Why You Should Replace Your Medicare Advantage Plan with a Medicare Supplement

The Annual Enrollment Period (AEP), which is from October 15th through December 7th each year, is almost here!

If you currently have a Medicare Advantage (MA) plan, you should switch back to Original Medicare and get a Medicare Supplement plan instead!

IMPORTANT: If you have a Medicare Supplement plan (aka “Medigap” because it picks up the “gap” in Medicare coverage) the AEP does not apply to you unless you want to enroll in or change your Prescription Drug Plan (PDP).

Why Medicare Supplement Plans Are Better

With Original Medicare (Part A and Part B) and a Medicare Supplement, you have much more freedom of choice and lower costs than you do with an MA plan!

NOTE: Medicare Part A is hospital insurance and Part B is medical insurance.

Which Plan Gives You the Most Freedom?

With an MA plan, you are locked into the plan’s network of doctors, specialists, hospitals, and care facilities. If you want to see a specialist, you often have to see your preferred care provider first, who acts as a gatekeeper, before you can see a specialist within your network. If you want to see a specialist or doctor that is outside of your network, good luck! That will cost you a lot more in out-of-pocket (OOP) costs.

gatekeeper_

With a Medicare Supplement plan, you can go to ANY doctor, specialist, hospital, or care facility in the US as long as they accept Medicare!

For example, the MD Anderson Cancer Treatment Center in Texas accepts Medicare and therefore, they accept ALL Medicare Supplement plans. They don’t, however, accept most MA plans!

Which Plan Has Lower Out-Of-Pocket Costs?

With an MA plan, your OOP costs can be as high as $6,700 per calendar year and even higher if you go to doctors and/or care facilities that are outside of your network! With a Plan F or Plan G Medicare Supplement (the two best Medigap plans), the most you would normally pay in OOP costs in a calendar year is either $0 with Plan F or $183 with
Plan G!

out of pocket costs

NOTE: The $183 is the Medicare Part B (Medical) deductible, which is $183 per calendar year in 2017. That amount can change from year to year, but historically, it has always been very stable.

Maximum Out-Of-Pocket Costs for MA Plans in San Diego

The following data was obtained from the Medicare.gov website and shows the current OOP costs for MA plans in the 92009 zip code in San Diego. These costs currently range from $3,300 to $6,700 per calendar year!

If you go out-of-network with your MA plan, your OOP costs will be even higher!

Current (in-network) Maximum OOP Costs for MA Plans in the 92009 Zip Code:

  • AARP MedicareComplete SecureHorizons Essential (HMO) – $4,900
  • AARP MedicareComplete SecureHorizons Plan 4 (HMO) – $3,400
  • AARP MedicareComplete SecureHorizons Premier (HMO) – $4,300
  • AARP MedicareComplete SecureHorizons Value (HMO) – $5,300
  • Aetna Medicare Choice Plan (PPO) – $6,000
  • Aetna Medicare Select Plan (HMO) – $3,400
  • Anthem MediBlue Coordination Plus (HMO) – $6,700
  • Anthem MediBlue Plus (HMO) – $3,400
  • Blue Shield 65 Plus (HMO) – $3,400
  • Brand New Day Classic Care Drug Savings (HMO) – $3,400
  • Brand New Day Classic Choice for Medi-Medi (HMO) – $6,700
  • Care1st AdvantageOptimum Plan (HMO) – $3,400
  • Coordinated Choice Plan (HMO) – $6,700
  • Health Net Healthy Heart (HMO) – $3,400
  • Health Net Seniority Plus Sapphire (HMO) – $6,700
  • Health Net Seniority Plus Sapphire Premier (HMO) – $6,700
  • Humana Gold Plus H5619-016 (HMO) – $4,900
  • Humana Value Plus H5619-037 (HMO) – $6,700
  • Kaiser Permanente Senior Advantage San Diego (HMO) – $4,900
  • Scripps Classic offered by SCAN Health Plan (HMO) – $3,400
  • Scripps Plus offered by SCAN Health Plan (HMO) – $6,700
  • Scripps Signature offered by SCAN Health Plan (HMO) – $4,000
  • Sharp Direct Advantage Gold Card (HMO) – $3,400
  • Sharp Direct Advantage Platinum Card (HMO) – $3,300
  • Sharp SecureHorizons Plan by UnitedHealthcare (HMO) – $3,400

In contrast, in a calendar year, your maximum OOP costs are either $0 with a Plan F Medicare Supplement or $183 with a Plan G Medicare Supplement!

Is Your MA Plan’s Maximum OOP Costs Really No More Than $6,700 Per Year?

If you stay within your MA plan’s network, your maximum OOP costs are not supposed to be more than $6,700 per calendar year. However, if you go outside of the plan’s network, your OOP costs can be significantly higher than that!

Suppose that you get really sick and need expensive treatment such as Chemotherapy, etc. in the second half of the year. You could end up paying up to $6,700 (or whatever your plan’s maximum OOP cost is) by the end of the calendar year and guess what? Your OOP maximum zeros out in January, and it starts all over again!

If you are still receiving expensive medical care in the beginning of the year, you could potentially end up paying your maximum OOP cost two different times in a
12-month period! For example, if your maximum OOP cost is $6,700, your total OOP cost in a 12-month period, not a calendar year, could be more than $13,400!

Which Plan Has Lower Co-Payments?

If you have an MA plan, you will make a co-payment almost every time you go to the doctor, see a specialist, a physical therapist, etc. With most Medicare Supplement plans, there are no co-payments for doctor’s visits, etc.

Co Payment

How Difficult is it to Switch From an MA Plan to Original Medicare and a Medicare Supplement Plan?

That depends if you are in a Special Enrollment Period (SEP).

Special Enrollment Period

If you currently have an MA plan, and you are in a SEP, you can switch to Original Medicare and to any six of the 10 “standardized” Medicare Supplement plans any time of the year, REGARDLESS of your health.

The six “guaranteed issue” Medicare Supplement plans are plans A, B, C, F, K, and L. In other words, if you are in a SEP, you are guaranteed the right to get a Plan F Medicare Supplement, but not a Plan G supplement, etc.

NOTE: You could apply for Plan G, but you would be medically underwritten, and you could be turned down for certain medical conditions.

The 10 Standardized Medicare Supplement Plans

Nationwide, there are 10 “standardized” Medicare Supplement plans to choose from (Plans A through N). The term “standardized” means that the benefits and coverage for every Plan F, Plan G, etc. is exactly the same with every insurance carrier. Unlike MA plans, which are not standardized, it’s much easier to compare “apples with apples” with Medicare Supplement plans.

Medicare Supplement rates are not standardized. They vary significantly between insurance carriers. For that reason, it’s very important to shop around every year!

2017-Medicare-Supplement-Chart

NOTE: In the preceding chart, notice that the only difference between Plan F and Plan G is the $183 per calendar year Part B deductible.

SEP Situations

Here are some SEP situations that would guarantee you the right to switch back to Original Medicare and a Medicare Supplement plan:

  • The plan is leaving the Medicare program or stops service in your area.
  • You move out of the plan’s service area.
  • You leave the plan because the company has not followed certain rules or has misled you.
  • You decide to switch to Original Medicare within the first year of joining an MA plan when first eligible for Medicare Part A at age 65.

If you are in one of these situations, you cannot be turned down for Medicare Supplement insurance coverage, regardless of your health!

If You Are Not In a Special Enrollment Period

If you are not in a SEP, you will have to wait until the AEP (between October 15th and December 7th) to switch back to Original Medicare (Part A and Part B) on January 1st of the following year.

Although you can switch back to Original Medicare, there is no guarantee that you will be able to get a Medicare Supplement plan because you will be medically underwritten, and you must be in relatively good health to qualify for a Medicare Supplement plan.

If You Have Serious Health Conditions, You May Not Be Able to Get a Medicare Supplement Plan!

If you are not in a SEP and you are coming off of an MA plan during the AEP, you would normally have to meet minimum underwriting requirements to qualify for a Medicare Supplement plan, and you could be turned down for coverage.

If you live in California and you have serious health issues, more than likely, I can still get you a Medicare Supplement without having to answer any medical questions on the application! Call me for more details!

The Pros and Cons of MA Plans and Medicare Supplement Plans

Is there really an advantage to having a Medicare Advantage plan? Let’s take a look at the pros and cons of each, and you can decide for yourself.

