Category: Retirement Planning

Medicare Supplement vs. Medicare Advantage: The Pros and Cons of Each

Posted on April 29, 2021 by - Medicare, Medicare Advantage, Medicare Supplement, Medicare Workshop, Retirement Planning

Medicare Supplement vs. Medicare Advantage: The Pros and Cons of Each

You may have encountered these buzzwords in television commercials, email blasts, or the piles of mail you’ve likely received from insurance agencies, but what do they mean? What is the difference between a Medicare Advantage Plan and a Medicare Supplement? Which is the best option for you?

 

First off, it is important to address that regardless of which option you choose, you need to sign up for original Medicare (Parts A and B) first.   As long as you’ve determined that you shouldn’t delay part B (because you plan to remain actively employed after 65), you should sign up for both within the 7-month period starting 3 months before your 65th birthday month.

 

Medicare Supplement, or “medigap” insurance as it is aptly nicknamed, fills in some of the gaps of what original Medicare does not cover.  However, Medicare is still the primary payer of your claims.

 

On the other hand, Medicare Advantage is an alternative; it replaces original Medicare as the primary payer of your claims and is offered through subsidized private insurance companies that have contracted with Medicare.

 

This difference makes a big difference when considering the benefits and detriments of each option—in dollar signs, security, and convenience. Because of this, let’s consider the pros and cons of each carefully.

 

Medicare Supplement (Pros)

Minimal Out-of-Pocket Spending – Although there are differences in coverage among each of Medicare’s lettered plans (A-N), supplements cover more gaps (such as deductibles, coinsurance, and copays) than Medicare Advantage.

Predictability – Not only is your coverage guaranteed to stay the same, the price is reasonably consistent from year to year. Although we recommend re-shopping your plan every 4-5 years to avoid the slow creep in premium prices, there won’t be any shocking or unprecedented changes.

Out-of- State Coverage – Supplements cover you in all states, not just your home state.

No Networks – You are able to use any doctor or hospital that accepts Medicare, not just ones within the preferred network of a specific insurance company.

 

Medicare Supplement (Cons)

Higher Premium – Medicare supplement premiums can range from around $70-270 with the average Medicare supplement premium in 2020 hanging around $134 a month for people aged 65-70. This is significantly higher than the average Medicare Advantage plan premium.

No Drug Plan – You have to buy a stand-alone Part D prescription drug plan, which has an average premium cost of 32.74 in 2020.

 

 

Medicare Advantage (Pros)

Low to No Premium– The Average Medicare Advantage plan cost in 2020 is about $36 per month in 2020 and a few are offered at no cost!

Built-in Prescription Drug Plan – Almost all Advantage plans include a drug plan, which means less hassle and no extra premium.

 

Medicare Advantage (Cons)

High Out-of-Pocket Spending  – Medicare Advantage may appear to cover more because they offer perks like vision, dental, and hearing (which are usually not worth covering ). They may even throw in a free gym membership. However, they usually cover less, employing more of a pay-as-you-go approach. For you, this means higher copays, coinsurance, and unexpected costs.

Unpredictability – Since the government subsidizes Advantage plans, your plan’s benefits and premium costs may vary widely from year to year.

Out-of-State Coverage…Sometimes – You can only receive coverage outside of your home state in emergencies.

Networks – Different Advantage plans have various preferred hospitals and doctors. If you do not use your plan’s preferred providers, you may find yourself with less coverage or—depending on the plan—no coverage at all.

 

The Bottom Line

All in all, the pros and cons of these two options can be summarized quickly and concisely: A Medicare supplement is more costly but with better benefits (leading to less hassle and more peace of mind); while a Medicare Advantage plan is inexpensive, but with fewer benefits (often leading to unexpected costs and stress).

 

But the bottom line is that both options do their jobs. They both limit the potentially high out-of-pocket spending that is left by Medicare alone. Whatever you choose, don’t leave yourself vulnerable to coverage gaps.  There are no pros to remaining with Medicare alone!

 

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!  Click here to sign up for our next workshop.

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!

 

Know Your Rights! (Your Medicare Supplement Guaranteed Issue Rights)

Posted on October 31, 2019 by - Employer, Guaranteed Issue, Medicare, Medicare Advantage, Medicare Supplement, Retirement Planning

Know Your Rights! (Your Medicare Supplement Guaranteed Issue Rights)

Everyone knows that they have the right to remain silent and the right to an attorney, but few retirees know their rights to a Medicare Supplement policy. For this reason, many people believe that if they missed their Open Enrollment Period and have health problems, they will be unable to get insurance.

