Category: Medicare

Tax Penalty Alert: Mixing Medicare and HSAs

Posted on March 23, 2017 by - Employer, Medicare, Medicare Advantage, Medicare Supplement

Tax Penalty Alert: Mixing Medicare and HSAs

Medicare and Health Savings Accounts just don’t mix.

Like oil and water. Like toothpaste and orange juice. Like shopping with grandkids and fixed budgets.

 

This is very important to know. When you start Medicare, either Part A or Part B, you have to stop contributions to your HSA account. Otherwise, you could be on the hook for some tax penalties. According to IRS publication 969, the penalty is 6% of your contribution and its interest until you remove the funds from your HSA.

 

So if you want to continue contributing to your HSA (legally, at least), you will have to delay getting on Medicare. But here’s the catch: Very few people can delay Medicare without receiving—you guessed it—penalties (there seems to be a lot of these nowadays). In fact, the only people who can forgo Medicare benefits without consequences are those who have adequate coverage with their employer through active employment. I’m not talking retiree insurance. I am talking Monday through Friday, on-the-floor or in-the-office work. It’s the only way.

 

And if you started receiving Social Security early and were signed up for Medicare automatically, I’m sorry to say you are stuck. You cannot contribute to your HSA, and it will be very difficult to get around it. This is because you are not allowed to opt out of Part A. Although you can drop Part B, being enrolled in Medicare Part A will still prevent you from contributing to your HSA.

 

However, it is important to note that you can still use the money in your HSA. There is no penalty for that. As a matter of fact, I would strongly encourage you to use your money. You’ve spent a lot of time building up that robust HSA; you might as well take advantage of it! You can use the funds for

  • Your Part B Premium
  • Your Drug Plan Premium
  • Your Advantage Plan Premium
  • Doctor’s Appointments
  • Copays

And this is just the beginning. There are many other qualified medical expenses you can use it for.

 

So don’t get too upset. You’re Health Savings Account is not obsolete. It’s just not going to grow much anymore. But that is just the way it is with a lot of things in retirement. Think of your nest egg. Your 401k. IRAs. It is just that time in your life when you stop working to save and start putting those hard-earned savings to work for you! When you look at it that way, it doesn’t seem too bad.

 

Have more questions about Medicare and your employer insurance?  Click here to receive your free copy of our handout:  “The top 4 questions Medicare-aged employees ask about their employer health insurance.“

 

If you still have questions — give our office a call at 937-492-8800.

 

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Turning 65 and Work For a Small Employer? Sign Up For Medicare Part B!

Posted on March 8, 2017 by - Employer, Medicare, Medicare Advantage, Medicare Supplement, Retirement Planning

Turning 65 and Work For a Small Employer? Sign Up For Medicare Part B!

The general rule of thumb is if you have employer insurance through active employment, you can delay Part B of Medicare without penalty.

 

But that certainly doesn’t mean you should! There are cases, of course, when your employer plan is the better value, and it works out for you to opt out of part B. However, in other situations, it may be very costly.

 

For example, consider the woman who came into our office earlier this year with an $8000 bill for her outpatient surgery. She opted out of Part B, but she had insurance through active employment. Shouldn’t her employer plan cover it?

 

Well, not always. You see, her insurance was provided through a company that employed less than 20 people. This made Medicare the primary payer of her insurance. And when she didn’t have Medicare? Well…it wasn’t good.

 

The costly mistake had to do with how coordination of benefits works between employer insurance and Medicare. Let’s take an employer health insurance plan that covers 80/20 as an example (insurance pays 80%, you pay 20%)

 

When an employer plan covers 20 or more employees, the employer plan is the primary payer of your claims. Therefore, your employer insurance pays 80% of the bill and Medicare (if you have it) pays the remaining 20%. In this case, it is not necessary to have Part B; you can opt out. You’ll have to pay the remaining 20%, but it saves you the $134.00 a month Part B premium.

 

But if your employer plan covers less than 20 employees, Medicare pays first. The whole thing is flipped. So what if you get the previously mentioned expensive surgery and don’t have Medicare? It will not just carry over to your employer plan. They won’t pay the 80% that was supposed to be covered by Medicare. Instead, you will be lucky to get them to pay the 20%, leaving you on the hook…80% or more on the hook, which might just be $8000 in uncovered surgery procedures.