Pros-and-Cons-of-Alternative-Lending

MA Plan Advantages

Here are some benefits of having an MA plan:

  1. MA premiums can be very low, and some plans have no monthly premiums at all.
  2. Some MA plans include Medicare prescription drug coverage (Part D).
  3. Maximum OOP costs are “limited.” Plans vary, but in 2017, the most you can pay in OOP costs is $6,700 per calendar year. (I wouldn’t really call this a “benefit” since $6,700 is a lot of money! With a Plan F Medicare Supplement, you won’t pay any OOP costs!)
  4. Some MA plans offer additional benefits such as vision, hearing, dental, and other health and wellness programs. (Note that some Medicare Supplement plans also offer additional benefits such as free gym memberships, vision, and hearing aid benefits.)

Medicare Supplement Plan Advantages

Here are some benefits of having a Medicare Supplement plan:

  1. You have much more FREEDOM of choice with a Medicare Supplement than you do with an MA plan because you can go to ANY doctor, hospital, specialist, or care facility in the United States as long as they accept Medicare. (You can’t do that with an MA plan.)
  2. You have much for financial stability with a Medicare Supplement than an MA plan because there are no unexpected spikes in costs and OOP expenses for co-payments, hospitalizations, surgeries, chemotherapy, etc.
  3. With a Plan F or Plan G Medicare Supplement, other than your premiums, your maximum OOP costs in a calendar year will be either $0 (Plan F) or $183 (Plan G) per calendar year in 2017. With an MA plan, your maximum OOP costs can be as high as $6,700 per calendar year!
  4. Chemotherapy is very expensive. With an MA plan, you have to pay the entire 20% Medicare Part B co-payment for chemotherapy, which can cost thousands of dollars. With a Plan F or Plan G Medicare Supplement, the most you will pay for Chemotherapy is either $0 (Plan F) or $183 (Plan G)!
  5. You are not limited to a specific geographic region or a restrictive network of doctors, hospitals, specialists, care facilities, etc. like you are with an MA plan. With most MA plans, you must use their providers or you may pay more or all of the costs if you go out of their network.
  6. With a Medicare Supplement, you can go directly to the specialist of your choice, ANYWHERE in the United States, as long as they accept Medicare. With most MA plans, you must go through your primary care doctor first (the “gatekeeper”) before you can see a specialist within your network.
  7. There are no HMO or PPO plans or networks with Medicare Supplements. If you have an MA plan and you go to a doctor, other health care provider, facility, or supplier that doesn’t belong to the plan’s network for non‑emergency or non-urgent care services, your services may not be covered, or your costs could be higher.
  8. If you want to go to a renowned treatment center such as the MD Anderson Cancer Treatment Center in Texas, you can do so with any Medicare Supplement, as long as they accept Medicare. You can’t do that with most MA plans.
  9. If you move to another part of the country, you can keep your Medicare Supplement, but you cannot keep your MA plan if you move out of your network.
  10. There are only 10 “standardized” Medicare Supplement plans to choose from, (Plan A through Plan N). Since Medicare Supplements are standardized, the coverage and benefits for every Plan F, Plan G, etc. is exactly the same with every insurance carrier, so it’s much easier to shop around and compare “apples with apples.” MA plans are not standardized, and the co-payments, deductibles, out of pocket costs, etc. vary significantly between MA plans, and they change every year making them unnecessarily complicated and confusing.
  11. Your Medicare Supplement plan cannot be cancelled as long as you pay your premiums. MA plans are annual contracts, and they can be cancelled or benefits changed at the end of each calendar year.
  12. There are no provider networks with Medicare Supplements. With MA plans, providers can join or leave a plan’s provider network anytime during the year meaning that you could have to start shopping around for a new doctor while simultaneously undergoing Chemotherapy or other specialized medical treatments.
  13. There is no AEP for Medicare Supplements, and you don’t have to shop around every year and make sure that your coverage, co-payments, co-insurance, deductibles, and benefits haven’t changed since the previous year. If there are any Medicare changes from one calendar year to the next, your Medicare Supplement will automatically pay the difference.
  14. You can travel around the US for as long as you want (or even move to a different geographic location), and your Medicare Supplement cannot be cancelled for leaving your “service area.” With most MA plans, if you travel outside of the MA plan’s service area for more than six months, you could be disenrolled from the plan.
  15. With most Medicare Supplements, there are no co-payments when you go to the doctor. With most MA plans, you have to pay co-payments when you go to the doctor.
  16. With Medicare Supplements, pre-certification is not required for surgeries, etc. as long as the procedure is “medically necessary.” With most MA plans, pre-certification is required for surgeries or before getting expensive treatments.
  17. You can switch Medicare Supplement plans or insurance carriers any time of the year as long as you meet minimum health and underwriting requirements. With an MA plan, you can only join or leave an MA plan during the AEP. Otherwise, you are locked into your plan for the entire calendar year, except for certain circumstances, such as moving out of your plan’s service area, etc.)

As you can see, you are much better off with a Medicare Supplement plan than you are with a Medicare Advantage plan!

Conclusion

If you currently have a Medicare Advantage (MA) plan, you have given up your Original Medicare rights that you have worked so hard for, and you are compromising your freedom to go to the best doctors, hospitals, specialists, neurosurgeons, care facilities, etc. in the United States.

I would strongly urge you to switch back to Original Medicare and get a Medicare Supplement plan during the upcoming AEP, between October 15th and December 7th)! Contact me TODAY for more information or a free quote!

As an independent insurance agent specializing in Medicare Supplements, I work with ALL of the major insurance carriers, not one particular company. I will shop around for you, every year, and save you money on your Medicare Supplement insurance!

If you live in California and you have a serious medical condition, more than likely, I can still get you a Medicare Supplement at a competitive price without answering any of the health questions on the application!

I hope that you have found this article to be helpful and informative. Please feel free to forward this article to anyone who may be interested.

Your comments and feedback are appreciated! If you have any questions, please contact me… I’m always happy to help!

Thank you!

Ron Lewis
www.MedigapExpress.com
Ron@RonLewisInsurance.com
866.718.1600 (Toll-free)

Medicare Advantage Plans – Do the Advantages Outweigh the Disadvantages?

The Annual Enrollment Period (AEP) for signing up for a Medicare Advantage (MA) plan or or a Prescription Drug Plan (PDP) is here, and it goes from October 15th through December 7th each year. During this period, many “seniors” have to make choices regarding their health care for the following year.

NOTE: If you have a Medicare Supplement, the AEP does not apply to you unless you want to enroll in or change your PDP.

If you want to change to a different MA plan in 2017, or if you want to leave your MA plan and switch back to Original Medicare, you must do so during the AEP each year. The new coverage will begin on January 1st of the following year. In most cases, you must stay enrolled in your MA plan for the calendar year beginning in January or on the date your coverage begins. However, in certain situations, you may be able to join, switch, or drop an MA plan during a Special Enrollment Period (SEP), such as if you move out of your plan’s service area, etc.

open-enrollment

Pros and Cons – Medicare Supplements Versus Medicare Advantage Plans

When it comes to Medicare Advantage (MA) plans, I’m going to be totally honest and admit right now that I am biased because I don’t like them! I realize that most people who are on Medicare are retired and on fixed incomes, but unless you literally can’t afford to pay the monthly premium for a Medicare Supplement (also known as Medigap), I would never recommend or advise someone to give up their Original Medicare rights and sign up for an MA plan!

Now that we are in the AEP, if you currently have an MA plan, or if you are thinking about signing up for one, I would strongly recommend that you read this article so that you can make an informed decision about whether an MA plan is right for you and in your best financial interest.

There are pros and cons to each, but the Medicare Supplement benefits are significantly greater than the MA plan benefits as demonstrated below.

medicare-advantage-vs-medigap-boxes

MA Plan Advantages

Here are some benefits of having an MA plan:

  • MA premiums can be very low, and some plans have no monthly premiums at all.
  • Some MA plans include Medicare prescription drug coverage (Part D).
  • Maximum out-of-pocket (OOP) costs are limited. Plans vary, but in 2017, the most you can pay in OOP costs is $6,700 per calendar year. (I wouldn’t really call this a benefit since $6,700 is a lot of money, and the most you would pay in OOP costs with a Plan F or Plan G Medicare Supplement is $0 (Plan F) or $166 (Plan G) per calendar year in 2016!)
  • Some MA plans offer additional benefits such as vision, hearing, dental, and other health and wellness programs. (Some Medicare Supplement plans also offer additional benefits such as free gym memberships, vision, and hearing aid benefits.)

