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Guide for Federal Retirees and Medicare Part B

by Jagger Esch
written by Jagger Esch

Medicare Part B covers physician and outpatient services. Part B can include ambulance services and durable medical equipment as well as laboratory tests and x-rays.

While most seniors get Medicare Part A “premium free”, most seniors pay a monthly premium for Medicare Part B. Generally, Part B premiums are taken out of your monthly Social Security check or a retirement check.

To Take Part B or Not to Take Part B, that is the Question

If you don’t take Part B when you are first eligible there is a 10% penalty on the current year premium added for each year you delay enrollment. You will need to pay this penalty for as long as you have Medicare.

You won’t owe a late enrollment penalty if you qualify for a Special Enrollment Period (SEP). This allows you to enroll in Medicare Part B and enroll through an SEP if you have health coverage based on current employment (yours or a spouse’s).

It’s important to know that not all coverage qualifies you for an SEP. The following types of coverage won’t qualify you for creditable coverage based on current employment and wouldn’t exempt you from paying the Part B penalty if you delay enrollment:

    1. COBRA
    2. TRICARE and Medicare– (unless you, your spouse, or dependent child are an active-duty member.) If you’re Medicare-eligible, you must be enrolled in Part B to continue receiving TRICARE benefits.
    3. Veterans’ benefits
    4. Retiree benefits

If you have coverage through a current employer (yours or a spouse’s) you may decide that you don’t need extra coverage. There is no penalty for delaying Part B enrollment if you or your spouse have other coverage based on current employment.

You can sign up for Part B through an SEP anytime that you’re still covered by the group plan or in the eight months after your employment or group coverage ends.

If you’re an active duty service member, you may delay enrollment, keep TRICARE and sign up for Part B during an SEP without paying a late enrollment penalty.

If you are 65 or over and still employed by the federal government or are a 65-year-old retiree that has health care coverage through your new employer or you are covered under a working spouse exemption, you can delay applying for Part B without penalty and that makes sense for many.

You can delay taking Part B without penalty if you switch FEHB coverage to a federally employed spouse to keep the benefit premiums non-taxable and delay without penalty for the 65-year-old retiree’s Part B enrollment. Unfortunately, retiree’s FEHB premiums are considered taxable income unlike active federal employees.

Many retirees work at another job after they leave the federal service. Federal retirees can also delay taking Part B without penalty if they are covered under a working spouse exemption or if they are working for other employers that provide primary healthcare coverage where the FEHB becomes secondary.

You must evaluate your costs to see if accepting insurance from your new employer would reduce your costs. If you start your own business or work for another company that doesn’t provide primary health insurance, you will be assessed a penalty if you don’t take Medicare B at age 65.

Part B Premium Determination

Medicare Part B premiums are determined by your Modified Adjusted Gross Income (MAGI). The higher your income, the higher your Part B premium. For many beneficiaries, the government pays a large portion of the Part B premium, about 75 percent, and the beneficiary pays the remaining 25 percent.

If you’re a high-income beneficiary, you’ll pay a larger percentage of the total cost of Part B based on the income you report to the Internal Revenue Service (IRS). If you have a high income and are considering not enrolling in Part B because you think it will save you money, this isn’t the case.

When you postpone enrolling in Part B, you’ll be subject to a late enrollment penalty that will increase your Part B premium the entire time you have Medicare Part B.

If you’re unsure about whether you should enroll into Medicare Part B, talking to your benefits coordinator at the place where you work can help you determine the best decision for you.

 

 

 

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Medicare Plans

How to Claim Medicare without Claiming Social Security

by Jagger Esch
written by Jagger Esch

Can you get claim Medicare benefits without claiming Social Security? You sure can, and we’re going to outline the reasons to consider this option along with some of the pros and cons of delaying your claim to Social Security benefits.

First, let’s look at some important information about Medicare and Social Security. Then, we can better understand why it makes sense to enroll in Medicare without claiming Social Security.

Medicare vs Social Security

Health insurance is offered through the Center for Medicare and Medicaid Services (CMS). Social Security provides people with a monthly stipend.

Medicare Part A is free for most recipients and Part B is usually deducted from your monthly social security check.

When beneficiaries enroll in Medicare at full retirement age, they may enroll through one of the online options. However, be careful if you do not want to activate your Social Security Income, or SSI benefit.

Follow the options that allow you to enroll in Medicare separate from your Social Security benefit.

Starting Medicare Benefits

With Medicare coverage, it’s important not to miss any of the deadlines or you’ll be penalized. The most important deadline is the Initial Enrollment Period, or IEP. This is a 7-month period that starts 3 months before the month you turn 65, includes the month you turn 65 and the 3 months after your birth month.

Even if you have creditable coverage through an employer, you will still want to enroll in Part A.

