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Medicare Open Enrollment

By | 2017, Money Moxie, Newsletter | No Comments

Medicare open enrollment is right around the corner. If you are already using a Medigap plan or a Medicare Advantage plan, now is your time to move if you want to change your carrier.When is the open enrollment period?
October 15th through December 7th of every year.

Who needs to pay attention?
Those using a Medigap plan, Medicare Advantage plan, prescription drug plan, or if during your initial enrollment period you opted not to purchase additional coverage above traditional Medicare parts A & B.

What is traditional Medicare?
Traditional Medicare is composed of three parts: A, B, and D. Part A is coverage for hospitals and doesn’t have monthly premiums. Part B is coverage for doctor visits, etc. and the base cost is $134 per month for most people. This typically comes out of your monthly Social Security check. Part D is prescription drug coverage purchased from a third party.

What is the difference between a Medigap and Medicare Advantage plan? Medigap is an additional insurance that complements traditional Medicare. It covers most of the “gaps” or holes that are not covered by parts A & B. You can go to any doctor that accepts Medicare.

Medicare Advantage plans combine parts, A, B, D, and Medigap into one nice package. They operate more like traditional insurance where they have a service provider and you are tied to their network.

What else should I know about Medigap? Medigap plans are lettered from A to N with costs that vary depending on the benefits provided. The most popular plan is F as it is the most comprehensive and covers things like the Part B deductible and foreign travel emergencies. Because it is the most comprehensive, it is usually the most costly. However, by rule, any Medigap plan has the same benefits regardless of the service provider, even though the costs can vary significantly.

The only differentiator between companies is the level of service. Price then is a driving factor, but you should use a provider that is reputable. People that have comprehensive Medigap plans may pay more on a monthly basis, but typically don’t have to pay very much out of pocket. If your health is ok to poor and you see a doctor regularly, then this may be a good option for you.

What else should I know about Medicare Advantage plans? Medicare Advantage plans, also called Part C, will often cost less than Medigap plans. They will typically have deductibles and co-insurance like traditional insurance through an employer. They work by Medicare giving an insurance provider a certain amount per year to manage your expenses. If the insurance provider manages your expenses for less, then they make money. Because of that, monthly costs vary significantly with some plans as low as $0 per month.

People that use Medicare Advantage plans usually pay less on a monthly basis, but typically have more out of pocket expenses. If you are in good health and don’t regularly see a doctor, then this may be a good option for you.

What are some small facts that have big impacts? When you originally sign up for Medicare, you can choose either Medigap or Medicare Advantage without being denied. If you are on a Medicare Advantage plan and then try to go back to a Medigap plan, you could be denied based on health. You will never be denied access to a Medicare Advantage plan.

Are there any differences between prescription drug providers? Yes, costs can vary significantly. Shop around to find the best deal for your specific medication regimen. You can also go to Medicare.gov, enter the prescriptions you take, and it will screen for the best providers. To get there, visit Medicare.gov and click on Drug Coverage (Part D), then click on Find Health & Drug Plans.

What resources are out there to help me research my options? The website www.medicare.gov has a plethora of information. You can use it to sign up for Medicare or any of its parts A, B, C, or D. You can also find contact information for Medigap providers. If you would like to speak to a person you can call 1-800-Medicare (1-800-633-4227).

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3 Medicare Minefields

By | 2016, Money Moxie, Newsletter | No Comments

Simple missteps when choosing your Medicare and Supplemental Plans can cost you greatly if you are not careful. Here are a few to watch out for:

1. Prescription drugs
When it comes to paying for your prescriptions, all plans are not equal. In fact, plans can change the lineup of drugs they cover each year.

According to Kaiser Family Foundation, your costs for a prescription may increase ten times between formulary and non formulary drugs. Screen the plans to see how much each insurer will pay for the drugs you are taking.

You can visit Medicare.gov (under drug coverage, find health & drug plans) to search for plans that offer coverage for the drugs you take. Make a point to compare your drug plan with others each year to assure you are getting the best bang for your buck.

2. Medigap coverage
Getting the right plan for your specific needs can be tricky. If you choose Original Medicare Part A, you need a Medigap or supplemental policy – Part B to pick up where Medicare coverage leaves off. You also need to choose a separate Part D – prescription drug plan.

You can simplify by choosing a Medicare Advantage Plan – Part C which combines all of the coverages together and handles all claim processing through one carrier.

Some Advantage Plans still require you to pick up a separate policy for prescription drug coverage. In 2016, 69 percent of enrollees went with Original Medicare Plans while 31 percent chose Medicare Advantage Plans.

Medicare Advantage Plans generally require you to use a specific list of doctors and medical facilities through either a Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO).

When choosing an Advantage Plan check to make sure your favorite doctors and the facilities you most often visit are covered on the list of providers.

3. Important deadlines
Harsh financial penalties can be avoided by knowing your deadline dates. Failure to sign up during the enrollment period could mean your Part B premium may be 10 percent higher – for life – for each full year you are late signing up for Medicare Part B.