Medicare Supplement Plan Advantages

Here are some benefits of having a Medicare Supplement plan:

  • You have much more FREEDOM of choice with a Medicare Supplement than you do with an MA plan because you can go to ANY doctor, hospital, specialist, or care facility in the United States as long as they accept Medicare. (You can’t do that with an MA plan.)
  • You have much for financial stability with a Medicare Supplement than an MA plan because  there are no unexpected spikes in costs and OOP expenses for co-payments, hospitalizations, surgeries, chemotherapy, etc.
  • With a Plan F or Plan G Medicare Supplement, other than your premiums, your maximum OOP costs in a calendar year will be either nothing (Plan F) or no more than $166 (Plan G) per calendar year in 2016. With an MA plan, your maximum OOP costs can be as high as $6,700 per calendar year in 2016 and 2017!
  • Chemotherapy is very expensive. With an MA plan, you have to pay the entire 20% Medicare Part B co-payment for chemotherapy, which can cost thousands of dollars. With a Plan F or Plan G Medicare Supplement, the most you will pay for Chemotherapy  is either nothing (Plan F) or $166 (Plan G) per calendar year (in 2016)!chemo-cost2
  • You are not limited to a specific geographic region or a restrictive network of doctors, hospitals, specialists, care facilities, etc. like you are with an MA plan. With most MA plans, you must use their providers or you may pay more or all of the costs if you go out of their network.
  • With a Medicare Supplement, you can go directly to the specialist of your choice, ANYWHERE in the United States, as long as they accept Medicare. Most HMO MA plans require you to go through a primary care doctor first before you can see a specialist within their geographic network.
  • There are no HMO or PPO plans or networks with Medicare Supplements. If you have an MA plan and you go to a doctor, other health care provider, facility, or supplier that doesn’t belong to the plan’s network for non‑emergency or non-urgent care services, your services may not be covered, or your costs could be higher.
  • If you want to go to a renowned treatment center such as the MD Anderson Cancer Treatment Center in Texas, you can do so with a Medicare Supplement, as long as they accept Medicare. You can’t do that with most MA plans.
  • If you move to another part of the country, you can keep your Medicare Supplement, but you cannot keep your MA plan if you move out of your network.
  • There are only 10 “standardized” Medicare Supplement plans to choose from,  (Plan A through Plan N). Since Medicare Supplements are standardized, the coverage and benefits for every Plan F, Plan G, etc. is exactly the same with every insurance carrier, so it’s much easier to shop around and compare “apples with apples.” MA plans are not standardized, and the co-payments, deductibles, out of pocket costs, etc. vary significantly between MA plans, and they change every year making them unnecessarily complicated and confusing.
  • Your Medicare Supplement plan cannot be cancelled as long as you pay your premiums. MA plans are annual contracts, and they can be cancelled or benefits changed at the end of each calendar year.
  • There are no provider networks with Medicare Supplements. With MA plans, providers can join or leave a plan’s provider network anytime during the year meaning that you could have to start shopping around for a new doctor while simultaneously undergoing Chemotherapy or other specialized medical treatments.
  • There is no AEP for Medicare Supplements, and you don’t have to shop around every year and make sure that your coverage, co-payments, co-insurance, deductibles, and benefits haven’t changed since the previous year. If there are any Medicare changes from one calendar year to the next, your Medicare Supplement will automatically pay the difference.
  • You can travel around the US for as long as you want (or even move to a different geographic location), and your Medicare Supplement cannot be cancelled for leaving your “service area.” With most MA plans, if you travel outside of the MA plan’s service area for more than six months, you could be disenrolled from the plan.
  • With most Medicare Supplements, there are no co-payments when you go to the doctor. With most MA plans, you have to pay co-payments when you go to the doctor.
  • With Medicare Supplements, pre-certification is not required for surgeries, etc. as long as the procedure is “medically necessary.” With most MA plans, pre-certification is required for surgeries or before getting expensive treatments.
  • You can switch Medicare Supplement plans or insurance carriers any time of the year as long as you meet minimum health and underwriting requirements. With an MA plan, you can only join or leave an MA plan during the AEP. Otherwise, you are locked into your plan for the entire calendar year, except for certain circumstances, such as moving out of your plan’s service area, etc.)

As you can see from the facts mentioned above, there really aren’t many advantages to having a Medicare Advantage plan.

The 12-Month Medicare Advantage “Trial Right” Period

During the AEP, you can join an MA plan even if you have pre-existing medical conditions, except for End-Stage Renal Disease (ESRD). You have a 12-month period to try out an MA plan. If you later change your mind or are dissatisfied, you can disenroll from the plan anytime during that first 12 months, prior to the one-year anniversary of the effective date. You can rejoin Original Medicare, and still have a guaranteed issue right to purchase a Medicare Supplement policy. During this period, the insurance carrier cannot deny you coverage, regardless of your health.

WARNING: If you have had an MA plan for longer than a year and you want to switch back to Original Medicare, you may do so during the AEP. However, if you have developed serious health issues, you probably won’t be able to get a Medicare Supplement because they are medically underwritten, and you must be in relatively good health to qualify for one!

If you have serious health issues and you want to switch back to Original Medicare and get a Medicare Supplement, let me know because there are some “tricks” that I’m aware of to get around this!

Are Some Medicare Advantage Plans Really Free?

Because some MA plans have very low monthly premiums or no monthly premiums at all, some unscrupulous insurance agents promote them as “FREE” Medicare insurance plans, which is inaccurate, misleading, and, in my opinion, downright unethical. And some of these agents erroneously argue that MA plans cost less than traditional Medicare Supplement plans, which could be argued if you are healthy and rarely go to the doctor, BUT the real purpose for having health insurance is for the “worst-case scenario” and to protect your financial assets against unexpected catastrophic costs.

medicare-advantage-pig

If your health should eventually change and you develop a serious illness, you will wish that you had a Medicare Supplement instead of an MA plan! These agents are providing a disservice to their clients because they are subjecting them to potentially HUGE and unexpected out-of-pocket costs that can literally cost their clients many thousands of dollars!

Maximum Out-Of-Pocket Costs for MA Plans in San Diego

In San Diego, the maximum OOP costs for MA plans currently range from $3,300 to $6,700 per calendar year!

NOTE: If you go out-of-network with your “free” MA plan, your OOP costs will be even greater!

SOB-0006 6700

The following data was obtained from the Medicare.gov website and shows what the current OOP costs are for these “free” MA plans in San Diego:

  • AARP MedicareComplete SecureHorizons Essential (HMO) – $4,900
  • AARP MedicareComplete SecureHorizons Plan 4 (HMO) – $5,900
  • AARP MedicareComplete SecureHorizons Premier (HMO) – $4,300
  • AARP MedicareComplete SecureHorizons Value (HMO) – $5,300
  • Aetna Medicare Choice Plan (PPO) – $6,700
  • Aetna Medicare Select Plan (HMO) – $3,400
  • Anthem MediBlue Coordination Plus (HMO) – $6,700
  • Anthem MediBlue Plus (HMO) – $3,400
  • Blue Shield 65 Plus (HMO) – $3,400
    Care1st AdvantageOptimum Plan (HMO) – $3,400
  • Coordinated Choice Plan (HMO) – $6,700
  • Health Net Healthy Heart (HMO) – $5,000
  • Health Net Seniority Plus Sapphire (HMO) – $6,700
  • Health Net Seniority Plus Sapphire Premier (HMO) – $6,700
  • Humana Gold Plus H5619-037 (HMO) – $6,700
  • Humana Gold Plus H5619-016 (HMO) – $4,900
  • Kaiser Permanente Senior Advantage San Diego (HMO) – $4,400
  • Scripps Classic offered by SCAN Health Plan (HMO) – $3,400
  • Scripps Plus offered by SCAN Health Plan (HMO) – $6,700
  • Scripps Signature offered by SCAN Health Plan (HMO) – $4,000
  • Sharp Advantage Select (HMO) – $3,500
  • Sharp Advantage Select Plus (HMO) – $3,300
  • Sharp SecureHorizons Plan by UnitedHealthcare (HMO) – $3,400

2016-ma-chart

Is the Maximum OOP Cost Really No More Than $6,700 Per Year?