 

This is why it is so important to ensure that you are signing up for Medicare at the right time. Just because your neighbor can opt out of part B doesn’t mean you can. They might work for a Honda or a Copeland, a company with thousands of employees. You might work for a small business of 15 people.

 

So check with your boss or human resources department. Ask and make sure. It could save you from an unexpected, expensive, and potentially crippling bill.

 

Confused about Medicare and not sure what to do next? Download our free E-book here, and let us walk you through it!  Still have questions?  Call our office at 937-492-8800 to schedule a free, no obligation appointment!

 

Will I Be Able to Afford Medicare?

Posted on February 16, 2017 by - Medicare, Medicare Advantage, Medicare Drug Plan, Medicare Supplement, Retirement Planning, Social Security

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. $134.00 will be your monthly premium unless you make $85,000 per year or more as an individual or $170,000 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 $15 to $128 monthly. The average cost for a drug plan is $35.63 in 2017. 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 $60 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 is only $166-366 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? 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!

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Medicare Part B and D: Make More = Pay More

Posted on January 17, 2017 by - Medicare, Medicare Drug Plan, Medicare Supplement, News

Medicare Part B and D: Make More= Pay More

It’s true. The premiums for your Part B and D coverage for Medicare are adjusted for income.

 

I get it. It’s a little infuriating. You’ve spent all of these working years paying more in Social Security than everyone else, and now you find out they might come back for seconds.

 

But before any public pickets or private fist-shaking takes place, I want to grant you a little bit of comfort: according to Social Security, less than 5% of Medicare beneficiaries pay higher premiums due to income. And out of our clients, we’ve only come across a handful of affected people.

 

But to make sure, I recommend checking out the following chart. NOTE: There are separate numbers for filing individually, jointly, and filing individually when married, so make sure you are looking at the right one.

 

If your yearly income (modified adjusted gross income) in 2015 (for what you pay in 2017) was
File individual tax return File joint tax return File married & separate tax return You pay each month in 2017 for Part B  

You pay each month in 2017 for Part D

 
$85,000 or less $170,000 or less $85,000 or less $134  

Your plan premium

 
Above $85,000 up to $107,000 Above $170,000 up to $214,000 Not applicable $187.50  

$13.30 + your plan premium

 
Above $107,000 up to $160,000 Above $214,000 up to $320,000 Not applicable $267.90  

$34.20 + your plan premium

 
Above $160,000 up to $214,000 Above $320,000 up to $428,000 Above $85,000 and up to $129,000 $348.30  

$55.20 + your plan premium

 
Above $214,000 Above $428,000 Above $129,000 $428.60  

$76.20 + your plan premium

 

 

So there you have it. Did you make the cut? And now…

 

4 Things You Need To Know

  1. Premium increases are based on your MAGI

MAGI (Modified Adjusted Gross Income) is the magic number. It is calculated by taking your Adjusted Gross Income (all the income you’ve earned minus deductions) and adding some of those deductions back in such as IRA contributions. It is a little hairy, but for most people their Adjusted Gross Income is so similar to their MAGI, it is irrelevant.

 

  1. It is based on the tax return you filed last year

So, in 2017, whether or not you are cursed with higher premiums is determined by the tax return you filed in 2016 based on your 2015 income.

 

  1. Being married but filing separately can have costly effects

Pay close attention to those numbers. You’ll notice that the premium increases are much higher for comparable amounts of income. So file jointly unless you have a really good reason for doing otherwise.

 

  1. You can appeal to have the increase removed

This is a big one. The government has been known to make mistakes. So, if you notice that you were wrongly charged, you can fill out an appeal, and they will double check (I’ll keep my fingers crossed for you). This is especially helpful in the case of a “life changing” event that drops your income. The Medicare approved “life changing” events include but are not limited to:

  • Divorce
  • Marriage
  • Death of spouse
  • Work Stoppage
  • Loss of Pension

If you believe your IRMAA is incorrect, you can request that the Social Security Administration make a new decision.  You can contact them on the national helpline at 800-772-1213.

