A.K.A Prescription Drug Plan)

The D in Part D is for drugs. In other words, it helps cover the bills for your medications. Part D drug plans are offered by private insurance companies that are regulated by Medicare. Whether or not you need one will be determined by which option you choose in step 3. If you do need one, you purchase it as a stand-alone plan based on your medications and preferences. I recommend using Medicare’s Drug Plan Finder.

 

Step #2: Understanding Signing Up for Parts A and B (Who and When and How)

Now that you have a basic understanding of Medicare’s parts, you should know who should sign up for Parts A and B, when you should do it, and how it is to be done. Let’s start with “who.”

 

Who Should Sign Up?

These two Parts are absolute musts! Everyone should sign up for Medicare Parts A and B eventually. Where situations differ is in the answer to the next question: when?

 

When Should You Sign Up?

Since Part A is free for most everyone, almost everyone should sign up Part A during their Initial Enrollment Period (IEP). The IEP is the seven-month period starting 3 months prior to your 65th birthday month. The only reason you might want to opt of Part A is because of HSA contribution difficulty.

 

Part B, on the other hand, has an associated premium of $135.50 (in 2019). This means if you will continue working and have better value coverage with your employer, it may be a good idea to put off signing up for Part B until you are finished working. Why pay the extra premium if you don’t need to, right?

 

However, you have to be careful with this. If you are going to delay signing up for Part B, you must make sure that you are qualified, otherwise you will incur a penalty. And even if you are qualified, you need to make sure it makes financial sense for you to do so. To give you a quick run down, in order for it to be a good idea to delay Part B, the following three things must be true about your situation:

  • You must have insurance through active employment, not retiree benefits or COBRA. In other words, you must be working (or you spouse must be working if you are covered under their plan).
  • Your employer insurance must cover 20 or more employees.
  • Your employer plan should be a better value than Part B.

 

For more details about whether you should sign up for Part B, click here.

 

If you found that you cannot delay, you must sign up for Part B during the Initial Enrollment Period, just like for Part A.

 

However, if you can delay, you just sign up when you retire. You will likely have a Special Election Period to sign up after your employer coverage ends.

 

How Should You Sign Up?

Unlike the last one, this one is easy and straightforward! There are four ways to sign up for Parts A and B:

  1. If you are already receiving Social Security benefits, it is automatic!
  2. You can sign up online at https://www.ssa.gov/medicare/.
  3. You can call your local Social Security Office.
  4. You can go and visit your Social Security Office for an in-person appointment.

Once you’ve signed up, expect your Medicare card to come in the mail soon after. Not too difficult, right?

 

Step #3: Understanding Your 2 Main Options

After figuring out the who and when and how of signing up for Parts A and B, this is where you have to make a big decision. It is here where the Medicare trail diverges into three possible paths:

  1. You could go with Original Medicare (Parts A and B) alone.
  2. You could pair a Medicare Supplement with Original Medicare.
  3. You could go with a Medicare Advantage Plan (Part C—I told you we’d meet him again).

 

I promise I can count (I’d be in bad shape as a financial planner if I couldn’t). The reason why it says there are only 2 options in the heading is because, although a very choice few disagree, most do not believe option #1 to be viable at all. Allow me to explain why:

 

Original Medicare Alone Leaves Some Potentially Devastating Gaps!

Parts A and B alone do not cover everything. For Part A, you have a $1,364 deductible that you may have to meet more than once per year and limited to no coverage for extended hospital stays. And for Part B, you have a 20% coinsurance on all outpatient services. And these are just a couple of the many costly gaps!

 

To give you an idea of what this might cost you, this means a 120-day hospital stay would be over $31,000! And if you have outpatient chemotherapy and radiation like my father-in-law, you could wind up being on the hook for over $30,000 that Part B won’t cover! Since there is no out-of-pocket spending cap with Medicare alone, there is no limit to what you might spend.

 

With that being said, I strongly recommend choosing one of the other two options (you can’t choose both). As the last part of our last step, we will look at what sets these two apart and outline some of the strengths and weaknesses of each.

 

What’s The Difference?

Medicare Advantage plans should be seen as an alternative to Original Medicare offered by private insurance companies that provide coverage that is at least as good as Medicare. Although you still have to sign up for Parts A and B, if you sign up for Medicare Advantage, the private insurance company will REPLACE Medicare as the payer of your claims. But you will still pay the Part B ($135.50 for 2019) premium each month.

 

A Medicare Supplement, on the other hand, pays SECONDARY to Medicare. Medicare pays what it normally pays for, and then the Supplement swoops in to pay your share of the costs (i.e. those gaps we talked about earlier such as 20% on outpatient services).

 

What Are The Strengths And Weaknesses of Each?

To put it simply, the Medicare Advantage Plan wins at cost effectiveness. As an in-the-ballpark figure, an Advantage Plan will cost you about $60 per month on average. Some are even $0 premium plan! A Supplement, on the other hand, will cost an average of about $110 per month. In addition, an Advantage Plan almost always has a built in drug plan, while you will have to buy a stand-alone drug plan if you have a Supplement, which (depending on your medications) is about an extra $35 per month.

