When I was approached about helping our Senior Insurance Agent, Ron Mallam, during Annual Enrollment for Medicare Part D, I had no idea what I was getting into when I enthusiastically agreed.
Let me just say, it has been a HUGE learning experience, and I couldn’t have asked for a greater mentor, or support from the rest of the office staff, and of course, my husband.
Medicare is complicated, to say the least.
It is so much different from Employer Group Health Care or Market Place Health Care.
A whole new ball game if you will.
So many rules and deadlines just for enrollment!
Taking the test for my license was the easy part.
But, being an educator at heart, I love explaining how Medicare works to those who are new to it and helping those not-so-new to it understand why it’s important to review their plan every year.
When… And Which One?
When you get to be 64, I suppose you start to think about if you should sign up for Medicare soon, and when you should sign up.
Should you sign up for both Part A and Part B?
Do you need Part C?
What is Plan G and Part D?
What is Medigap?
Why are there so many dang letters?
And most importantly…How do you sign up??
Let’s Start From The Beginning
Medicare Part A and Part B are often referred to as “Original Medicare”
Medicare Part A
Medicare Part A (hospital insurance) helps pay for inpatient care in a hospital or limited time at a skilled nursing facility (following a hospital stay). Part A also pays for some home health care and hospice care.
Medicare Part B
Medicare Part B (medical insurance) helps pay for services from doctors and other health care providers, outpatient care, home health care, durable medical equipment, and some preventive services.
The government sets the premium for this, based on how you filed your taxes and your annual income. https://www.medicare.gov/your-medicare-costs/part-b-costs
The Rest Of The Story
Other parts of Medicare are run by private insurance companies that follow rules set by Medicare. This is what your local agent can help you with:
Medicare Supplements
Supplemental (Medigap) policies help pay Medicare out-of-pocket copayment, coinsurance, and deductible expenses. They help “fill in the gaps” that aren’t covered by Parts A & B. Plan G is the most popular plan in this area.
Medicare Part D
The Medicare Part D (Medicare prescription drug coverage – Think “D” for “Drugs”) helps cover the cost of prescription drugs.
Medicare Advantage
A Medicare Advantage Plan (previously known as Part C) includes all benefits and services covered under Part A and Part B — prescription drugs and additional benefits such as vision, hearing, and dental — bundled together in one plan. These plans are not as common in Nebraska, especially Central and Western Nebraska.
When Should I Sign Up?
Signing up early is the key.
When you’re eligible at age 65, your initial enrollment period begins three months before your 65th birthday, includes the month you turn age 65, and ends three months after that birthday.
For instance, if your birthday is June 17th, your initial enrollment period is from March 1 through September 30.
If you are within three months of age 65 or older and not ready to start your monthly Social Security benefits yet, you can apply online to sign up just for Medicare and wait to apply for your retirement or spouses benefits later.
It takes less than 10 minutes, and there are no forms to sign and usually no documentation is required.
Because you must pay a premium for Part B coverage, you can turn it down. If you will continue to have coverage through your employer, you may not need Part B until you retire, in which case you will qualify for a Special Enrollment Period.
Start At The Beginning Of The Alphabet
If you go to www.medicare.gov and click on “Sign Up/Change Plans”. There is a lot of helpful information there. You can sign up for Medicare at https://www.ssa.gov/benefits/medicare/.
You can also sign up for retirement benefits with this application, so be sure to consult your financial advisor to see if that is the best option for you to select when filling out the Medicare application.
Once you have signed up for Part A and Part B, you will receive your new red, white, and blue Medicare Card. You can now make an appointment to get signed up for a Supplement and Prescription Drug Plan, or Medicare Advantage Plan.
When you schedule an appointment with Ron or Cherry, you should bring your Medicare Card, a list of your prescription drugs (including the complete name, dosage, and how often it is taken), and a couple of blank checks for payment on the Supplement Policy.
Some companies require a voided check, some require an actual check for payment, some just need the routing and account numbers along with the name of the bank.
Prescription Drug Plans also have a monthly premium in addition to the cost of your prescriptions, but offer you the choice of taking the premium payment out of your Social Security Check or Railroad Retirement Benefit.
Supplements do not offer this option.
Education Is The Key…Along With A List Of Your Prescriptions
If you are new to Medicare, we will take the time to explain how Medicare works. I like to use this handy-dandy chart from Mutual of Omaha (see below), because it gives more detail than other brochures I’ve seen.
There are many companies that offer Supplements. However, what most people don’t realize is that they ALL contract with Medicare, so they ALL pay the same benefits.
Basically, it comes down to premium cost. A 65-year-old female who does not smoke, and lives in Buffalo County, might pay $99.56/month for a Supplement with Company X, but the exact same coverage with Company Y is $120.35/month.
Choosing The Right Prescription Drug Plan (Part D)
When helping you choose a Prescription Drug Plan (PDP), we will again look at several companies and local pharmacies.
It is very important to have the exact name and dosage of your prescriptions!
Some drugs have several different forms. It might be an Extended Release, for example.
Drugs are categorized into different tiers, and the cost of that drug is based on its tier.
Drugs can change tiers from one year to the next, so a drug you pay $4 for now may cost you $100 next year if it has changed tiers.
An accurate desription on your prescription will determine if it may or may not be covered, or it may be on a different tier. This could affect which plan is the best for you.
So, once you have a plan in place, be sure to review your plan with us every year, to make sure the plan you are on is still the best one for your prescriptions.
This can only be done during the Annual Enrollment Period, which is October 15th through December 7th.
One other thing to consider is that the drug plans also have “Preferred In-Network” pharmacies, so come with an open mind to consider switching your pharmacy if it will help you save money.
Conclusion
There are a lot of curveballs that will come your way when planning for retirement, and health care is just one of them. Start early by signing up for Medicare (at least Part A) as soon as you are eligible to avoid a possible penalty. Check your employer’s rules so you know when your health care with them will end, including any money you have to use in an FSA or HSA. Finally, be prepared for your appointment by having everything you need.
If you are feeling overwhelmed after reading this, don’t be. The team here at Stonebridge is here to help, every step of the way.