Depending on which MA plan you have in San Diego County, the most you would pay for OOP costs in 2017 is $6,700 per calendar year! If you go outside of your plan’s network,  you could end up paying even more than that!

Now suppose that you get really sick and need expensive treatment such as Chemotherapy, etc. in the second half of the year. You could end up paying up to $6,700 (or whatever your plan’s maximum OOP cost is) by the end of the calendar year and guess what? Your OOP maximum zeros out in January, and it starts all over again!

If you are still receiving expensive medical care in the beginning of the year, you could potentially end up paying your maximum OOP cost TWICE in a 12-month period! For example, if your maximum OOP cost is $6,700, your total OOP cost in a 12-month period, not a calendar year, could be as much as $13,400 with your “free” MA plan!

Do Medicare Advantage Plans Really Cost Less Than Medicare Supplement Plans?

In California, Medicare Supplement rates are based primarily on your age and zip code. Plan F and Plan G are the two best and most popular Medicare Supplement plans.

Plan F pays for ALL of the co-payments, deductibles, and co-insurance that is not covered by Medicare, and with Plan F, there are no OOP costs other than the monthly premiums.

Plan G is identical to Plan F in every way except you would have to pay the small Part B (Medical) deductible, which is presently $166 per calendar year in 2016. That is the only difference between the two plans! With Plan G, the most you will pay in OOP costs is $166 per calendar year other than the monthly premiums.

NOTE: The Part B medical deductible can change from year to year, but historically, it has been very stable. My Obamacare medical deductible is over $5,000 per calendar year! I’m 64, and I can’t wait to sign up for Plan G next year so I will only have to pay $166 per calendar year for my deductible! As far as I’m concerned, if the Plan G medical deductible was $500, it would still be a great deal!

Many people who had Plan F have switched to Plan G because the premiums are less, and it’s usually more cost effective, even if you pay for the $166 Part B deductible yourself!

plan-g

For example, in the San Diego area, a 70 year old can purchase Plan G for under $140 per month ($1,680 per year). Again, with Plan G the most you would pay for OOP costs in 2016 would be $166 per calendar year!

In this example, if you have a Plan G Medicare Supplement and you are paying $1,680 per year for your annual premiums plus the $166 Part B medical deductible, your total annual cost is $1,846 per year ($1,680 + 166 = $1,846)!

So, for $1,846 per year, you would have the total FREEDOM to go to ANY doctor, hospital, specialist, or care facility in the United States (as long as they accepted Medicare), AND 100% of your Medicare co-payments, deductibles, and co-insurance costs would be paid for, AND you would not have to pay the 20% co-payment for Chemotherapy that is not covered by Medicare or your MA plan if you needed it, AND, in the worst case scenario, you would have no other OOP costs or expenses for required medical care or treatment!

In comparison, if you had a “free” MA plan, and your maximum OOP cost is $6,700 per year, you could have saved up to $4,854 per year if you had signed up with a Plan G Medicare Supplement plan instead ($6,700 – 1,846 = $4,854)!

Conclusion

For the reasons mentioned above, I hope that I have convinced you that you are much better off with a Medicare Supplement plan. If you sign up with an MA plan, you give up your Original Medicare (Part A and Part B) rights and compromise your freedom to go to the best doctors, hospitals, specialists, neurosurgeons, care facilities, etc. in the United States.

There is no such thing as free Medicare insurance! As the old expression goes… “You get what you pay for!”

you-get-what-you-pay-for

If you currently have a Medicare Advantage plan or if you are thinking about getting one, I strongly advise and recommend that you sign up for a Medicare Supplement plan instead! If you need more information or want to compare prices, please let me know!

Also, if you liked this blog, and found it informative, please click the “Like” button, and please feel free to share it with your friends!

Thank you!

Ron Lewis

Ron@RonLewisInsurance.com
http://www.RonLewisInsurance.com
(760) 525-5769 – Cell
(866) 718-1600 – Toll-free

As an independent insurance agent specializing in Medicare Supplements, I work with ALL the major insurance carriers in California and certain states in the US., and I represent my clients, not a particular insurance company. Since rates vary significantly from one insurance carrier to the next for the same identical plan and coverage, and since they are continuously changing, it’s important to shop around periodically to make sure that you aren’t paying too much for your premiums. I shop around for my clients EVERY YEAR, and I’m happy to do the shopping for you too!

If you or someone that you know would like Medicare Supplement information or a free quote, please let me know. If you know anyone that might enjoy reading this blog, please feel free to forward it on to them! And please send me your questions, comments, or feedback!

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Medicare Supplements – Why Pay Wholesale When You Can Pay Retail?

Yes, you read the title correctly. When it comes to Medicare Supplement plans, which are also known as Medigap plans because they pay for the “gaps” in coverage that are not paid for by Medicare, some of my clients prefer to pay retail instead of wholesale! That’s right, “Why pay less when you can pay more?”

retail

Most people that I meet are very happy to save a lot of money on their insurance premiums, but there are always some that really don’t seem to care. Or maybe they are skeptical because it just “seems too good to be true,” which I can totally understand.

A Tale of Two Cities, I Mean Two Clients…

I was working with two different clients yesterday, Client “A” and Client “B.”

two clients

Client “A”

Client “A” has Plan F with Blue Shield of CA, and his monthly premium is $279 per month. I shopped around for him and found several other insurance carriers that are offering Plan F at much lower rates. The lowest rate that I found for him is $179.33 per month. That is a savings of $99.67 per month or $1,196.04 per year for the same identical plan and coverage!

Many people who have Plan F have been switching to Plan G because both plans are identical except there is no deductible with Plan F, and there is a small $166 (Part B) deductible with Plan G. That is the only difference between the two plans!

However, Plan G is usually much more cost effective (cheaper) because the rates are lower. So even if you pay the $166 deductible, in most cases, you still end up spending much less money with Plan G than Plan F.

In addition to getting the current Plan F rates for Client “A,” I also provided him with the current Plan G rates for comparison. If he switched from Plan F to Plan G, he would have saved even more money! The best Plan G rate is $156.70 per month. That would be a gross savings of $122.30 per month or $1,467.60 per year! If he spent the $166 deductible, his net savings would still be $1,301.60 per year! In this particular case, Client “A” would have saved even more money by switching from Plan F to Plan G.

Inexplicably, Client “A” decided to keep his current plan for another year!

Client “B”

Client “B” also has Plan F with Blue Shield of CA, and her rate is $219 per month. I shopped around for her and, like Client “A,” I found several other insurance carriers that are also offering Plan F at much lower rates. The lowest rate that I found for Client “B” is $170.99 per month. That is a savings of $48.01 per month or $576.12 per year for the same identical Medicare Supplement plan and coverage!

Client “B” also had the option to switch from Plan F to Plan G, and again, she would have saved even more money on her premiums by doing so. Her current Plan F rate is $219 per month, and the best Plan G rate for her is $147.19 per month. That would be a gross savings of $71.23 per month or $854.76 per year! If she spent the entire $166 deductible, her net savings per year would still be $688.76 per year!

Just like Client “A,” Client “B” also decided to keep her current plan for another year!

Some Common Misconceptions

It’s very baffling to me when I can literally save someone hundreds and even thousands of dollars a year on their premiums for the same exact plan and coverage, and for whatever reason they are not interested in doing so.

If my auto and homeowner’s insurance agent told me he could save me $100 a month on my premiums, I would be thrilled to be able to save that much money. I guess that some people just aren’t as happy about saving money as I am!

Save-Money

Misconception #1 – By Switching Medigap Plans, I Won’t Be Able to Go to the Same Doctors

Some people are reluctant to change Medigap plans because they are afraid that they won’t be able to continue seeing the same doctors. This is a misconception because you can go to ANY doctor or hospital in the US with your Medicare Supplement as long as the doctor or hospital accepts Medicare. If your doctor accepts your current Medicare Supplement plan, then they have to accept ANY Medigap plan or insurance carrier that you have, PERIOD.