Part A is the hospital coverage. Since you are not enrolling in Social Security, that automatic trigger will not occur. You, as the Medicare beneficiary will need to enroll in Medicare only.

Part B, the medical coverage does have a premium that is imposed. When you decide not to claim your Social Security Income benefits, you will need to complete the enrollment form for Part B, and you’ll need to pay the monthly premium.

For most beneficiaries, it’s easiest to have the bill set as an automatic draft from a bank account.

Medicare Part D is the prescription drug coverage and you will need to select a drug plan and pay that premium directly to your insurance company.

In addition to your drug coverage, you’ll need to consider what type of coverage you want to fill the holes left by Original Medicare. A licensed agent can help you review your options, enroll and assist you in getting your reoccurring premium payments set up.

It’s imperative that you address how you will pay for Medicare Part B as delaying your Social Security benefit prevents SSI from paying that premium out of your monthly check.

Social Security

In this instance the Social Security benefit would be the SSI or Supplemental Security Income, commonly known as retirement benefits. SSI will serve as a monthly income when you’re ready to apply and start receiving benefits. Social Security benefits can be claimed as early as age 62 or as late as age 70.

If you claim social security benefits before you reach full retirement age, you will receive a reduced benefit for a longer period. If you wait until full retirement age (66 years and 4 months) or later, you will receive a higher benefit for shorter period.

This is a situation where you have to make a best guess. Consider some of the following:

  • Are you working?
  • How is your health
  • Does your family history indicate longevity of life
  • Do you have other income to support you if you delay taking your SSI benefit

 

If you apply to start receiving benefits before full retirement age, you’ll receive a reduced monthlybenefit. Your monthly benefit amount will always be reduced. Hence the reason so many beneficiaries opt to delay filing a claim with Social Security.

Furthermore, if you can delay applying for Social Security benefits until after “full retirement age”, your benefits are increased based on your birth year and the number of months you delay.

Once you reach age 70, the benefit increase no longer continues to grow. Currently, beneficiaries who delay receiving Social Security Income benefits are making about 8% more per month.

My Dad and his decision

My own dad, Joe, is receiving his social security income and started taking benefits when he was 65 years old.

Having been diagnosed with COPD in his late 20’s, then Atrial Fibrillation in his 50’s and a few other health conditions, Joe crunched the numbers around age 62. He decided that in order to get the most money from his years of paying into social security, collecting at age 65 presented the best-case scenario.

One in every four 65-year-olds will live past the age of 90. While it’s a tough pill to swallow, Joe doesn’t expect to live to 90.

So, in order to maximize his retirement earnings, he filed his claim for SSI at age 65. Yes, he filed prior to full retirement age. However, he now has the time and income to enjoy his golden years.

This is the reason why

Most people outlive their retirement savings and studies show we’re living longer than previous generations. With this in mind, we need to prepare for a longer retirement period.

That means if you can delay receiving benefits past age 65, you would receive a higher monthly payment. For most folks, that higher monthly payment would kick in around the time their personal savings has been exhausted.

Although you’re evaluating your life expectancy, you need would do well to keep in mind the life expectancy of your spouse. Especially if that spouse plans to collect Social Security Income based on your benefits.

Deciding when to collect your Social Security Income benefit will impact your retirement income as well as your spouse’s retirement income.

If your spouse plans to make a claim for Social Security Income based on their own benefits, then this is a moot point; your spouse would need to make these same decisions that you now face.

The short and skinny, there is no right or wrong answer. It’s never too soon to start considering your personal situation and begin evaluating where you are in life right now; measure that against how you want to live when you retire.

Every person is unique, and you need to weigh your options before deciding. Take heed of the call to action sang by the band Rush, “If you choose not to decide, you still have made a choice”.

It’s a lot to take in and it should take you more than an afternoon to decide if it’s in your best interest to claim Medicare without claiming your Social Security retirement income.

When in doubt, break out a pencil and paper and crunch the numbers.

Tip the scales in your favor and start planning for your future while it’s still in the future. After all, Medicare and Social Security have been planning how to fund your retirement since your parents were still part of the work force.

 

 

 

 

 

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Medicare 101
Health Insurance

Medicare 101

by Jagger Esch
written by Jagger Esch

While most individuals embrace the aging process, Medicare is excellent coverage that many seniors look forward to obtaining. Medicare has been providing health insurance coverage since 1965 for individuals 65 and older as well as certain disabled Americans.

Over 15% of the country is currently enrolled in Medicare today and that’s a definite bonus after having worked for most of our lives. Being on Medicare means having Hospital and outpatient coverage for many services.

Although, many seniors are unaware of the coverage they have and what expenses they’re responsible for paying. Having a Medicare Supplement could help you plan your health care expenses better.