 

This is not so. Thanks to guarantee issue periods, retirees like you have rights. During guaranteed issue periods, insurance companies are obligated to offer you a policy at the normal rate and cover your pre-existing conditions. All of this with no pesky medical questioning whatsoever!

 

The following circumstances spur a guaranteed issue period. In other words, you have the right to a Medicare Supplement policy if:

  • Your Medicare Advantage Plan is going out of service or you are moving out of the service area.
  • Your employer health insurance is ending.
  • You’ve been enrolled in an Advantage Plan for less than one year and want to switch back to a Medicare Supplement plan.
  • You lose your coverage without fault (i.e. your insurance company goes bankrupt).
  • Your insurance company misled you or doesn’t follow the rules.

(For a more comprehensive chart of potential situations, click here to visit Medicare.gov).

 

From the day any one of these events happen to you, you have 63 days of guaranteed issue to get into a new Medicare Supplement Plan.

 

Do not take this newfound information lightly, and keep any proofs of the previously mentioned events at your disposal such as:

  • Claim denials
  • Letters from employers
  • Official notifications

 

Insurance companies will ask for these items to prove your right to a policy. Then they will have no choice but to insure you. This is why it is so important to educate yourself on your rights. It allows you to take advantage of what has been made available to you.

 

If you want to find out more about guaranteed issue rights or need help shopping a Medicare Supplement Plan for your needs, Call Seniormark at 937-492-8800 for a free consultation from licensed experts.

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!

Not Tech-Savvy? Here’s How to Sign Up For Medicare

Posted on August 1, 2019 by - Medicare, Medicare Advantage, Retirement Planning

Not Tech-Savvy? Here’s How to Sign Up For Medicare

 

You might feel comfortable surfing the net, but that doesn’t mean you are ready to brave the more serious aspects of the online world, like online banking or enrollment in Medicare.

 

As soon as a website starts asking for personal information like your social security number or place of residence, I can understand your hesitation. You want to talk to real people with real faces, not interfaces or cold, algorithm-driven databases. If this is you, you are at the right place. Here are a couple ways to sign up for Medicare… the old fashioned way!

 

Call the Regional Social Security Office at 1-800-772-1213

 

At one time, this was the tech-savvy option, but not anymore. Nowadays, in the world of texting and email, it is almost nostalgic to hear another person’s voice across the line. Of course, you won’t hear the local operator anymore; in fact, the person who picks up won’t even be local. They will be from the regional Social Security Office, which is in Chicago (if you are from Ohio). Just tell them you need help signing up for Medicare, and they should guide you through the process from there.

 

Visit Your Local Social Security Office

If you would still feel more comfortable sitting down with someone face to face, this option is the way to go for you. However, it’s quite time consuming. If you call and schedule an appointment, there could be a 1-2 month wait before you get in! And if you walk in without an appointment, don’t be surprised if you have to take a number and hang out in the waiting room for a while, 30 minutes or maybe more.

 

Of course, these two choices are not nearly as fast as signing up online, nor are they the most convenient. But there is something to be said about that personal interaction of a call or a face-to-face meeting. It provides an element of trust that is hard to find on the web.

 

If you run into any problems, questions, or concerns while signing up for Medicare, give Seniormark a call at 937-492-8800 or just walk right into our Sidney office right next to Culvers. We can guarantee you won’t have to take a number and wait!

 

CONSUMER ALERT: Seniors Should Beware of DNA Testing Scam

Posted on July 3, 2019 by - Medicare, Medicare Advantage, Medicare Supplement, News, Retirement Planning, Social Security

COLUMBUS – Ahead of World Elder Abuse Awareness Day this Saturday, June 15, the Ohio Department of Insurance and the Ohio Department of Aging are warning Ohioans of a new scam targeting seniors. Ohio consumers should be cautious of genetic testing firms visiting senior communities or making unsolicited phone calls and mailings related to DNA screenings.

“Scam artists are always looking for new ways to steal money or personal information,” said Governor Mike DeWine. “We want people to be careful and to know the signs of a possible scam.”

 

In the scheme, which has been reported in Ohio and other states, firms reportedly collect consumers’ personal information under the pretense of DNA testing to screen them for cancer, Alzheimer’s, or other life-threatening diseases. Victims are told that Medicare will cover the cost of their testing. However, Medicare provides limited coverage for DNA testing (which is why consumers should consult their health care providers). As part of the scam, consumers often are asked for their Medicare card number and Social Security number.

 

“We want Ohioans to be aware and cautious as they consider DNA screening services,” said Ohio Department of Insurance Director Jillian Froment. “Consumers should never share their personal information, including Social Security number or Medicare card number, with anyone who reaches out unexpectedly. If you think you may be a victim of fraud or if you suspect potentially fraudulent activity, please contact us.”