Misconception #2 – The Rates Are Too Good to Be True

If the new rates are significantly lower than the current plan, some people think it’s either too good to be true or a huge rate increase is soon to follow. This is also a misconception because most of the carriers that I work with lock in their rates for the first 12 months, so there wouldn’t be any unexpected rate increases.

Misconception #3 – My Coverage Will Not Be the Same

Another common misconception is that the coverage will not be the same, even if someone is switching from Plan F to Plan F or Plan G to Plan G, etc. There are 10 “standardized” plans to choose from, Plan A through Plan N. This means that the coverage for every standardized plan is exactly the same with every insurance carrier. So if someone has Plan F with Blue Shield and they want to switch to Plan F with Mutual of Omaha, etc., the coverage is exactly the same. Plan F is Plan F is Plan F…Period!

One of the other reasons people don’t want to switch their Medicare Supplement plan is because they fear change. “Everything has been going great so far. Even though the rates are cheaper and the coverage is the same, why take a chance by going with a different carrier?”

If you decide to switch carriers, the transition is seamless. Your coverage with the first insurance carrier will end at the end of the month, and the new coverage begins on the 1st of the following month. There are no forms or paperwork to fill out. When you go to the doctor after your new coverage begins, they will make a copy of your new Medicare Supplement card, and after that, everything will be the same as before.

The California Birthday Rule

In California, there is a law called the California Birthday Rule. If you have a Medicare Supplement, you are lucky to live in California for more reasons than just the beautiful weather and the great beaches!

happy-birthday

This law guarantees you the right to switch insurance carriers, EVERY YEAR, within 30 days of your birthday (before or after) REGARDLESS OF YOUR HEALTH and without answering any health questions on the application! This is known as your annual open enrollment period. If another insurance carrier is offering the same plan that you currently have, or if they are offering another plan that has fewer benefits, you are guaranteed the right to switch carriers every year if you want to, and you cannot be turned down due to health reasons.

For example, if you have Plan F and another carrier is offering Plan F for a lower rate, you are guaranteed the right to switch to the other carrier every year around your birthday, without answering any health questions on the application. Likewise, you are guaranteed the right to switch to a plan with fewer benefits as well. So if you have Plan F, which has the most comprehensive coverage, you could switch to Plan G if you want to because Plan G has fewer benefits than Plan F.

NOTE: Under the California Birthday Rule, if you have Plan F, you can switch to any other plan, but if you have any other plan, you cannot use the California Birthday Rule to switch to Plan F because it has more benefits than any other plan.

You can actually switch insurance carriers or plans any time of the year, but if you do so at any time other than during the 30 days before or after your birthday, you will have to answer the health questions on the application, you will be medically underwritten, and you could be turned down for coverage due to medical reasons. If you have any serious health conditions, you should apply during the 30 days before your birthday!

In most other states, there isn’t a birthday rule. That means that once you sign up, if you later develop any serious health issues, you would have to meet minimum health and underwriting requirements if you wanted to change your Medicare Supplement plan or your insurance carrier. If your insurance rates increased significantly, you could be stuck paying very high premiums for many years! In California, that would never happen because you can always change your insurance every year around your birthday, regardless of your health!

Rates Vary Significantly Between Insurance Carriers For the Same Identical Plans and Coverage

In California, rates are based on “attained age,” which means that your rates are based on your current age, and they usually go up in price every year as you get older. As mentioned before, there are 10 “standardized” Medicare Supplement plans to choose from, Plan A through Plan N. When I say “standardized,” that means that the coverage for Plan F, Plan G, etc. is exactly the same no matter which insurance carrier that you are with.

Although the coverage is exactly the same with every insurance carrier, the rates (prices) vary significantly between insurance carriers!

dollars

For example, in the 92056 zip code the Plan F rates for a 72 year old man range in price from $164.06 to $278.86 per month! That is a difference of $1,377.60 per year for the same exact plan and coverage! In other words, some 72 year old individuals in the 92056 zip code are paying $164.06 per month for their Plan F coverage while others are paying $278.86 per month for their Plan F coverage!

Examples of How I Recently Saved Clients Money By Switching From Plan F to Plan F

Here are some examples of how I took advantage of the California Birthday Rule and saved my clients a lot of money on their annual premiums by switching them from Plan F with one carrier to Plan F with a different carrier:

  • $142.08
  • $257.64
  • $334.08
  • $338.64
  • $349.68
  • $432.84
  • $498.24
  • $501.78
  • $501.78
  • $516.96
  • $536.76
  • $879.84
  • $1,003.56

Examples of How I Recently Saved Clients Money By Switching From Plan F to Plan G

Here are some other examples of how I took advantage of the California Birthday Rule and saved my clients a lot in their annual premiums by switching them from Plan F with one carrier to Plan G with a different carrier:

  • $203.12
  • $278.96
  • $349.16
  • $425.48
  • $462.68
  • $600.00

Although it’s not the norm, the most I have ever saved one of my clients, a married couple, was over $5,300 per year just by switching from Plan G with one insurance carrier to Plan G with a different insurance carrier! As you can see, it’s really important to shop around and compare rates!

Sometimes I Feel Like “I Get No Respect!”

Once in a while, however, I feel like Rodney Dangerfield because “I get no respect!” Most of my clients are 65 or over and many are retired and on fixed incomes. The majority are very receptive to saving money on their insurance premiums, but once in a while, I have to practically beg people to let me save them hundreds and even thousands of dollars a year on their premiums, and quite honestly, that drives me crazy!

Rodney_Dangerfield2

For whatever reasons, some people, like Client “A” and Client “B,” are apparently not so budget conscious. I was very excited and happy to tell them how much money I could save them, and their response was basically “Let me think about it!”

Think about it? Really? What is there to think about! It seems to me that it’s pretty much a no-brainer. I can hear them now. “Do I want to save $1,200 per year on my premiums for the same exact plan and coverage? Hmm, this is really a tough one. What am I going to do with an extra $100 a month? This might complicate my taxes! Eh, who needs this kind of stress and aggravation!”

stress

I don’t want any of my clients to feel stressed or aggravated! If you’re one of those individuals that prefer to pay wholesale instead of retail, instead of the other way around, please don’t hesitate to contact me if you have any questions or if I can help in any way. If you’d like me to, I’m happy to do the shopping for you, EVERY YEAR, to save you money on your Medicare Supplement insurance!

NOTE: Although this article focuses primarily on Medigap plans in California, I am licensed and work with Medicare Supplement insurance plans outside of California as well. If you need premium rates for other states, I am happy to provide you with that information as well.

If you or someone that you know would like a free quote, please let me know. If you know anyone that might enjoy reading this blog, please feel free to forward it on! And please feel free to send me any of your questions, comments, and feedback!

Thank you,

Ron Lewis

How to Use the Medicare.gov Website to Purchase a Prescription Drug Plan

The Medicare open enrollment period just started, and it goes from October 15th through December 7th. During this period, you can choose a Prescription Drug Plan (PDP) that will begin on January 1st, 2016. Many people are confused because they don’t know how to shop around for a PDP. You don’t have to be an “expert” or a rocket scientist to purchase your own PDP. The purpose of this blog is to help you save money on your insurance premiums and find a PDP that is right for you.

IMPORTANT If you decide not to join a Medicare drug plan when you’re first eligible, and you don’t have other creditable prescription drug coverage, and you don’t get Extra Help, you’ll likely pay a late enrollment penalty if you join a plan later.

Medicare SimplifiedAccessing the Medicare.gov Website

If you have access to a computer and the Internet, shopping around for a PDP is really quite easy. If you’re ready to begin, follow these steps:

1.)  Navigate to the Medicare.gov website.

PDP1-0003x2.)  Under the blue tab at the top left-side of page that says Sign Up/Change Plans, click Find health & drug plans.

PDP1-0004xThe Medicare Plan Finder page displays.

PDP3-0001x3.)  In the General Search section, enter your zip code and click Find Plans. The Step 1 of 4 page displays.

NOTE If a survey window displays, close it and continue.

PDP1-0007x4.)  In the first section, select Original Medicare, and in the second section, select I don’t get any Extra Help. After that, click Continue to Plan Results. The Step 2 of 4 window displays.

NOTE You can choose other options that are more appropriate for your situation.

PDP1-0009x5.)  Enter your prescriptions in the text box and choose the appropriate dosages for each. A window, similar to the following, displays.