Traditional Medicare Benefits

Medicare consists of two main parts:

  • Part A (Hospitalization)
  • Part B (Outpatient and DME supplies)

 

Medicare Part A is typically premium-free and provides coverage for your hospitalizations and skilled nursing facility stays. Additionally, Part A benefits provide coverage for home health and hospice care.

Part B premiums are ever-changing, typically they go up annually based on inflation. However, the government takes into consideration individual incomes, paid taxes and annual expenses. Many people with Part B don’t pay the full Part B premium.

Extra Help is available to those that qualify.

Part B benefits cover your outpatient costs for doctors’ visits, lab work, diagnostic testing, physical therapy, and outpatient surgeries.

Regardless of whether Medicare Part A or Medicare Part B is being used, each plan only covers at 80%. The remaining 20% leftover is the Medicare beneficiary’s responsibility to pay.

Both Plan policies only take effect after the Part A and Part B deductibles have been met. Each year the deductible cost changes so you can log onto Medicare.gov to see the exact rate for each deductible.

How to Qualify for Medicare

To become eligible for Traditional Medicare benefits, individuals must be at least 65 years of age.

When enrolling in Traditional Medicare you have a seven-month Open Enrollment Period (OEP). The OEP begins the three months leading up to your 65thbirthday, continues through your birthday month, and the remaining three months after turning 65.

Failing to enroll for Medicare Part A or Medicare Part B during the Open Enrollment Period can result in penalty fees.

Medicare Part A Penalty:

If you have Part A premium, an extra 10% is added for each year gone without Part A benefits. Based on how long one goes without Part A benefits will determine the number of penalty fees.

Medicare Part B Penalty:

With the Medicare Part B penalty, the monthly premium is increased an extra 10% for every year without Part B benefits. With the Part B penalty, the increased premium rates are paid for the entirety of having part B benefits.

Medicare is also available for certain individuals with end-stage renal failure and certain other disabilities. For those individuals who also receive social security benefits or certain Railroad Retirement Benefits, you’re automatically eligible and enrolled in Medicare Parts A and Part B after two years.

Part C Medicare Advantage Plans

Medicare Advantage Plans are provided by private insurance companies within your area. Premiums are based on the individual plans offered.

Part C Plans are oftentimes referred to as Medicare Supplement Plans as their benefits will take over coverage for that of Traditional Medicare Part A and Part B.

Oftentimes, Medicare Advantage Plans come with cheaper premium costs. So, those living on a fixed income find the sound of these policies appealing.

However, with the cheaper premium prices come at a price.

Medicare Advantage shortcomings include:

  • Restrictions
  • Referral requirements to see a specialist
  • Coverage limitations
  • Limited doctor, pharmacy and hospital networks
  • Limited coverage areas.

 

What seems like being more valuable, can end up costing more for the individual when it comes to their out of pocket cost. Coinsurance, deductibles and copayments are commonly discussed when you enroll in these plans.

Medicare Part D

Traditional Medicare offers no insurance benefits for prescription medications. With medications, especially brand name, the out of pocket costs at the pharmacy can be downright astronomical!

By obtaining a Medicare Part D Plan, AKA, a Medicare Prescription Drug Plan (PDP), you can get those medically necessary prescriptions at a lower price. In some cases, you can get them at no cost whatsoever.

Offered by the individual health insurance companies, you can pick the best Part D Plan to suit your prescription medication needs. Depending on the policy will depend on your premium prices.

Another bonus of enrolling in a Medicare Part D Plan is you will avoid the penalty fees.

Like the penalty fees of Original Medicare, failing to enroll during your 7-month initial enrollment period will result in an increase in the Part D premium charge.

Depending on how long one went without drug coverage will determine the additional premium fees each month.

Medicare Supplement Plans

There are also Medicare Supplement Plans, that like Advantage Plans, are purchasable through your local private insurance carriers.

With Medigap Plans, they work alongside the already excellent Traditional Medicare benefits. These plans provide extra coverage for those items not originally covered by straight Medicare.

Pending on which Plan is chosen, items like deductibles, coinsurance, copayments and other items not covered by Medicare can cost less for the beneficiary. In some cases, there are plans that offer complete coverage.

There are ten letter plans available to choose from and depending on your individual healthcare needs will depend on which plan best suits you.

For example:

Plan F

This plan provides 100% coverage of both your Medicare Part A and Medicare Part B deductibles.

It has the added benefit of paying for:

  • Medicare Part B’s copayments
  • Foreign travel emergency coverage
  • The remaining 20% coinsurance for your Part A and Part B fees

 

While Plan F is the most popular due to the great additional benefits, it also comes with a higher premium price tag.

High Deductible Plan F

There is also a Medicare Supplement Plan F High Deductible version that provides the exact same benefits, just with a deductible. The added bonus of this specific plan is there is a lower monthly premium so it’s cheaper for those on fixed incomes.