If you are 65 or older, still an active employee and covered under your employer’s health insurance plan you are not required to sign up at 65 unless your company has 20 or fewer employees. If this is the case, you may be required to sign up for Medicare Part A and Medicare Part B, which will become the primary payer when you have a claim and your employer’s plan will become the secondary payer.

Once the clock starts ticking, there is only a seven-month window to avoid permanent penalties. Call our office if you have questions regarding the deadlines or need more information about the requirements.

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Medicare Open Enrollment

By | 2015, Money Moxie | No Comments

America hearbeat

Medicare open enrollment is right around the corner. If you are already using a Medigap plan or a Medicare advantage plan, now is your time to move if you don’t like your current carrier.

If you have a Medicare card that you give to your doctor, then you have traditional Medicare. If you only have a card from an insurance provider that you give to doctors, then you have Medicare Advantage.

When is the open enrollment period? October 15th through December 7th every year.

Who needs to pay attention?
Those that are currently using a Medigap plan, Medicare advantage plan, prescription drug plan, or if during your initial enrollment period you opted not to purchase additional coverage up and above traditional Medicare parts A & B.

What is traditional Medicare?
Traditional Medicare is composed of three parts: A, B, and D. Part A is coverage for hospitals and doesn’t have monthly costs. Part B is coverage for doctor visits, etc. and the base cost is $104 per month. This typically comes out of your Social Security check. Part D is prescription drug coverage, which is purchased through a third party.

What is the difference between a Medigap and Medicare advantage plan?
Medigap is a “gap” insurance that covers most of the holes that are not covered by traditional Medicare parts A & B. You can go to any doctor that accepts Medicare. Medicare Advantage plans combine parts, A, B, D, and Medigap into one nice package. They operate more like traditional insurance where you have a service provider and you are tied to their network.

What else should I know about Medigap?
Medigap plans are lettered from A to N with costs that vary depending on the benefits provided. The most popular plan is F as it is the most comprehensive and covers things like the Part B deductible and foreign travel emergency. Because it is the most comprehensive, it is also the most costly.

By law, all Medigap plans have the same benefits regardless of the service provider. The only difference will be the level of service. Price then is a major driving factor, but you should use a provider that is reputable. People that have comprehensive Medigap plans typically pay more on a monthly basis but feel like they don’t have to pay very much out of pocket.

What else should I know about Medicare Advantage?
Medicare advantage plans, also called Part C, will often cost less than Medigap plans and will have deductibles and co-insurance like traditional insurance through an employer. It works by Medicare giving an insurance provider a certain amount per year to manage your expenses. If the insurance provider manages your expenses for less, then they make money. Because of that, monthly costs vary significantly with some plans as low as $0 per month. People that use Medicare Advantage Plans usually pay less on a monthly basis but feel like they have more out of pocket expenses.

What are some small facts that have big impacts?
When you originally sign up for Medicare, you can choose either Medigap or Medicare Advantage without being denied. If you are on a Medicare Advantage plan and then try to go back to a Medigap plan, you could be denied based on health. You will never be denied access to a Medicare Advantage plan.

Are there differences between prescription providers?
Yes, costs can vary significantly based on the provider and the types of medications you are taking. Shop around to find out who will give you the best deal for your specific medication regimen. You can also go to Medicare.gov and enter the prescriptions you take, and it will screen for the best providers. Visit Medicare.gov and click on Drug Coverage (Part D), then click on Find Health & Drug Plans.

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Long-Term Care

By | 2015, Newsletter | No Comments

Higher premiums for long-term care policies have retirees wondering how they’ll protect their nest egg.

Wealthy couples may be in a position to easily cover $10,000 a month or more for private care. But what about the couples who have diligently saved and accumulated just enough to cover their monthly living expenses? They could be wiped out financially if either spouse needs long-term care. An even greater concern: what will happen to a surviving spouse, financially speaking, if the liquid assets are used up providing care for an ailing spouse?

Options exist to help protect the nest eggs of those with limited resources. Learning about these options and understanding the rules that apply is best done when conditions are calm. Unfortunately, becoming Medicaid eligible rarely crosses the minds of retirees until a crisis arises.

One option is a Medicare compliant single-premium immediate annuity (SPIA). This option, if allowed in your state, will help the spouse living at home preserve assets to provide for his or her monthly living expenses.

Here’s the basic concept. Mr. and Mrs. Jones find out that Mr. Jones needs long-term care. Under Medicaid rules, Mrs. Jones is only allowed a certain amount of assets, not including the family home. Everything over the allowed limit is transferred to a Medicaid compliant SPIA thus converting the asset to an income over her life expectancy, usually a five- or six-year period.

By the time the SPIA has paid out in full, Mrs. Jones will have sheltered the assets to create a much needed income. Should Mrs. Jones die before her husband, the proceeds from the SPIA will go to cover his care.

This option is not designed to shelter assets for beneficiaries, but rather to maintain the standard of living for a healthy spouse.

For more information contact one of Smedley Financial’s wealth advisors who can answer any questions you may have and help determine if this option is something you should consider.

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