 

“Scammers and shady businesses target older adults to steal money, get personal information, or in this case, improperly access individuals’ insurance benefits,” added Ohio Department of Aging Director Ursel McElroy. “As older adults get wiser to common scams, scammers are doing more to try to win their trust. Guard your Medicare or other insurance card like you would a credit card. To a scammer, it is just as valuable.”

 

To protect yourself, be alert if anyone conducting DNA cheek swabs requests that you agree to be billed for services in the event Medicare does not pay. These types of “testers” may be committing Medicare fraud because they are attempting to bill Medicare for a procedure that has not been ordered by a health care provider.

What Should Medicare Recipients Know About Genetic Testing?
  • In order for the testing to be covered by Medicare, it must be medically necessary.
  • Consumers should always confirm that their test has been ordered by their doctor, that it’s covered by their plan, and that it’s medically necessary.
  • If you are interested in DNA screening, talk to your doctor and determine if it is right for you.

How Can I Protect Myself from This Type of Scam?

  • If you or a loved one is approached by someone claiming to offer genetic testing, do not give your personal information (like your Medicare or Social Security information) to them.
  • Theft of Medicare card numbers may be used to commit identity theft or fraud.
  • Instead of receiving a DNA screening unsolicited from a firm not affiliated with your health care provider, talk to your doctor first and determine if the test is necessary.
  • Some consumers have reported receiving DNA testing kits in the mail without requesting them. Consumers should not use these kits but should instead talk to their doctor first.

If you suspect wrongdoing or if you believe you have been victimized, call the Ohio Department of Insurance’s Fraud and Enforcement Hotline at 800-686-1527 or the Ohio Senior Health Insurance Information Program at 800-686-1578.

Older Ohioans and their loved ones can learn more about scams and other forms of elder abuse and exploitation, along with ways to prevent and report them, on the Ohio Department of Aging’s website (www.aging.ohio.gov/elderabuse).

 

Source:  Ohio Department of Insurance

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.

 

How to avoid the #1 Mistake on Medicare’s Request for Employment Verification Form

Posted on May 16, 2019 by - Employer, Medicare, Retirement Planning

How to avoid the #1 Mistake on

Medicare’s Request for Employment Verification Form

How many of you dread filling out Medicare forms?  Please raise your hand if you’ve ever had to correct the Medicare “Request for Employment Information” form (CMS-L564) for your employee.  When you complete the form, you’re hit with a fear that you might not remember how to properly complete this form.  Sure, you might fill them out from time to time, but this form never seems clear.  It’s daunting enough to prepare your employees for retirement – never mind assisting them with the Medicare process which seems like a full-time job itself.

 

Well, there is good news!  There is really only 1 question on this form that seems to trip people up.  AND we’re here to help you understand what Medicare is asking on this question and hopefully help you and your employees avoid any future issues.

 

Take a look at Section B of the “Request for Employment Information” form below.  Section B is the employer’s (aka HR Department’s) section.  And Question #2 is normally the main problem.  Are you ready to conquer this question?  Let’s dive in.

 

 

 

 

 

 

 

As most of you know, this “Request for Employment Information” form is required if your employee is over the age of 65 and outside of their initial enrollment period for Medicare.  They must submit this form with their Medicare Part B enrollment form to qualify for a Special Enrollment Period to sign up for their Medicare upon retirement.

 

For your employee to qualify for a SEP, they must meet 2 criteria:

  1. They must have group health insurance from ACTIVE employment (from their job or their spouse’s job) or have had such insurance within the past 8 months. AND
  2. They must have been CONTINUOUSLY covered by a job-based insurance since becoming eligible for Medicare (including the month they turned 65.)

 

For the most part, this form is filled out properly with no concerns.  But question #2 is typically the exception.  AND if question #2 is incorrect, it could mean big headaches for your employee.

 

So, why is Question #2 such an issue?  Well, if question #2 doesn’t reflect that the employee had insurance back to the month they turned 65 they WILL NOT qualify for a Special Enrollment Period.  No SEP could = BIG PROBLEMS for your employee.  It could delay their Part B start date and your employee could be assessed a Part B late enrollment penalty that will follow them for the rest of their life.

 

Question #2 states “If yes (the applicant was covered under employer group health plan), give the date the applicant’s coverage began. (mm/yyyy)

 

It seems simple enough.  You might wonder why that is so hard to answer?  Well, time and again we see that this date doesn’t reflect how long the employee had coverage but when the last “new” insurance company started.  For example, John Doe is 70 and has worked for your company for the last 20 years.  He has had group health coverage since February 1999.  BUT your company switched to a new insurance company on January 1, 2018.  Many times, we see the January 1, 2018 date on this form.