Plan G

This plan is another great Supplement Plan that’s also comparable to Plan F, however, there is no Medicare Part B deductible coverage.

Many times, the savings in Plan F premiums is more than the Part B deductible, meaning you get comprehensive coverage at a great price. Besides, Plan G typically has lower annual rate increases when compared to other plans.

Plan N

With this specific policy, it’s considered, “cost-sharing”. While the Medicare Part A deductible is completely covered, the beneficiary will be required to pay a small copayment for ER and doctor’s office visits.

It’s important to research all Medicare plans available, prior to picking your “perfect” plan. What works for one individual, may not work for another.

There’s plenty of information available regarding not only Traditional Medicare benefits, but also Medicare Advantage as well as Medicare Supplement Plans.

Medicare low Income Plans

While Medicare offers good healthcare coverage, those living on a fixed income may find it hard to afford monthly premiums, deductibles, coinsurance and copayments.

Even with lower premiums associated with Medicare Advantage plans or more coverage with Medicare Supplement Plans, the out of pocket costs can still be quite burdensome.

Those still struggling with healthcare costs there are Medicare Savings Programs that you may qualify for, applying is highly recommended when you meet the income requirements.

Additionally, each individual state has their own State Health Insurance Program, also known as SHIP. SHIP can provide financial assistance and relieve some of the stress associated with out of pocket costs for health insurance.

Changes in Medicare as of 2020

In the upcoming years there’s always the chance of change when it comes to not only premium and deductible prices, but also changes in policies.

The most major upcoming change will be the doing away with First-dollar coverage plans. What this means is that any of the Medicare Supplement Plans that leave a Medicare beneficiary without any out of pocket costs, will no longer be available.

This affects the 3 major first-dollar coverage Supplement Plans:

  • Medicare Supplement Plan C
  • Medigap F
  • High Deductible F policy

 

This change in 2020 is mainly due to congress feeling as though Medicare beneficiaries who have no deductibles or out of pocket costs, will then no longer overuse healthcare services they don’t necessarily need.

This upcoming change will only affect those eligible for Medicare benefits after 2020. Luckily for those who currently carry or are eligible prior to 2020, will be, “grandfathered in.” This means you may still reap the benefits of those first-dollar plans!

There will be other options available for those looking to enroll after 2020. You can still enroll in Medicare Supplement Plans with just some slight changes and a small overall increase in your out of pocket costs.

Getting good health insurance to converge should be simple. Traditional Medicare benefits, a Supplemental insurance plan as well as a Prescription Drug Plan can provide individuals with optimal healthcare coverage.

Medicare is readily available, easy to obtain and most providers take the insurance. Regardless of what you may have heard about Medicare in the past, take action and enroll in Medicare as soon as you become eligible.

The sooner you do the sooner you too can start benefiting from our government appointed healthcare!

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Retirement Planning

4 Questions to Ask Before Buying Long-Term Care Insurance

by Carol Marak
written by Carol Marak

My wife, Gina, and I are in year five of owning and running a home care agency, and we’ve experienced firsthand the pain of families struggling to pay for it.

After Gina and I helped managed care for my mother, Emily, as she transitioned into an assisted living facility near our home, we knew we couldn’t afford NOT to have a LTC plan. There are so many options, riders, qualifications and all of this was completely overwhelming.

Ultimately, the entire process took us about eighteen months, but we did finally choose a long-term care insurance policy that was right for us. Here are the 4 questions we’d encourage you to consider as you begin the research.

What is long-term care insurance and what do you need to know?

An excellent resource to get started is a Shopper’s Guide to Long Term Care Insurance. This is a great resource from the National Association of Insurance Commissioners that gives you all the basic information you need.

Do you need it and is it right for you?

After reading the guide, sit down with your spouse and discuss your feelings.

How much do you need?

This is a very tough question. A good financial planner would probably recommend looking at a two to three-year period of long-term care. If you plan to stay at home, personal care now costs an average of $25/hr. If you needed care 7 days a week for 8 hours a day over the course of 3 years, that’s $219,000. For one person. It’s a very realistic – and expensive – scenario.

What are your goals and what’s important to you?

Since we deliver services, we understand the costs of care and the various options and that helped us to hone in on our goals for long-term care:

  • Avoid being a burden on our children and/or counting on support from others.
  • Stay at home.
  • Get a policy with no ceiling or cap. Many policies pay based on what you put in and once funds are gone, they are gone.
  • We did not want a “use it or lose it” policy. If we didn’t use it, we wanted the full or remaining balance go to heirs.
  • Have minimal or no elimination period.
  • Find one with clear triggers to start care.
  • Offer a variety of services.

 

The most important advice we can give is to find a trustworthy financial advisor. One of the biggest things we learned is planning and choosing long-term insurance is a commitment, and it should fit into your overall retirement plan. You’ll find that many financial planners and advisors are also experienced with this type of planning, or they have relationships with some great long-term care insurance agents.