 

For those of higher income, it does seem like the government is doing a double dip. But I sincerely hope that you are not one of those affected individuals. Thankfully, the measure excludes most!

 

Confused about Medicare and not sure what to do next? Download our free E-book to get you started.   If you still have questions, call our office at 937-492-8800.

 

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Saying Goodbye to Supplement Plans F and C

Posted on January 11, 2017 by - Medicare, Medicare Supplement, News

Saying Goodbye to Supplement Plans F and C

(Why It’s Happening and Why It Matters To You)

You can pocket your tear-soaked hanky now. You don’t have to worry! If you are currently on plan C or F and have come to know and love it, the government will not force you to give it up. But for those of you yet to meet Medicare Supplement’s most comprehensive and popular plan (F) and his trusty companion (C), you may never get the chance. In 2020, the government will discontinue them both.

This begs the question: if the plans are so popular, then…

 

Why Are They Being Discontinued?

It’s a long story, but I’ll keep it brief. It all began with the “doc fix” bill, which President Obama signed into law back in 2015. The purpose of this legislation is to increase Medicare payments to doctors, so they continue to accept Medicare beneficiaries at their practices. Sounds like a good deal, right?

But by signing this bill, Medicare agreed to a hefty associated price tag of 200 billion dollars (according to The Hill). The money has to come from somewhere, so the federal government went to work on reforming Medicare in order to foot the bill for the bill (the bill’s bill, if you will). Phasing out plans C and F just happened to be the product of their brainstorm.

Here’s how they expect it will save Medicare money: Since plans C and F are the only ones that offer Part B deductible coverage ($166 in 2016), getting rid of both makes all Medicare beneficiaries responsible for their Part B deductible. Their hopes are that this will cause retirees to question their need to go to the doctor. The rationale is “if Medicare beneficiaries have a little more skin in the game (having to pay the deductible), maybe they won’t go to the doctor for every cough, ache, pain, or sniffle”. This—they believe—will save Medicare some cold, hard cash!

But this leads us to yet another “why” question…

 

Why Does It Matter to Me?

If you plan to enroll in Medicare after 2020, it’s quite obvious: plans C and F won’t be available to you. However, even if you are currently on plan C or F, saying goodbye to either one of these plans could have a costly effect on your monthly premium.

When a plan discontinues, it stops younger and healthier people from getting on the plan. This leaves an aging pool of beneficiaries, who (at least statistically speaking) have more health problems and file more costly claims. In order for the insurance provider to survive, they will likely counteract this loss with premium hikes.

Of course, this still leaves a lot of the 200 billion still unfunded, which—according to Forbes and Money Magazine—will likely come at high cost to Medicare beneficiaries.

To read more about how the “doc fix” bill could affect you, click the following link:

Proposed Medicare ‘Doc Fix’ Comes at a Cost to Seniors

 

Approaching 65 and not sure what to do? Click here to download our free E-book to get you started.  As always, you can call our office at 937-492-8800 with any questions.

 

The Little Known Shortcut Out of an Advantage Plan You Hate

Posted on January 2, 2017 by - Medicare, Medicare Advantage, Social Security, Uncategorized

The Little Known Shortcut Out of an Advantage Plan You Hate

Buyer’s remorse. Everyone has been there. You might feel like you were misled, misinformed, or like you just plain missed it. But—regardless—it doesn’t feel good. And when you believe you’ve been locked into your purchase for a whole year—like people so often think after switching to an Advantage Plan—the regretful, trapped feeling only grows in intensity.

 

So you can imagine the relief when I tell my clients that there may still be a way out—a little known shortcut out of a seemingly costly dead end. This is exactly what I am telling you today.

 

It’s Called the Medicare Disenrollment Period

Extending from January 1st to February 14th every year, the Medicare Disenrollment Period offers you an outlet to drop the Advantage Plan you hate. All you have to do is call or write your Advantage Plan provider and notify them. From the time you drop your plan, the changes go into effect the 1st of the following month. No questions asked. You are then automatically signed up for traditional Medicare (Parts A and B).

 

Warning: Time Crunch Ahead

The vast majority of people will want to get on a Medicare Supplement before they dis-enroll from Medicare Advantage. If this is you, you want to plan ahead to ensure you have time to get it all done.