 

If the January 1, 2018 date is used, John Doe doesn’t qualify for a SEP because it doesn’t show that he’s had group health insurance from age 65 on.  John Doe will have to wait to sign up for Medicare Part B during the general election period (Jan 1 through March 31 each year).  His Part B coverage wouldn’t start until July 1.  John Doe would also have to pay a Part B late enrollment penalty for the months that he didn’t have coverage since turning 65.  This late enrollment penalty would last for the rest of his life. 

 

But, if the correct date is used in Question #2: February 1, 1999, he should qualify for a Special Enrollment Period.  He could elect the Part B start date (1st of the month).  He should not be assessed a Part B late enrollment penalty.  All is good (at least with the Medicare insurance.)

 

Now that you know how to tackle the Medicare “Request for Employment Information” form, you’re ready to focus on the many other aspects of your employee’s retirement process.  Do you have more Medicare questions?  Give Seniormark LLC a call at 937-492-8800.  We’re here to help!

 

10 Terms to Beef Up Your Medicare Literacy

Posted on November 8, 2018 by - Medicare, Medicare Annual Enrollment, Medicare Drug Plan, Medicare Supplement, Retirement Planning

10 Terms to Beef Up Your Medicare Literacy

In this day and age, you have a vast pool of knowledge available to you. But none of that matters if you can’t understand any of it. If you’ve done any researching on the Internet about Medicare, you know what I mean. To help you out, I compiled a list of important terms that often catch retirees unaware.

 

  1. Annual Enrollment Period (AEP)

The AEP is the busy time of year for Insurance companies such as ours. You can think of it as the black Friday of Medicare. It is the time of year (October 15—December 7) when Medicare beneficiaries can switch plans, drop plans, and join new ones. It is an open market, a bustling time for anyone involved with the Medicare industry.

 

  1. Open Enrollment Period

The day you turn 65 and are signed up for Medicare Part B is the first day of your open enrollment. This 6-month long time frame is the window in which you can get on ANY Medicare Supplement plan, regardless of health! You will want to take advantage of this…your options narrow significantly outside of open enrollment.

 

  1. Deductible

A deductible is the money you have to pay upfront before the benefits of a plan begin. For example, Part A of Medicare has a $1340 deductible. They will not cover anything until you reach it.

 

  1. Copayments

Copays are a set dollar amount you pay in addition to the payment made by the insurer (whether it be Medicare or a private insurance company). Think of the $10-50 fees when you visit the doctor’s office or buy a certain prescription drug.

 

  1. Coinsurance

This is very similar to copayments, but it is a set percentage instead of a dollar amount. For example, the Medicare Part B coinsurance is 20%. This means you pay 20% of the total bill, not a set dollar amount.

 

  1. Out-of-pocket Costs

All three of the previous terms (deductibles, copays, and coinsurance) are all a part of a much larger concept of out-of-pocket costs. In other words, your out-of-pocket costs are everything you pay for your healthcare beyond your premium. One warning you will receive a lot is this: With only traditional Medicare (parts A and B), there is no limit to your out-of-pocket spending. Yes, I am low-key warning you again, but hopefully you fully understand it now.

 

  1. Donut Hole

Speaking of out-of-pocket costs, for a Part D drug plan, they are highest in the donut hole, a gap in prescription drug coverage. You enter the donut hole when you reach $3750 in total costs and exit it once you reach $5000 in out-of-pocket costs.

 

  1. Drug Tiers

Drug plan companies often organize the medications they cover into levels. They call these levels—you guessed it—tiers. Drugs on a lower tier (often generic brands) have lower copays and coinsurance. Drug on a higher tier (such as brand name or specialty drugs) often have higher associated costs.

 

  1. PPO

PPO stands for Preferred Provider Organization. So a PPO is a health plan that has a network of “preferred” doctors and hospitals. If you use those doctors and hospitals, they reward you will lower out-of-pocket costs.

 

  1. HMO

HMOs (Health Maintenance Plans) are a little bit more intense than PPOs. It is the same idea, but HMO plans won’t cover you at all if you don’t use their network of hospitals and doctors.

 

That brings this list to close. If you are still confused about a term on this list, ask us for help in the comments section. Have you come across another difficult word on your Medicare planning journey that you think we should add? Let us know. We want to hear from you!

 

Annual Enrollment is the only time of year you can switch your Medicare Advantage Plan or Part D Drug Plan! Looking to review your plans with a Certified Senior Advisor this open enrollment season? Call Seniormark at 937-492-8800 or click here to set up a free consultation.