Searching for the right long-term care insurance plan was a long process, but we feel we’ve found one that works well for us.

-Guest writer, Tim Murray, President and Co-Founder, Aware Senior Care.

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Health Insurance

Long-Term Care Insurance: 3 Common Misconceptions

by My Senior Health Plan
written by My Senior Health Plan

Like any insurance plan, long-term care insurance provides financial relief when you need it most.

However, long-term care insurance is expensive. Given the expense, people put off buying a long-term care (LTC) policy or even making a plan for their future care needs.

But if they do need it (and the odds are higher as people age), and care facility costs and home-care provider fees start to build up, the premium can provide financial support and peace of mind.

Here are three common misconceptions why people think they don’t need an LTC plan and why rethinking that approach is important:

  1. “I’m healthy. I don’t need long-term care insurance.”

At age 66, Bill is in great shape. His vitals are good, and his weight is in a healthy range. He runs an annual half-marathon and lifts weights at the gym.

Additionally, neither his parents or grandparents required nursing care at home or in a facility. They all lived into their 80s and 90s, happy and healthy. With his stellar family history, Bill feels confident he won’t need long-term care. He plans to enjoy life!

While Bill is healthy and takes care of himself, it doesn’t make him exempt from needing care as he gets older. A fall or unexpected health problem could require paying for long-term care.

That might include hiring a home health aide to help with personal needs (e.g., bathing and dressing). At an approximate rate of $20 per hour, the costs add up over the weeks, months and years.

Like many, Bill is taking the I won’t need it approach. However, at the very least, he needs a plan. That includes talking to loved ones about long-term care:

Who will provide the care (his spouse, adult children, a home health aide)?

How will the costs be covered, including family members who may have to work less to help him?

  1. “I’m financially savvy and have a large retirement nest egg.”

Jackie and her husband have a substantial retirement portfolio. Having had a career in finance, she understands the cost benefits of LTC insurance. However, she’s reluctant to buy an LTC policy, as it will put a dent in their disposable retirement income.

Additionally, with the escalating cost of medical care, she’s not confident that the LTC policy will cover their care costs in 20-25 years. Going without LTC is a risk she’s willing to take.

One misconception about LTC insurance is that people will only need it in their later years. They tend to think of it as end-of-life care. However, LTC is the care you could need tomorrow while in your first years of retirement.

For example, if Jackie’s husband should need long-term care due to an accident or an unfortunate diagnosis, even with substantial retirement savings, her financial independence could be jeopardized.

She may want to weigh up the cost of care—that could run into high six figures and beyond—versus paying anywhere from $90 to $200 per spouse, per month.

  1. “I won’t qualify because I have existing conditions.”

Cody’s mom Jean has a chronic—but stable—health condition. Cody figures that the existing illness will disqualify her from long-term care insurance.

Unlike some insurance policies, LTC policies do cover people with chronic health problems. That may include diabetes, heart disease, and clinical depression. In fact, the underwriters’ lists of approved chronic conditions are substantial!

As long as the qualifying illness is stable, the insurance underwriters should approve the application.

In Cody’s mom’s situation, rather than dismiss LTC insurance due to her existing condition, Cody can work with an insurance specialist to explore their options. The specialist will walk him through carriers’ underwriting differences to find the plan that best fits his mom’s health and financial needs.

Who will benefit most from an LTC policy?

Should you need long-term care, a policy will provide financial support, allowing you to access the help you need. Also, it will relieve family members (spouse, children, grandchildren) of the economic and personal burden associated with your long-term care needs.

Ultimately, even some coverage is better than none. Also, buying long-term care insurance is as much for you as for your loved ones.

Now is an excellent time to start a conversation about your long-term care needs.

Aaron is MySeniorHealthPlan.com’s retirement specialist. He can help you explore your options and find a policy that fits your financial needs.

Call Aaron today: 1-877-255-6273

 

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Medicare Plans

How to Enroll in Medicare if You’re Working Past 65

by My Senior Health Plan
written by My Senior Health Plan

For decades, the gold standard for retirement age was 65. But in the last several years, we’ve seen the retirement age inch up with many folks working past 65. Now, 20 percent of Americans age 65 and older are participating in the workforce—the highest rate in nearly six decades.

Some of this is due to the U.S. government formally changing the Social Security retirement age. Since 1983, the retirement age, previously set at 65 has slowly inched toward 67, with the current age set at 66 and eight months.

But there’s more going on here. Not only are we living longer, but also the cost of living is exponentially higher than 10 or 20 years ago. Unfortunately, many of us weren’t able to adequately plan for retirement.

What is fortunate is that no matter your employment status, you can still enroll in your Medicare benefit at age 65. Here’s how.

