Medicare Coverage 101
Every business wants and needs to sell products and services, but what motivated us to jump into the Medicare insurance business, was the genuine desire to
simply help people. Medicare is not something any of us grow up with, and for whatever reason, it doesn’t resemble the health insurance coverage we’ve had
for our entire lives.
On top of that, it can be complicated because Medicare insurance is delivered in parts---Part A, Part B and Part D. Or one might choose to have
some, or all of it delivered as Part C, aka, a Medicare Advantage product. And finally, one might want some of their coverage in the form of a Medicare
Supplement. Add a measure of anxiety with each part seemingly having its own enrollment period and corresponding late enrollment penalty, if the
enrollment window is missed, and one can see the necessity people have for a trusted Medicare insurance expert.
At Schweickert & Company, it is our mission to help as many people as we can, and we hope you’ll choose us to be your Medicare insurance expert. Below
we’ve provided some more information that will help make sense of the different parts of Medicare insurance. Please contact us when you’re ready
and we’ll piece it all together for you.
What are the available Medicare Insurance coverage options and what are the basic differences?
- Original Medicare Part A is coverage for hospital, skilled nursing facility, hospice and home health services. Most people automatically get Part A coverage without having to pay a Part A premium. This is because they or a spouse paid Medicare taxes while working for a specified duration of time.
- Original Medicare Part B is coverage for professional services such as those provided by a doctor or non-physician professional, outpatient care, and other medical services. Most individuals who file an application for Social Security three months before they turn age 65 or later are automatically enrolled in Part B, unless they refuse Part B coverage. For most people, the standard monthly premium for Part B is $104.90 in 2016. The standard monthly premium for Part B is $121.80 for individuals enrolling in Part B for the first time in 2016. Individuals with income over $85,000, or filing jointly with incomes over $170,000, pay more, up to $389.80/month.
- Part D is prescription drug coverage. This can be obtained as a stand-alone plan or in connection with a Medicare Advantage policy.
- Medicare Advantage (MA) (sometimes referred to as Part C) products provide all Medicare Part A and Part B benefits, and many include Part D prescription drug benefits as well. In addition, MA plans may include extra coverage like dental, hearing, vision, and/or health and wellness programs. MA plans are offered by private companies (e.g., Aetna, Anthem Blue Cross and Blue Shield) approved by Medicare. Medicare pays these companies to cover your Medicare benefits. There are HMO and PPO Medicare Advantage plans. Monthly premiums for MA plans can vary, however, it is not unusual to find an MA plan that is $0/month.
- Medicare Supplement (a.k.a. MediGap) plans fill “gaps” in Original Medicare coverage (Part A and Part B). MediGap plans work in tandem with Original Medicare, and cover all, or a portion of Part A and Part B cost sharing such as coinsurance, copayments, or deductibles. A key advantage of Medigap coverage is the ability to see any doctor who accepts Medicare---there are no networks to worry about. The average monthly premium of a Medigap policy is around $185
What is the most appropriate Medicare Insurance coverage option for you?
Well, that depends, of course. Here are some considerations:
- How important is the freedom to see any doctor who accepts Medicare?
- How important is prescription drug coverage to you?
- What is your budget? (There is a wide range in cost depending on the product)
- Do you travel a lot? Do you travel outside of the country?
- Are hearing aids in your future?
- Is free access to fitness clubs of interest to you?
- How important is transportation coverage?
- How about dental and vision coverage?
- Is finding a plan with a lower annual maximum out of pocket important?
- Is finding a plan with lower ambulance service costs important?
What are common Medicare Insurance coverage combinations a person might choose?
|A. Original Medicare Part A only
||B. Original Medicare Part A, and Original Medicare Part B
C. Original Medicare Part A, and Original Medicare Part B, and Part D prescription drug plan
D. A Medicare Advantage plan (It may include Part D
E. Original Medicare Part A, and Original Medicare Part B, and Part D prescription drug plan, and a Medicare Supplement
Please be aware of late enrollment penalties for Part B and Part D
- You may owe a late enrollment penalty if you go without a Medicare Prescription Drug Plan (Part D), or without creditable prescription drug coverage for any continuous period of 63 days or more after your Initial Enrollment Period is over (www.Medicare.gov).
- In most cases, if you don't sign up for Part B when you're first eligible, you'll have to pay a late enrollment penalty for as long as you have Part B. Your monthly premium for Part B may go up 10% for each full 12-month period that you could have had Part B, but didn't sign up for it. Also, you may have to wait until the General Enrollment Period (from January 1 to March 31) to enroll in Part B, and coverage will start July 1 of that year (www.Medicare.gov).
What is the Medicare Annual Election Period (AEP)?
- It’s an annual open enrollment period for Medicare Advantage and Medicare prescription drug coverage that takes place from October 15 to December 7 every year.
- It is available to all Medicare Advantage and Medicare prescription drug eligible beneficiaries (anyone entitled to benefits under Part A and enrolled in Part B)
During the Annual Election Period you may:
- Switch from Original Medicare to a Medicare Advantage plan
- Switch from a Medicare Advantage plan back to Original Medicare
- Switch from a Medicare Advantage plan to a different Medicare Advantage plan
- Join a Medicare prescription drug plan
- Switch from one Medicare prescription drug plan to another one
- Drop your Medicare prescription drug coverage
Why might someone opt for a Medicare Advantage PPO instead of a Medicare Supplement?
The main reason would be cost. A Medicare Advantage (MA) PPO can cost significantly less than a Plan F Medicare Supplement. There haven’t been a lot of MA PPO plans in the marketplace, but now there are quality options. The provider networks of these PPO plans are quite large, and in some cases, span across the nation. Contact us to see if a MA PPO plan would be a suitable option for you.
How is a Medicare Advantage product different from a Medicare Supplement?
A Medicare Advantage (MA) product provides all Part A and Part B benefits, and in most cases some extra benefits as well. Many MA plans will also include Part D prescription drug coverage. On the other hand, a Medicare Supplement (a.k.a. MediGap) plan fills “gaps” in Original Medicare coverage (Part A and Part B). MediGap plans work in tandem with Original Medicare, and cover all, or a portion of Part A and Part B cost sharing (coinsurance, copayments, or deductibles). Generally speaking, Medicare Advantage plans will cost significantly less than MediGap plans.
What changes can I make during the Annual Election Period?
- Change to a Medicare Advantage plan from Original Medicare, Part A and Part B
- Change to Original Medicare, Part A and Part B, from a Medicare Advantage plan
- Change from one Medicare Advantage plan to another
- Enroll in a Part D prescription drug plan
- Change from one Part D prescription drug plan to another
- Opt out of Part D prescription drug coverage completely
Contact Schweickert & Company today to review the Medicare Supplement questions you may have! Simply fill out the quote form at the top of this page or contact our Irvine Medicare Supplement Insurance Specialist, Drake at 714-689-1784. We look forward to helping you!