 

Although some people will have what is known as a “Guaranteed Issue Right” or a “trial right,” and therefore, won’t have to take the extra steps of getting approved, many people will not. In fact, most have a fairly cramped checklist to complete before February 14th arrives. They will have to

  1. Shop for a Medicare Supplement
  2. Apply for a plan (and undergo medical questioning)
  3. Receive letter of approval from the plan.
  4. Dis-enroll from their advantage plan.

All within the short 45-day disenrollment period! This is an especially difficult feat if the Medicare Supplement Company is running slow and the “receive letter of approval” portion of the to-do list takes 2 weeks or more.

 

So start early and finish the course way before Valentine’s Day. Because—although it may not say I love you—nothing kills romance like being stuck on a shoddy Advantage plan.

 

Any issues or concerns with your Advantage Plan? Contact Seniormark at 937-492-8800 for a free consultation.

 

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Why You Can Try a Medicare Advantage Plan at No Risk

Posted on November 1, 2016 by - Medicare, Medicare Advantage, Medicare Supplement

Why You Can Try a Medicare Advantage Plan at No Risk

Infomercials have done it for years. When people feel uneasy about trying a new product, they offer a free trial or a money back guarantee. It provides security for the buyer to know that even if the supposed benefits of a product were oversold or blown out of proportion, he can still send it back. There’s no risk.

 

Well, Medicare offers something very similar. It’s called the “Medicare Advantage Trial Right”.

 

A lot of people are uncomfortable with trying Medicare Advantage because they don’t want to feel trapped in a plan they hate until the next Annual Enrollment Period. The trial period takes this risk away. As long as it will be your first time enrolling in a Medicare Advantage Plan, you qualify for Medicare Trial Right! This means that—no matter what time of year it is—you can drop your Medicare Advantage plan with no penalty and enroll in a Medicare Supplement Plan. This “free trial” period lasts 12 months from the date the Advantage Plan coverage goes into effect.

 

But as the infomercial cliché puts so obnoxiously…

 

WAIT…There’s More!

Some people believe that if they have pre-existing conditions and get on an Advantage Plan, they will be denied switching back to a Medicare Supplement Policy based on their health. In other words, they think that if they give up their Supplement for an Advantage Plan, they will never get it back. But that’s where the “money back guarantee” part of the deal comes in. Regardless of health, the Medicare Trial Right guarantees that you will be able to get back on a Supplement, no medical underwriting involved.

 

It’s true that Medicare Advantage plans are alluring with their sometimes shockingly low premiums. But they aren’t always the right fit for retirees. They change unpredictably and can be quite a hassle. This is why the Trial Right is so beneficial. It allows you to try a plan on for size, and then toss it back on the rack. To test drive it around the block, and then park it in the lot if it doesn’t meet your standards. And all the while, it guarantees that your old, trusty Medicare Supplement will be there.

 

Want to look into switching to a Medicare Advantage Plan? Call Seniormark at 937-492-8800 for a free consultation.

 

Other questions about what to do during Medicare Annual Enrollment?  Download our Annual Enrollment Checklist and you can relax when it is complete!

 

 

Don’t “Set It and Forget It” This Annual Enrollment Season!

Posted on October 18, 2016 by - Medicare, Medicare Advantage, Medicare Drug Plan, Medicare Supplement

Don’t “Set It and Forget It” This Annual Enrollment Season!

 

Does anyone remember Ron Popeil? If you don’t, allow me to rephrase the question. Does anyone remember the “set it and forget it” infomercial king?

 

I bet it’s ringing a bell now.

 

I, for one, can still see him in his green apron, armed with nothing but some well-seasoned meats and a fancy rotisserie cooker, taking the cheesy and overly scripted infomercial world by storm: “All you have to do is…” The unrealistically enthused audience chants, “SET IT AND FORGET IT!”

 

He was like the Billy Mays of the 70s, but with food instead of cleaning products.

 

But I digress…back to the topic at hand. The reason I retrieved this slogan from memory lane is to make a point: Many people have the “set it and forget it” mindset with their Medicare Health Insurance Plans. They think that once they undergo the process of enrolling in Medicare, enrolling in supplemental coverage or an Advantage plan, and signing up for a drug plan that they never have to change anything again. Happily ever after.