What if you have employer-provided health benefits?

When you turn 65, even if you’re working, you gain access to what’s called the Initial Enrollment Period (IEP). If you have employer-provided healthcare, you can still apply for Medicare Part A.

You may be wondering why this is necessary. If you require medical care not covered by your employer-provided plan, your Medicare Part A plan will pick up where your primary coverage leaves off. Part A Medicare benefit is premium-free, so you stand nothing to lose financially by enrolling.

If you have a spouse who isn’t working, is over 65 and covered by your private insurance, the same principles apply.

But do stay on top of enrolling, because Medicare won’t remind you to sign up unless you currently get Social Security or Railroad Retirement Board benefits. Also, in order to take advantage of Medicare, you or your spouse must have worked and paid Medicare taxes for at least 10 years of your lives.

What if you’re working past 65 and losing your employer-provided health benefits?

When you decide to retire, you’ll need to make changes to your (and your spouse’s, if applicable) Medicare coverage. You probably already have Part A at this point, but you need to get supplemental coverage to make up for what used to be covered by your employer-provided health insurance.

If you’re beyond your IEP and are losing your employer-provided insurance outside of another enrollment period, like OEP or AEP, you’ll be eligible for a Special Enrollment Period (SEP). SEPs enable beneficiaries with extenuating circumstances to enroll in Medicare programs outside the typical enrollment periods.

The SEP for Parts A and B will last for eight months beginning the month after you lose your private health insurance benefits. The SEP for Parts C and D will last for two months beginning the month after you lose your private health insurance benefits. So, if you retire in March 2020, you’ll have between the months of April and November 2020 to enroll in Medicare Parts A and B and April and May to enroll in Medicare Parts C and D, if needed. Confused? Don’t worry, MySeniorHealthPlan.com is here to help.

What about Medicare Part B and D?

You may be aware of penalties for late enrollment in Medicare Part B and/or D. Since you’re covered by employer-provided health insurance during your IEP, you may be eligible for a Special Enrollment Period (SEP) to delay enrolling in Parts B and D.

You’ll have to consult with your employer to confirm eligibility.

With any health insurance decision, particularly those related to Medicare, we recommend you work with your employer’s plan administrator to understand what coverage you have, what coverage you need and how those options will change upon retirement.

If you need help or have questions about Medicare when working past 65, visit our website or call (877) 255-6273. You’ll talk to a knowledgeable member of our team who will help you navigate the Medicare system and find your best coverage options.

You may also seek assistance from Medicare by calling (800) MEDICARE (1-800-633-4227).

 

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Medicare Plans

Reinstating the Medicare Advantage “Open Enrollment Period”

by Jagger Esch
written by Jagger Esch

If you or a loved one receives Medicare coverage, you know how complicated and confusing enrollment periods can be. Enrollment periods are only confusing because the term “Open Enrollment Period” is used correctly and incorrectly to describe times when a plan change is possible

Reinstating “Open Enrollment Period”

The Medicare Advantage Open Enrollment Period was discontinued in 2010. In 2019, the OEP will make a return.

From 2011-2018 Medicare beneficiaries were given only the Medicare Advantage Disenrollment Period (MADP), during this time beneficiaries could disenroll from their Medicare Advantage plan and switch only to Original Medicare. Now all that is changing.

The Medicare OEP will begin on January 1st and end on March 31st. During this time Medicare beneficiaries can disenroll from a Medicare Advantage plan and enroll into another Medicare Advantage plan. You also have the option of switching back to Original Medicare, with or without Part D coverage.

It’s important for beneficiaries to know that they won’t be able to switch Part D prescription drug plans. If you are currently enrolled in a stand-alone Prescription Drug Plan you will need to change your policy during the Annual Enrollment Period from October 15 through December 7.

Medicare Supplement Open Enrollment Period

New terminology needs to be set up to make things easier for Medicare beneficiaries. It doesn’t need to be complicated, and it should be simplified.

The Medicare Supplement Open Enrollment Period is for Medicare beneficiaries that are new to Medicare Part B. This period lasts 6 months and begins on the first day of the month that you turn 65 or older and enrolled in Medicare Part B.

So, if you turn 65 on April 8 and don’t join Medicare until May 20, your Medicare Supplement Open Enrollment will start on June 1, which is the first day of the month in which you are both 65 and Enrolled in Medicare Part B.

Incorrectly Called “Open Enrollment Period”

The Annual Enrollment Period (AEP) happens every year from October 15 through December 7, this enrollment period is commonly called the Open Enrollment Period. It’s incorrect to refer to the AEP as the OEP, but people do.

When a Medicare beneficiary turns 65, they become eligible for the Initial Enrollment Period (IEP), this gives beneficiaries 7 months to enroll in a Medicare Advantage plan. IEP is commonly mistaken for an Open Enrollment Period. It’s clear that they are confusing the IEP with the Medicare Supplement Open Enrollment Period, while they are similar, they aren’t the same.

