Many retirees are spending more money in their pockets than they need for medical care. One source concluded that about 90% of Medicare beneficiaries pay more than they need to.
That’s not surprising. Medicare is a complex program. Since the Medicare Open Enrollment is here (October 15th to December 7th), here is my review of the important steps people should consider and the mistakes they should avoid.
Open your “my Medicare” account. You can open an account at medicare.gov.
Your account gives you access to Medicare’s Planfinder tools, which you can customize and save your results to your account. This is especially useful if you are taking a lot of medication and are looking for the best Part D prescription medication plan.
You can also view your bill under the original Medicare in process. Not only is this a quick and easy way to keep up with your progress, but it’s also a quick and easy way to see if someone is using your Medicare number illegally.
You can also review the list of qualified preventive services and print a copy of your Medicare card. There are also other useful features.
Get help from SHIP. In each state, trained volunteers support Medicare. This program has nothing to do with insurance companies or health insurance. Officially the State Health Insurance Support Program (SHIP), but some states have different names. The Medicare website has contact information for programs in various states.
It is a free service with no income or wealth restrictions for program users. SHIP helps you compare plans, participate in plans, learn more about Medicare, and solve various Medicare and billing issues.
Determine the Medicare you need. You can choose between the original Medicare and Medicare Advantage.
Medicare Advantage is a comprehensive coverage that includes original Medicare, most of the original Medicare gap compensation, prescription drug compensation and more.
The disadvantage of Medicare Advantage is that you cannot choose a healthcare provider and usually require treatment or dosing approval. Also, if you move, the same plan or even an equivalent plan may not be available in the new area. You need to start over.
With the original Medicare, you can choose your own doctor and do not need approval to see or be treated by a doctor.
However, the original Medicare has many gaps in coverage. It is highly recommended to purchase both the Medicare Supplement Policy and the Part D Prescription Drug Policy.
You are guaranteed to be able to purchase the supplement policy when you first qualify for Medicare. If you then switch insurance policies or buy insurance for the first time, the insurance company can underwrite medical insurance and refuse coverage or claim a higher premium.
There are 10 Medicare supplemental plans or policy types. All insurers have the same coverage for each plan as they are regulated. Plan G covers the widest range. Unless you have to pay lower premiums and receive less coverage in return, you will need to purchase a Plan G policy. The next widest plan is Plan N.
Shopping, shopping, and comparison. People don’t like buying insurance. As a result, many pay more than they need to. Studies show that premiums for the same Medicare supplement and Part D policy differ by as much as 100%.
Don’t pay too much attention to TV commercials and emails that promote various Medicare coverage. You will pay for those marketing costs.
In most regions, you can find insurance brokers that specialize in the Medicare market and work with multiple insurance companies. Work with one or more of these insurance brokers. And don’t hesitate to talk to SHIP volunteers.
However, do not automatically adopt the lowest price policy. You want an insurance company that has been providing insurance for years, has few consumer complaints, and has a history of moderate rate growth. Some insurers set low insurance prices to increase market share and raise premiums or withdraw from the market if insurance is unprofitable. With Medicare Supplemental Insurance, you wouldn’t want to switch insurance companies to get medical insurance coverage.
I’m skeptical about the benefits of the additional advantage plan. Medicare pays each Medicare Advantage provider or insurance company a fixed amount for each registered beneficiary. Medicare also allows each provider to develop a package of benefits within the constraints.
Some Advantage Plan providers advertise free additional services not available in the original Medicare, such as meals, transportation, personal home aids, and bathroom safety devices.
If you read the details of the plan, you will find that most of these benefits are limited. For example, members can usually select only one of the additional benefits. You do not receive all of them. In addition, other benefits of the plan are often reduced in order to pay additional free benefits.
Don’t be tempted by celebrity-marketed Medicare plans or top-selling TV ads.