 

But this just isn’t true. Yes, most of the work is done. And you’ve definitely done the minimum to get by. But there’s a good chance your situation will change over time. And, even if your situation doesn’t change, there is a very good chance your health care plans will, oftentimes drastically. This leaves you in an ill-fitting plan that doesn’t meet your needs or your budget. You may need to switch!

 

When it comes to Medicare Annual Enrollment, there is a reason for the season. From October 15—December 7, you have the opportunity to make strategic changes to your health care plans.

 

Here are 3 reasons you might need to make changes this year!

 

1.  The Medicare Supplement Creep

Medicare Supplements are typically consistent from year to year. The benefits are guaranteed to stay the same, and the premiums rarely increase drastically. But the premium cost almost always creeps up, dollar by dollar, slowly but surely.

 

If you stay on that ride for too long, you could end up paying $100+ more a month than you should. In fact, if you have been in the same Medicare Supplement Plan for 4-5 years, there’s a good chance you’re paying too much for it. Shopping around for a better deal this year could save you hundreds…and all without reducing your coverage.

 

REMINDER: You can change your Medicare Supplement any time of year, not just annual enrollment.

 

2.  The Advantage Plan Leap

There are so many aspects of an Advantage Plan that can frog around over time. The deductible may go up. The premium may go down. You might have higher copays. Your coinsurance might drop. And beyond benefits and price, doctors and hospitals may go in and out of your plan’s network. A doctor available to you this year, may not be available the next.

 

This is why it is important to review your plan. Is your family doctor still within the plan’s network? Is it still the best value for you? If you simply set it, forget it and let it skate by another year, you’ll never know.

 

3.  The Drug Plan Drop

A drug plan may vary in cost from year to year, but what you really need to check is the list of medications the policy covers, also known as the formulary.

 

Over the years, a drug plan may discontinue or reduce coverage on certain medications. Imagine if the drug it discontinued was your most expensive one, and you didn’t realize it. Yeah…it could be a financial disaster.

 

Review Your Plan This Year!

So make sure to take control of your health insurance options. Review your plans, and take careful note of all the changes. The “set it and forget it” philosophy might work well for cooking chickens, but it doesn’t work for this.

 

For your health insurance, I offer another slogan: If you set it and forget it, you might regret it.

 

Maybe that will catch on…

 

Yeah…probably not.

 

If you haven’t already downloaded our Annual Enrollment Checklist, there is no time like the present!  Make sure you have completed it — and then you can forget it — until next year this time!  Download it here:  https://seniormark.com/annual-enrollment-period-checklist/.

 

Looking to review your plans with a Certified Senior Advisor? Call Seniormark at 937-492-8800 for a free consultation.

 

6 Things Everyone Needs to Know About Their 2 Medicare Choices

Posted on September 27, 2016 by - Medicare, Medicare Advantage, Medicare Supplement

6 Things Everyone Needs to Know About Their 2 Medicare Choices

Medicare Advantage and Medicare Supplements. Two feasible choices. Two Medicare buzzwords. One startling misconception. And here it is: Medicare Advantage plans and Medicare Supplements are the same.

 

But this is just not true…not even a little. In fact, Medicare Advantage plans and Medicare Supplements are fundamentally different. So different that not knowing these differences could cost you…in convenience, in security, and in dollar signs.

 

So…without further ado…these are the 6 things you need to know about the 2 Medicare choices:

 

  1. Medicare Supplements pay secondary. Medicare Advantage Pays Instead.

The “street name” for a Medicare supplement is a “Medigap” plan, and it is a nickname rightfully earned. Medigap plans are called as such because they “fill in the gaps” of what traditional Medicare (Parts A and B) doesn’t cover. Therefore, you will have little to no out-of-pocket expenses. A Medicare Advantage plan doesn’t do this. It functions as an alternative for traditional Medicare. This means that—if the Advantage plan doesn’t cover it—you can be stuck with some pesky deductibles, copays and coinsurance.