Other Coverage Changes in Medicare 2019

April of 2018, Medicare recipients will start to receive new Medicare ID cards that no longer have a Social Security number displayed on them. This is to help prevent fraud and identity theft among seniors. As required by the Medicare Access and CHIP Reauthorization Act (MACRA) all beneficiaries will have a new Medicare ID card by April 2019. The new cards will display a random ID number and you can shred the old card.

Then the Bipartisan Budget Act of 2018 (BBA 2018) will help close the donut hole one for brand-name drugs. This means that beneficiaries will only pay 25% of the cost of brand-name drugs. The cost of closing the donut hole for brand-name prescriptions is being shifted to the drug manufactures instead of insurance companies or beneficiaries.

So many good things are happening in 2019, it only makes sense that there is some less than desirable news. A new premium bracket for the highest-income Part B and Part D enrollees with go into effect. Under the BBA 2018 enrollees with an income of $500,000 or more ($750,000 for married couples) will pay a higher premium for Part B and Part D coverage.

Annually by September 30th, Medicare Advantage recipients will receive an Annual Notice of Change (ANOC) and Evidence of Coverage (EOC) from their existing insurance carrier for their Medicare Advantage and Medicare Prescription drug plan providers.

CMS shares plan changes for the following year in October, several months before the new year. Medicare.gov is an awesome resource for Medicare beneficiaries, you can use it to compare plans, look up information and learn more about Medicare.

 

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Why COBRA is Not Creditable Coverage
Health InsuranceMedicare

Why COBRA is Not Creditable Coverage

by Jagger Esch
written by Jagger Esch

What is COBRA?

COBRA, which is short for the Consolidated Omnibus Budget Reconciliation Act of 1985, is a federal law that requires any employer that has twenty or more employees and offers health coverage, must give the option to continue that coverage if the employee were to be in a situation in which they would lose the coverage; termination, reduction of hours, retirement, or certain other events. Why COBRA is Not Creditable Coverage
You should always check your local state laws for variations where different COBRA-like laws could apply.

What is covered by COBRA?

  • Coverages that you receive from an employer are generally covered by COBRA
  • Dental Coverage
  • Hearing Coverage
  • Health Care Coverage
  • Prescription Drug Coverage
  • Mental Health Coverage
  • Alcohol and Substance Abuse Coverage
  • Medical Spending Accounts
  • Vision Coverage

What is not covered by COBRA?

  • Retirement Plans
  • Disability Insurance
  • Vacation Plans
  • Life Insurance

How do I get COBRA?

Listed below are examples of qualifying events that would trigger COBRA

  • Reduction of hours of employment, (example: Going from full time to part time)
  • An employee’s death
  • Active Military Duty when you do not voluntarily have health coverage
  • Divorce or legal separation of a spouse that is covered from an employee
  • Aging into Medicare
  • Not returning to work at the end of FMLA(Family and Medical Leave) when coverage was in effect when the leave began and was lost while on leave
  • The employer going bankrupt
  • Termination of employment, voluntary or involuntary, unless it is for gross misconduct (COBRA does not define misconduct)

If COBRA is an extension of my employer coverage, why is it not creditable?

Creditable coverageis defined as health insurance, prescription drug, or other health benefit plan that meets a minimum set of qualifications. Group health plans, individual health plans, student health plans, as well as a variety of government-sponsored or government-provided plans are all types of creditable coverage plans.
One would think if the coverage is virtually the same as the coverage they had through the employer, it would be considered creditable. This statement makes sense but unfortunately it is not the case. Medicare does not consider COBRA creditable coveragewhen it comes to enrolling in Part B.
When you lose or leave your group coverage to go on Medicare you get a 8 month enrollment window to pick up Medicare Part B. You can elect COBRA if you are offered it, but you need to pick up Medicare Part B or you will be subject to a penalty.
The penalty for not picking up Part B when you have an enrollment period to do so is 10% for each consecutive 12 months you do not have coverage. The penalty stays with you for life and never goes away.

Can I pick up Medicare Part B at anytime if I miss my allotted time period?

If you do not pick up your Medicare Part B when you have the enrollment period available to you, you’ll have to wait until the General Enrollment Period (GEP). The General Enrollment Period starts on January 1stand continues until March 31stof every year.
When enrolling into Medicare Part B using the General Enrollment Period does not mean your Medicare Part B will start right away. When you use the GEP to sign up, your Part B will not start until July 1stof that same year.
This unfortunately happens to many seniors every year because they simply do not know.

But I just found this out now and my COBRA is ending?

