Dental, Vision, and Hearing: 3 Medicare Coverage Gaps You Probably Shouldn’t Insure
Many soon-to-be retirees find themselves concerned about transitioning from their employer insurance to Medicare because of the numerous coverage gaps, and I truly get it. If you spend a good deal of your career in an all-inclusive employer plan, switching to Medicare will feel like going from a gourmet buffet of benefits to a fast food value meal.
Prompted by that feeling, people often question: should I fill the gaps with extra insurance?
Now, this is a tricky one. For some of these gaps, I can definitely recommend it:
- 20% coinsurance on outpatient care.
- Minimal coverage on extended hospital stays.
- Limited coverage on skilled nursing care.
These are all viable reasons to seek extra coverage (usually in the form of a Medicare Supplement). And in the face of the fact that Medicare provides no out-of-pocket spending limit, I always recommend that every retiree have something to cap that off—whether it is a more expensive Supplement or a low to no cost Advantage Plan.
But then there are the strong three my clients consistently bring up: dental, vision, and hearing. As you may have heard, Medicare covers very little of these three. In fact, other than some complex dental surgeries received in a hospital and cataract removal, coverage for these three areas is basically non-existent.
But I have trouble recommending they get any insurance to cover them. I’m not saying there aren’t a few cases here and there (i.e. people who consistently need twice as much dental work as car repairs), but quite frankly it is just not worth it for the vast majority of retirees.
And here’s why…
You are likely going to spend about $400 per year for a stand-alone dental plan, which doesn’t sound like a lot until you hear what that money is really paying for. If it covered the entire cost of multi-thousand dollar oral surgery, then it might be worth it. But that’s exactly the problem: it doesn’t.
In fact, the maximum annual benefits for a dental plan is only $1000 in most cases. This is fine for the small stuff, the crowns or fillings that you could likely pay for on your own from a separate savings accounts. However, for the big-ticket items (the things you actually need insurance for), it doesn’t lighten the load all that much.
As far as vision goes, this is hardly ever bought as a stand alone, but is typically added on to the dental plan. And, like a dental plan, the benefits are equally lackluster.
When retirees think of coverage for hearing, they are usually considering a big hearing aid expense with the testing and diagnoses and equipment. There is one Advantage Plan that offers up to $3,000 of coverage for hearing aids, but then you have to consider that you may be giving up your rights to purchase a Medicare Supplement in the future, which often provides more comprehensive coverage on all fronts.
Are you willing to give up full coverage for outpatient services (only provided through a Medicare Supplement) for help on a one-time hearing aid expense?
Not very many are.
The Bottom Line
In all of this, we must remember one thing: insurance is for those things in life that provide a huge risk. It is for those things that would cripple us financially. You can buy insurance for your appliances, your gerbil, your front door, and your potted plants, but that doesn’t mean it’s a good idea.
And when it comes to dental, vision, and hearing, (although I don’t think it is as ridiculous as potted plant insurance), it isn’t a high enough risk.
Believe me. If there were a magical plan that bundled hearing, vision, and dental into a $30-40 per month plan and then covered all of your needs in these areas 100%, then I would be the first to recommend it to my clients. But the truth is, insurance companies need to make money, and—therefore—these kinds of plans don’t exist. Insurance companies (at least the ones who don’t go bankrupt) will always win at the numbers game.
What I usually recommend to my clients (if they are still concerned) is a little bit of self-insurance. Take the money you would’ve paid for extra insurance and put it in an emergency savings account. In 2.5 years, you’ll already cover the maximum annual benefit of a dental plan.
And after a few more, you’ll have enough of a cushion to be sitting pretty, virtually unconcerned about your hearing, vision, and dental care needs.
Looking For a Helping Hand as You Transition to Medicare?
At Seniormark, we are here to guide you through the process, answering any and all of your questions along the way. We will help you find an insurance plan that fits your unique needs and pocketbook. Call us at 937-492-8800 for a free consultation!