 

  1. Medicare Advantage Plans have Networks. Medicare Supplements Don’t.

Medicare Advantage plans contract with specific hospitals and health care providers. And if you don’t go to their pre-picked “network” of providers, your share of the costs may rise. In some cases (especially out of state), the plan may not cover you if you receive care at a hospital outside of their network (except in the case of emergency)! Medicare Supplements allow you to go to any doctor or hospital you want as long as they accept Medicare.

 

  1. Medicare Supplements Don’t Change. Advantage Plans Do.

Since Advantage Plans are funded by government subsidies, their benefits are greatly affected by politics. The more money they can get from the government, the better their benefits and premiums can be. This means that plans will likely change from year to year and you may have to reevaluate, re-shop, and re-enroll in a different plan. Medicare Supplement plans are the opposite. Since the policyholder funds them, the plans are usually consistent from year to year.

 

  1. You Can Always Change to an Advantage Plan. You Can’t Always Change to a Medicare Supplement.

If you are in a Medicare Supplement plan, you can switch to an Advantage plan without any medical health questioning as long as it is during the annual enrollment period. It doesn’t matter if you have pre-existing conditions (with the exception of kidney failure); you will still be able to obtain coverage.

 

However, if you want to switch from an Advantage plan to a Medicare Supplement, it is not as simple. Although you can still enroll during annual enrollment, you will have to qualify based on your health. This can be a problem for those with pre-existing conditions. For instance, let’s say the government curbs their funding for your Advantage Plan. This raises the premium and lessens the benefits significantly. You have cancer. You can’t change to a Medicare Supplement because you couldn’t qualify based on health. What do you do? More than likely, you will have to stay with your unwanted Advantage plan!

 

  1. Medicare Supplement Have Premiums. Advantage Plans Have Low Or No Premiums.

While the average Medicare Supplement premium is up around $100-120 a month for a 65 year-old, the average Advantage plan premium is about 50-60. And (aside from your Part B premium) they may be completely free!

 

  1. Two Choices Can Quickly Become Two Hundred.

You only have two options in the beginning, but once you choose a route—whether Medicare Advantage or Medicare Supplement—it will likely multiply into many more choices. There are 11 supplements, 24 drug plans, and dozens of Advantage plans. Not to mention the other decisions you have to make regarding when and how to go about signing up for Medicare to avoid penalties. Like I always tell my clients, Medicare is a big animal. I always recommend consulting with a retirement advisor for help.

 

Turning 65 soon and not sure what to do? 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!

Medicare Answers at a Glance: Should I Delay Part B?

Posted on September 22, 2016 by - Medicare, Retirement Planning, Uncategorized

Medicare Answers at a Glance: Should I Delay Part B?

 

Medicare Part A is free, so there isn’t much hesitation to enroll outside of HSA contribution issues. But with Part B, there is a $121.80 associated premium, so those approaching 65 are a little bit leery. Do I really need it?

 

Let’s make this clear: most people do. So before you make the decision to opt out, make absolute sure that you are one of the few who don’t!

 

You should NOT delay Part B if…

 

1.  You are retiring from work.

Retiree insurance or COBRA doesn’t count. If you don’t have employer insurance through active employment, the answer is simple: don’t delay Part B. You will be left without outpatient coverage for as long as don’t enroll, and you will incur penalties if you sign up late!

2.  Your employer’s health insurance plan covers 20 or less employees.

Just because you have employer insurance and are still working does not give you an all-access pass to opt out of Part B. If the plan doesn’t cover at least 20 people, you should definitely enroll in Part B. But take careful note. The number of employees is not always the same as the number of insured employees. Some temporary or part-time workers may not be covered on the employer insurance plan. Check with your employer before making any hard and fast decisions.

3.  Your employer insurance is more expensive

This may seem obvious, but I felt compelled to include it. Just because you can delay Part B doesn’t mean you want to. Analyze the costs and benefits of both Medicare and your employer insurance to determine which is the better value.

 

If these three criteria don’t apply to you, you may very well qualify to delay Part B. But I always recommend running your situation past a Medicare expert to make sure. Retirement decisions are as complex as they are important. Get help when you need it!

 

Need Medicare questions answered? Download our free guide, “Introduction to Medicare”.  No high-pressure sales pitches here, just in-depth discussion about the ins and outs of Medicare!