PDP1-0010x6.)  After you select the appropriate prescription dose, click Add drug and dosage.

NOTE: Continue adding your prescriptions until your prescription drug list is complete. You can add up to 25 prescriptions, and you can see your list in the lower part of the window. You can also choose “mail order pharmacy” to have your prescriptions mailed to you. In some instances, it is more cost effective to do that. If you select “mail order pharmacy,” information for both retail pharmacies and mail order options will display.

7.)  Write down the Drug List ID number AND the Password Date on a separate piece of paper.

NOTE The prescriptions, dosages, etc. that you entered are saved, and you can enter this number and the date later on to retrieve your prescription information instead of reentering it again.

Medigap PDP Window2x8.)  Click My Drug List is Complete when your drug list is complete. The Step 3 of 4 window displays.

PDP1-0014x9.)  Click Add Pharmacy to add up to two pharmacies, and then click Continue to Plan Results. The Step 4 of 4 window displays.

NOTE You can click the drop-down menu at the top of the page to select from more pharmacies near your zip code.

PDP3-0002x10.)  Click the check box next to Prescription Drug Plans (with Original Medicare), and then click Continue to Plan Results. The Your Plan Results window displays.

PDP1-0019NOTE By default, the prescription drug plans are sorted from the lowest to highest estimated annual retail drug cost. In the Plan Results window, click View All to see all the plans.

Understanding the Plan Results Window

After you access the Plan Results window, you are ready to evaluate and compare prescription drug plans and decide which plan is best for you.

There are different variables to take into consideration when choosing a PDP. Here are some of the more important ones:

  • Are drugs on the formulary?
  • Drug restrictions
  • Estimated annual drug costs
  • Annual drug deductible
  • Monthly premium
  • Overall star rating of the company

Are Drugs on the Formulary?

If a drug is not on the PDP formulary, that means that the plan does not offer coverage for that specific drug, and you should continue looking at other plans.

Drug Restrictions

If there are drug restrictions, the plan may have certain coverage restrictions (including quantity limits, prior authorization, etc.) on a prescription drug. Although your prescription may have limitations, these limits may not necessarily adversely affect you, and the plan may still meet your needs. For example, if you take 30 pills a month and the plan will cover a maximum of 60 per month, that would not impact you, and the plan is still worth considering.

Estimated Annual Costs

This is an estimate of the average amount you might expect to pay each year for your prescription drug coverage. This estimate includes the following costs:

  • Monthly premiums
  • Annual deductible
  • Drug copayments/coinsurance
  • Drug costs not covered by prescription drug insurance

If you entered your drugs into the Medicare Plan Finder, then this estimate includes the cost of those drugs.

IMPORTANT If your prescriptions are covered by the plan’s formulary and there are no major drug restrictions on the plan, this is the critical piece of information you need to determine which plan you select because it factors in all your premiums, deductibles, co-payments, and miscellaneous drug costs for the entire year. I don’t really factor in the various co-payments of each prescription; the estimated annual costs tell you approximately how much you will spend during the entire year.

Compare the estimated total annual pharmacy and mail order costs between the different plans to determine which plan offers you the best deal for the entire year!

PDP1-0019xNOTE In the previous example, the total retail annual costs for Humana are approximately $341 compared to $221 for the mail order costs. For Aetna, the total retail costs are approximately $347 compared to $387 for the mail order costs. Therefore, in this example, the most cost-effective option is to purchase the Humana PDP and use their mail order service.

If you selected “I don’t take any drugs,” then this amount includes only the cost of the monthly premiums that you would pay for the plan and it does not include any drug costs. If you selected “I don’t want to add drugs now,” then this estimate includes the average drug costs for people with Medicare and may differ depending on your age and health status.

Annual Drug Deductible

Some plans have no annual deductible and others have a maximum annual deductible up to $360 per year. Again, use the estimated annual costs to determine the value of the plan, not just the deductibles, the co-payments, etc.

Monthly Premium

The lowest monthly premium (and deductible) does not necessarily mean that you will be saving the most money. Again, compare the estimated annual drug cost to determine which plan is the most cost effective.

Overall Star Rating of the Company

For plans covering drug services, the overall score for quality of those services covers many different topics that fall into four categories:

  • Drug plan customer service: Includes how well the plan handles member appeals.
  • Member complaints and changes in the drug plan’s performance: Includes how often Medicare found problems with the plan and how often members had problems with the plan. Includes how much the plan’s performance has improved (if at all) over time.
  • Member experience with plan’s drug services: Includes ratings of member satisfaction with the plan.
  • Drug safety and accuracy of drug pricing: Includes how accurate the plan’s pricing information is and how often members with certain medical conditions are prescribed drugs in a way that is safer and clinically recommended for their condition.

If the plan has a low star rating, I would not recommend signing up for it.

Drilling Down a Little Deeper on the Medicare.gov Website

To get more information about a specific plan, click on the name of the plan, which is a hypertext link. In the following example, click Humana Walmart Rx Plan (PDP).

Medigap2-0002a

After you click the name of the plan, a window, similar to the following, displays.

Medigap2-0003a

The previous window shows the phone numbers, for members and non-members.

NOTE  If you have questions about the plan or wish to enroll, you would call the phone number for non-members. For more information, see “Signing Up for a PDP Plan” below.

Medigap2-0006a

The previous window shows the estimated monthly totals for prescriptions at CVS Pharmacy.

Medigap2-0007a

The previous window shows the estimated monthly cost (premium and deductible) for prescriptions at CVS Pharmacy.

Medigap2-0008a

The previous window shows the estimated monthly cost (premium and deductible) for prescriptions at Costco Pharmacy.

Medigap2-0009a

The previous window shows the estimated monthly cost (premium and deductible) for prescriptions through a mail order pharmacy.

Medigap2-0010a

The previous window shows drug coverage information, such as formulary status and Tier information, for the various prescriptions you entered on the Medicare.gov website.

Signing Up for a PDP Plan

After you have evaluated and compared several prescription drug plans, you are ready to sign up for a PDP on your own.

Follow these steps to sign up for a prescription drug plan:

1.)  From the Your Plan Details window, click on the hypertext name of the plan you are interested in. In the following example, click Humana Walmart Rx Plan (PDP).

Medigap2-0002a

After you click the name of the plan you are interested in, a window, similar to the following, displays.

Medigap2-0003a

2.) Call the toll-free number for non-members, and speak to a representative of the company.

IMPORTANT  If you have questions about the plan or wish to enroll, you would call the phone number for non-members. When you decide to enroll, call the plan and verify that your prescriptions are covered by the plan and that the estimated annual retail pharmacy or mail order drug costs are accurate. You want to make sure that you are interpreting and understanding the information correctly from the Medicare.gov website.

Conclusion

After you go to the Medicare.gov website and play around with it a little, you will find that signing up for a prescription drug plan is really quite easy.

NOTE  If you are having trouble signing up for a prescription drug plan or if you ever have Medicare questions or need help understanding information on the Medicare.gov website, call 1-800-MEDICARE. They are open 24 x 7, and most of the representatives are very helpful.

My primary specialty is Medicare Supplement insurance, but if you have any questions or comments, please feel free to contact me at RonLewisInsurance@yahoo.com.

Want to Change Your Medicare Advantage Plan to a Medicare Supplement Plan During AEP?

MEDICARE_MazeThe Annual Enrollment Period (AEP) for Medicare Advantage (MA) plans (Part C) is almost here! If you have an Advantage plan and you’d like to change to a traditional Medicare Supplement plan, you can apply during the upcoming AEP, which is from October 15th through December 7th, for an effective date of January 1st, 2016.

If you have an Advantage plan or a Prescription Drug Plan (PDP), this is the one time of year to make changes to your health and/or prescription drug plans for the following year. To make these changes, the plan has to receive your enrollment request (application) no later than December 7th. If you stay with the same plan that you had, any changes to coverage, benefits, or costs for the new year will also begin on January 1st.

What is the Annual Notice of Change (ANOC)

Medicare_AdvantageIf you have an Advantage plan, your plan will send you an “Annual Notice of Change” (ANOC) each fall. The ANOC includes any changes in coverage, costs, provider networks, or service areas that will be effective in January. These are usually mailed out in September by your Advantage plan. After you receive your notice, review any changes to decide whether the plan will continue to meet your needs during the following year. If you don’t receive this important notice, contact your Advantage plan and request that they send it to you.