 

However, a Medicare Supplement wins at just about everything else. They cost you less in out-of-pocket expenses throughout the year. Their benefits package is much more stable every year. You have more freedom to choose healthcare providers, and you are more likely to have out-of-state coverage.

 

For a more in-depth look at the pros and cons of these two options, click here.

 

When it comes to deciding, it is all about what is important to you. For instance, if you travel a lot, out-of-state coverage may be very important to you. Therefore, you may want a Supplement. However, if you are more cost-conscious, an Advantage Plan might be the best. It’s all about finding the best plan to meet your unique needs and preferences.

 

Retiring soon and don’t know what to do? Call us at 97-492-8800 to discuss your options. No high-pressure sales pitches here, just in-depth discussion about the ins and outs of Medicare!

 

Do I Need to Sign Up For Medicare If I Have Insurance with My Employer?

Posted on June 6, 2019 by - Employer, Medicare, Medicare Drug Plan, Medicare Supplement, Retirement Planning

Do I Need to Sign Up For Medicare If I Have Insurance with My Employer?

This is an important question. If you sign up for Medicare, and you didn’t need to, you end up forking over cash in premiums for insurance you don’t even need. However, if you don’t sign up for Medicare and you needed to, the results are equally frustrating: penalties or high out-of-pocket expenses that suck the life out of your nest egg.

 

Here is an easy-to-follow guide to help you make a decision that’s the best for you. I’ll address each part of Medicare individually to help you come to a decision for each.

 

For a more in-depth explanation of the parts of Medicare, click here.

 

Part A (A.K.A Hospital Insurance or “Inpatient Care”)

This is an easy one. You can go ahead and sign up for Part A, regardless of whether you have insurance with your employer.

 

Why?

 

Because Part A is absolutely free! If there’s no premium, why not just take the coverage? As long you or your spouse has paid into Social Security for ten years or more, there is no associated cost.

 

There is only one reason why you would want to delay Part A: Health Saving Account contributions. You can still withdraw from a health savings account, but you cannot continue making contributions if you are on Part A.

 

But other than that, this is a simple decision. More often than not, you can just go ahead and sign up.

 

Part B (A.K.A Medicare Insurance or “Outpatient Care”)

Part B, on the other hand, is much more complicated. But in the end, your decision will boil down to your answers to three questions:

 

  1. Is my coverage through active, current employment?

The keywords there are “active” and “current.” In order to delay Part B without penalty, you or your spouse must have insurance coverage through active employment. You have to be on the floor or in the office (or at home in your PJs if you are lucky enough to have one of those jobs)! This means retiree benefits or COBRA or any other insurance that begins after you are done working do not count.

 

  1. Is your employer the primary payer (as opposed to Medicare)?

You can delay Part B without penalty as long as you can answer “yes” to question #1, but unless you can answer yes to this one, you may be stuck with some hefty bills on outpatient services. If Medicare is the primary payer and you don’t have Medicare, you will have to pay 80% of your outpatient healthcare expenses.

The way to find out if your employer is the primary payer is pretty simple. If your employer’s health insurance plan covers 20 or more people, the employer pays first. If it insures less than 20 people, then Medicare pays first. Ask your employer or human resource representative for the exact number to make sure!

 

  1. Is your employer plan less expensive?

None of these questions really matter if Medicare is the better value. Perhaps you can delay Part B without penalty (question 1) and without paying extra on outpatient services (question 2), but if Part B is the better value, why would you want to? That is why you must perform a cost to benefits analysis. If Medicare is the better value, then you should sign up for Part B. If it is not and you answered “yes” to the other two questions, it may be a good idea to delay.

 

Part D (Prescription Drug Coverage)

All that matters when it comes to deciding if you need to sign up for part D is whether or not your current drug coverage is “creditable.” In order for your drug coverage to be considered “creditable,” it must be at least as good as part D. In other words, it is expected to pay (on average) at least as much as a Medicare part D plan. To find out, ask your human resources department. When you turn 65 your employer will send you a letter telling you whether or not your coverage is creditable, but it is a good idea to find out beforehand for planning purposes.

 

So Let’s Recap!

  • Sign up for Part A unless you want to continue HSA contributions.
  • It might be a good idea to delay Part B if have insurance through current employment, your employer pays first, and your employer plan is a better value than Medicare.
  • As long as your current drug plan is considered “creditable,” you can delay Medicare Part D.

 

Are You Still Unsure About Your Decision?

If you still have questions about how your employer plan coordinates with Medicare (or about Medicare in general), you are not alone. Many people approaching 65 find themselves overwhelmed with all of the options and information. The good news is that Seniormark is here to help, and we offer our services at no cost to you. We will guide you through the entire process, ensuring that you avoid all the costly mistakes and pitfalls. Call Seniormark at (937) 492-8800 for a free consultation.