Unfortunately if this happens to you there are not many options. You can see if there is an Affordable Care Act plan in your area to help you until you can get on your Medicare Part B. When this unfortunate case happens there are not many options, however you could consider a Hospital Indemnity, and a Critical Illness plan to help give some protection.
A Hospital Indemnity Plan, is a reimbursement coverage plan that will pay you for each day you are in the hospital, they can also pay you for doctor visits. You decide on a dollar amount you want or need in the event you must to go to the Hospital or doctor’s office and you pay the insurance company a monthly premium.
A Critical Illness plan is similar. These plans pay you out a lump sum tax free amount if you are diagnosed with a critical illness such as cancer, heart attack, or a stoke. The benefit amounts vary from as little as a $5000 benefit, up to $50,000 with most providers offering this coverage.
Regardless, if you fall into the situation of not having your Medicare Part B on time, these are important coverages to consider.
Nowadays half of all men and one third of all women are getting some form of cancer. The good news; we are living through it longer. The benefit payment amount does not have to be spent on medical expenses. You can use it for whatever you choose. Want to go to the best cancerspecialist? Then use it for travel and airfare. Want to see Rome? Enjoy your time abroad.

Why COBRA is Not Creditable Coverage

Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage

Why COBRA is Not Creditable Coverage

Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage Why COBRA is Not Creditable Coverage

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Our thoughts on how Medicare could be improved
Medicare Plans

Our thoughts on how Medicare could be improved

by Garrett Ball
written by Garrett Ball

How could Medicare improve eldercare benefits?

Medicare, by itself, is very good coverage, often much better than what most people are accustomed to as they age into Medicare. However, there is certainly room for improvement. Our thoughts on how Medicare could be improved
Some of the aspects of medical care that are not covered, such as dental, vision and hearing for example, have often been discussed as possibly being added in to basic Medicare’s coverage. That would certainly be an improvement to the coverage offered by “original” Medicare.
Other changes that would potentially improve benefits offered by Medicare are reductions in the amount of the Medicare deductibles and out of pocket costs. It’s difficult to see that change happening any time soon, however, and this is why the majority of people on Medicare purchase some sort of coverage in addition to Medicare.

What’s the biggest challenge seniors face when applying for Medicare?

The biggest challenge that seniors face when going on Medicare is confusion about Medicare benefits, deadlines and processes. Because of the enormous amount of information that seniors receive leading up to their 65thbirthday or retirement, many seniors are paralyzed by the fear of making the wrong choice or confused by the system itself.
In our experience, many people applying for Medicare do not understand how to start the process of applying Medicare. Those that are already receiving Social Security benefits are automatically enrolled into Medicare upon turning 65, so that does simplify the process for people in that situation. But for those that are not yet receiving Social Security benefits, it is a challenge to know what to enroll in and when they should enroll. There is not one document that seniors receive from Medicare that explains, in easy-to-understand terminology, the steps that one should take when applying for Medicare.
Additionally, this is even more complicated for seniors that are continuing to work past age 65 or are covered by a group insurance plan of some type. The decision of whether or not to take Medicare when they are first eligible is a decision that leads to confusion and can have potential long-term consequences.
Medicare has late enrollment penalties for Part B (medical coverage) and Part D (Rx coverage). So if a senior does not enroll on Medicare’s pre-determined time schedule, they can face these financial penalties, which are steep and stay with you in perpetuity.

Is there a medical service you or a loved one has needed that you thought Medicare would pay for and didn’t?

There are several medical services that are not covered by Medicare that can cause a problem for seniors and their families. Many people have the pre-conceived misconception that Medicare pays for everything. On the contrary, there are Medicare deductibles, coinsurance and co-pays that has spawned a whole industry of supplemental plans to fill in the Medicare “gaps”.
One of the areas that is not covered by Medicare is long-term care. We see this as a surprise to people on Medicare and their families because it is an area of care that so many seniors rely on later in life. However, Medicare itself does not cover nursing homes or custodial care. Now, there are insurance plans that you can purchase to cover that type of care, but these would, ideally, need to be purchased well before those benefits are actually needed.
Another medical service that is not covered by “original” Medicare is prescription drugs. Prescription drug coverage for Medicare beneficiaries is provided through Medicare Part D. This is always a separate plan, sold through a private company, and it must be signed up for separately (you are not automatically enrolled in prescription drug coverage in most situations). Also, if you delay enrollment into prescription drug Part D coverage, you may face higher premiums due to Medicare’s Part D late enrollment penalty.
Other medical care that is non-covered by Medicare are services for routine hearing, vision and dental care. There are some related aspects of these services that are covered, such as cataract surgery for example. But on the whole, routine care is not covered for hearing, vision or dental – this includes hearing aids, eyeglasses, and fillings, extractions, crowns, etc. You can purchase insurance to cover these things, but Medicare itself does not cover them.

Our thoughts on how Medicare could be improved

Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved Our thoughts on how Medicare could be improved

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