IMPORTANT: If you have health conditions that may prevent you from meeting the underwriting requirements for a Medicare Supplement, the ANOC may qualify you for one of the “guaranteed issue” situations listed below.

Minimum Health Requirements for a Medicare Supplement

To apply for a Medicare Supplement during the AEP, you must complete a Medicare Supplement application, which includes a section with health questions. If you have serious health issues, there is a good chance that your application will be turned down. However, there are certain “guaranteed issue” situations that you may qualify for. This means that you will not have to answer any of the health questions on the application, and you cannot be turned down!

In the “Eligibility for Guaranteed Issue In California” section below, there are nine situations that would guarantee you the right to change your Advantage plan to a Medicare Supplement plan, REGARDLESS OF YOUR HEALTH, without answering any health questions on the application!

Carefully check the ANOC. If your Medicare Advantage plan has increased your premium or co-payments by 15% or more, reduced your benefits, or terminated its relationship with your medical provider who was treating you, YOU PROBABLY QUALIFY FOR A GUARANTEED ISSUE MEDICARE SUPPLEMENT PLAN!

Guaranteed Issue Rights

Guaranteed issue rights are rights you have in certain situations when insurance companies MUST offer you certain Medicare Supplement policies (plans A, B, C, F, K, or L). In these situations, an insurance company:

  • Must sell you a Medicare Supplement policy
  • Must cover all your pre-existing health conditions
  • Can’t charge you more for a Medicare Supplement policy because of past or present health problems

In most cases, you have a guaranteed issue right when you have other health coverage that changes in some way, such as when you lose the other health care coverage. In other cases, you have a “trial right” to try an Advantage plan and still buy a Medicare Supplement policy if you change your mind.

Medicare_Supplement

Eligibility for Guaranteed Issue In California

In California, you would qualify for a guaranteed issue Medicare Supplement for any of the following situations:

  1. Has your employer-sponsored retiree plan that is supplementing Medicare involuntarily terminated?
  2. Has your employer-sponsored retiree plan stopped providing Medicare supplement benefits or the Medicare Part B 20% coinsurance for services?
  3. Have you lost eligibility for an employer-sponsored retiree plan due to divorce or death of a spouse or family member?
  4. Has your Medicare Advantage plan increased your premium or co-payments by 15% or more, reduced your benefits, or terminated its relationship with your medical provider who was treating you?
  5. Have you moved out of the area of your MA plan or Program for All-Inclusive Care for the Elderly (PACE) organization?
  6. Has your MA plan, Medicare SELECT Plan, PACE provider or any other health plan under contract with Medicare: (a) committed fraud; (b) ended or lost its contract with Medicare; (c) misrepresented the plan you bought, or (d) failed to meet its contractual obligations to Medicare beneficiaries, as determined by the federal government?
  7. Did you join a MA plan or PACE organization when you first became eligible for Medicare at age 65, and you want to switch to a Medicare Supplement policy during your first 12 months in the MA plan or PACE organization?
  8. Have you switched from a Medicare Supplement policy to a MA plan, PACE organization, Medicare SELECT plan, or any other health care organization contracting with Medicare, for the first time since becoming eligible for Medicare within the past 12 months?
  9. Has your MA plan left your area, and if so, did your MA plan benefits end within the past 123 days?

Purchasing a Medicare Supplement Insurance Policy if You’ve Lost Your Health Care Coverage

If you believe that you have a guaranteed issue right to purchase a Medicare Supplement policy, make sure you keep the following items:

  • A copy of any letters, notices, emails, and/or claim denials that have your name on them as proof of your coverage being terminated.
  • The postmarked envelope these papers come in as proof of when it was mailed.
  • You may need to send a copy of some or all of these papers with your Medicare Supplement application to prove you have a guaranteed issue right.
  • If you have a Medicare Advantage Plan but you’re planning to return to Original Medicare, you can apply for a Medicare Supplement policy before your coverage ends. The Medicare Supplement insurer can sell it to you as long as you’re leaving the plan. Ask that the new policy take effect no later than when your Medicare Advantage enrollment ends, so you’ll have continuous coverage.

Which is Better, a Medicare Supplement or an Advantage Plan?

This topic is big enough to have its own blog! Personally, I strongly prefer Medicare Supplements over Advantage plans because you can go to ANY doctor or hospital in the US as long as they accept Medicare, and most of them do. With an Advantage plan, you are limited to their local networks of doctors and hospitals, and that is a major disadvantage. Also, a lot of people seem to think that Advantage plans cost less than Medicare Supplements, but if you are every hospitalized or develop a serious medical condition, you will be spending thousands of dollars on co-payments and deductibles with your Advantage plan.

Here are some pros and cons when comparing Medicare Supplements to Advantage plans.

Medigap Advantage Comparison ChartFor the reasons mentioned above, I would recommend Medicare Supplements over Advantage plans. If you are relatively healthy, an Advantage plan may be okay. But if you later develop serious health conditions, you’ll wish you had a Medicare Supplement because you should have the freedom to go to the best doctors, hospitals, specialists, and facilities ANYWHERE in the United States!

Peace of Mind Next Exit

If you (or someone you know) have an Advantage plan and you have any questions or would like to find out more about Medicare Supplement plans, please contact me at Ron@RonLewisInsurance.com. As an independent agent, I work with ALL the major insurance carriers in California, Washington, Nevada, and Arizona, and I’ll shop around for you to get you the best rates.

Which is Better, Medicare Supplement Plan F or Plan G?

Today, there are 10 standardized Medicare Supplement plans (Plans A through N). The coverage for these plans is the same no matter which insurance company you have. For example, the coverage and benefits for Plan F is exactly the same at Aetna, Cigna, Blue Shield, Stonebridge, Blue Cross, etc., so it’s much easier to shop around and compare plans and prices today.

As you can see in the following chart, Plan F provides the most extensive Medicare Supplement coverage. (The plans with the empty boxes indicate coverage that is not included with that particular plan.)

Medicare Chart

Of the 10 standardized Medicare Supplement plans (aka “Medigap” plans), Plan F is considered to be the best plan because it provides the most comprehensive coverage. Plan F pays for all of the coinsurance, copayments, and deductibles not paid for by Medicare.

Plan F pays for the following benefits:

  • Medicare Part A Hospital Deductible (Currently $1,216 per benefit period) *
  • Medicare Part A Hospital Coinsurance
  • Medicare Part B Deductible (Currently $147 per year)
  • Medicare Part B Coinsurance
  • Medicare Part B Excess Charges
  • Hospice Care Coinsurance or Copayments
  • Skilled Nursing Facility Care Coinsurance
  • Charges for First Three Pints of Blood
  • Foreign Travel Emergencies

* A benefit period begins on the first day you receive service as an inpatient in a hospital and ends after you have been out of the hospital and have not received skilled care in any other facility for 60 days in a row. Therefore, there can be multiple Part A hospital deductibles in one calendar year.

Which is Better, Plan F or Plan G?

Which is Better, Plan F or Plan G?

Plan F and Plan G include the following benefits:

  • Freedom to choose any doctor or hospital that accepts Medicare patients.
  • Benefits start immediately with no waiting period for pre-existing conditions.
  • There are no networks and no referral needed.
  • No cancellation for age, health or the number of claims you file.
  • Covers 100% of all Medicare allowable excess charges.
  • Coverage that expands automatically with any future changes in Medicare.
  • Virtually eliminates all claims paperwork for you.
  • 30-day, no-risk free look guarantees your satisfaction or you get your money back.

Medicare Plan G Is Identical To Plan F Except For the Part B Deductible

Medicare Plan G provides the same identical coverage as Plan F except it does not cover the $147 Part B calendar year deductible (in bold above). That is the only difference between the two plans. They are exactly the same in every other way! Plan F and Plan G are the only two Medicare Supplement plans that pay 100% of any excess charges, so there would rarely be any unexpected out-of-pocket expenses. (Excess charges are additional expenses incurred outside of the Medicare-approved charge. For example, if you go to a doctor that charges more than the Medicare-approved amount.)

Why Would I Choose Medicare Plan G Over Plan F?

The decision to go with Plan G depends on whether the annual savings will exceed the $147 Part B deductible. For example, if your Plan G premiums are $30 per month less than the Plan F premiums, then you will save $360 per year in premiums ($30 x 12 = $360). If you are healthy, and you didn’t go to a doctor that year, you would have saved $360 on your premiums. If you had to pay the $147 Part B deductible, then you still would have saved $213 for the year in premiums ($360 – $147 = $213). On the other hand, if your annual premium savings would be just slightly more than, equal to, or less than $147 per year, then you are unquestionably better off with Plan F.

The Likelihood of Future Rate Increases is Less With Plan G Than With Plan F

Under federal law, Plan F falls under certain Guaranteed Issue (GI) requirements while Plan G doesn’t. For example, if someone has their health insurance with an employer plan or if they are on a Medicare Advantage plan and they loose their coverage, in most cases, they are guaranteed the right to switch to Plan F, regardless of their health and without medical underwriting.

Plan G is not a guaranteed issue plan. Consequently, the overall pool of people with Plan G are healthier than those on Plan F, and the quantity of submitted medical claims is lower with Plan G. Rate increases are often a result of too much GI business, so “F” plans have historically had greater and more frequent rate increases than “G” plans. That’s not a guarantee that “G” plans won’t have future rate increases, but if they do, the increases will more than likely be smaller.

Make the Switch!

Make the Switch!

The Only Potential Risk That I See With Plan G…

The only potential risk that I see for the future is that nobody knows for sure what the Part B deductible for Medicare will be in the future. Between 2011 and 2012, the Part B deductible actually went down from $162 per year to $140 per year. For the last few years, from 2013 through 2015, the Part B deductible has been stable and remained the same at $147 per year.

Here is the history of Medicare Part B deductibles:

  • 2017 — $183
  • 2016 — $166
  • 2015 — $147
  • 2014 — $147
  • 2013 — $147
  • 2012 — $140
  • 2011 — $162
  • 2010 — $155
  • 2009 — $135
  • 2008 — $135
  • 2007 — $131
  • 2006 — $124
  • 2005 — $110
  • 1991 through 2004 the Part B deductible was $100
  • 1982 through 1990 the Part B deductible was $75
  • 1973 through 1981 the Part B deductible was $60
  • 1966 through 1972 the Part B deductible was $50

As you can see, the historical Part B deductible rates have been relatively stable over the years. For me, it wouldn’t be an issue if I could otherwise save $200 to $300 per year by having a Plan G Medicare Supplement. On the other hand, many of my clients can afford to pay for the best and most comprehensive plan, Plan F, and they don’t want the uncertainty of not knowing for sure what the future will bring. Saving $200 to $300 per year isn’t always a big enough motivator for many to warrant switching from Plan F to Plan G. Then again, many retirees are on tight budgets and fixed incomes, and if that is the case, I would unquestionably recommend that they switch from Plan F to Plan G if they can save money on their premiums.

The California Birthday Rule

With the California Birthday Rule, you are guaranteed the right to switch plans every year within 30 days after your birthday, regardless of your health and without underwriting, if another company is offering the same plan or a lesser plan for less money. In other words, if you have Plan F, you can switch to Plan F with a different company if their rates are lower, or you could switch from Plan F to Plan G with a different company since Plan G is considered to have less benefits (the $147 Part B deductible) than Plan F. Rates vary significantly from one company to the next for the same identical plan and coverage, so it’s important to shop around every year.

Please let me know if you have any questions or comments!

If you or someone that you know would like a Medicare Supplement quote, please let me know, or click here to visit my website. Or, you can compare Medicare Supplement prices on your own by clicking the “Get A Quote” button below.

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Hey Seniors… If You Like Your Medicare Advantage Plans, You Can Keep Them, Period…Maybe Not!

obama-if-i-like-your-plan-you-can-keep-itSound familiar? Part of the Affordable Care Act (ACA), also known as Obamacare, aims to reduce federal payments to the Medicare Advantage (MA) plans over time, and these savings would help pay for some parts of the ACA. In other words, Obamacare is slashing Medicare and MA benefits, which will adversely affect seniors in order to pay for other new programs created under the law that aren’t even for seniors!

According to Robert E. Moffit, Ph.D., “The money is cut from hospital services, Medicare Advantage, skilled nursing services, hospice services, and other Medicare services. To be clear, the cuts do not target individual institutions or medical organizations suspected of waste, fraud, or abuse.” Moffit goes on to say that “The $716 billion in “savings” from Medicare are taken out of the program to pay for new spending in Obamacare. The cuts do not strengthen the Medicare program, nor do they extend the life of the Part A trust fund.” Consequently, the $716 billion that is being cut from Medicare will not enhance Medicare Advantage benefits, and there is speculation that these drastic cuts will also adversely affect traditional Medicare and Medicare Supplements as well!

One way it’s expected to do this is by requiring Medicare Advantage plans to have a “medical loss ratio” of at least 85 percent. This means the companies offering the plans would have to spend at least 85 percent of the money they get on actual medical care. In other words, insurance companies can use no more than 15 percent for administrative costs and profits. As soon as these changes were announced with the ACA’s passage in 2010, there were fears and rumors that this was the beginning of the end for Medicare Advantage plans.

Medicare Advantage PlanThe Centers for Medicare and Medicaid Services (CMS) recently proposed a 1.9% cut in Medicare Advantage payments next year. If these cuts are implemented, many fear that millions of seniors who currently rely on the Medicare Advantage program will lose the plans, benefits, doctors, and financial protection they currently have. Seniors and people with disabilities who are enrolled in Medicare Advantage plans would face premium increases and benefit reductions of $35-$75 per month, or $420-$900 per year. According to Oliver Wyman of America’s Health Insurance Plans (AHIP), these types of cuts could result in a “high degree of disruption in the MA market,” including the “potential for plan exits, reductions in service areas, reduced benefits, provider network changes, and MA plan disenrollment.”

In all fairness to the supporters of the Medicare Advantage plan cuts, Medicare Advantage plans were paid on average more per beneficiary than what Medicare paid for beneficiaries enrolled in traditional Medicare plans. One of the goals of the ACA is to equalize the federal spending over time, so the government pays the same amount whether a beneficiary enrolls in Medicare Advantage or traditional Medicare. Cuts to Medicare Advantage plans are part of the $716 billion in Medicare spending reductions the health law calls for over the next decade.

As an independent insurance agent, I work primarily with Medicare Supplement (Medigap) insurance plans, which is health insurance for people who are 65 and over. The alternative to Medicare Supplements is Medicare Advantage (MA) plans. Personally, I’m not a big fan or advocate of MA plans because they are much more restrictive than “original” Medicare Supplements. By that I mean you are restricted to the doctors and hospitals in the plan’s network. With Medigap plans, you can go to any doctor or hospital in the country that accepts Medicare, and if you develop a serious illness, you have much greater freedom and options, and you are not limited or confined to a specific network of doctors or a geographic area.

Health Care Reform2Medicare Supplements do not include prescription drug coverage. For that, you would have to purchase a separate prescription drug plan (PDP) called “Part D.” (“Part A” is hospital insurance, “Part B” is medical insurance, and Medicare Advantage plans are referred to as “Part C.”) MA plans usually cost less than Medicare Supplements and many MA plans include prescription drug coverage. Some of the MA plans also provide additional benefits such as dental, vision, and wellness, which are not covered by Medicare. For these reasons, enrollment in Medicare Advantage plans rose in 2014 by 8.9 percent to 15.9 million enrollees, which is up from 14.6 million in 2013. Obviously, these plans are still very popular.

As mentioned before, I am not too excited about MA plans because of the network and geographic restriction. If money isn’t an issue, I would recommend a Medicare Supplement plan over an MA plan. However, for many retirees, MONEY IS AN ISSUE as many seniors live on fixed incomes, and every dollar counts.

Because of the cuts, reduction of benefits, and increased costs to seniors, there is no question that millions of seniors who rely on the Medicare Advantage program will lose the plans, benefits, doctors and financial protection they currently have. And just like the ACA, this could cause another major disruption in the health insurance market and a lot of confusion for seniors and their family, which they really don’t need at this stage of their life.

Unless the proposed cuts to Medicare and MA plans are significantly reduced or eliminated, I think there is a good chance that many seniors will not be able to keep their MA plan, even if they like it, PERIOD!

What do you think?