Medicare Decision Basics

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saver007
Posts: 114
Joined: Fri Nov 07, 2014 9:18 pm

Medicare Decision Basics

Post by saver007 » Tue Oct 09, 2018 12:19 am

My parents approached medicare age. They've asked me to research and guide them through the choices. My parents are in NYC suburbs with middle income and is in OK health but not great.They are still working. At least for my dad, there is not going to be any employer provided plans

Here is my summary I prepared for them. Am I missing something important or misunderstanding how medicare works?

Traditional Medicare coverage is for Part A (in patient hospital) and Part B (outpatient/Doctor fees).
Part A has $1300 annual deductible. We need to pay this amount first before medicare coverage kick in
Part A co-pay for hospital stay is $0 for up to 60 days, $335 per day for days 61 to 90, $670/day for additional 60 lifetime reserv days. No insurance thereafter
Part B has $183 deductible before coverage kicks in
Part B co-insurace is 20%. That is medicare pay 80%. We pay 20%
Part A is free while Part B premium is $134 per month.

What traditional medicare( Plan A and B) doesn't cover?
Long-term care (also called custodial care), dental care, most eye exams related to prescribing glasses,hearing aid
Also traditional medicare has virtually unlimited out of pocket maximum due to 20% co insurance and high hospital co-pay beyond 60 days

There are mainly two ways to get additional coverage and set an out of pocket maximum
Option 1) Purchase a Medigap or Supplemental Plan and purchase Prescription Drug plan ( Plan D)
Option 2) Purchase Medigap Advantage Plan that may have drug,dental,eye,hearing included

Option 1) A) Purchase a Medigap or Supplemental Plan and B) purchase prescription drug plan

A) Purchase Medigap or Supplemental plans to pay for Part A/B co-pay and deductible.
Notably, It also can extend co-pay free hospital stay to 365 days from 60. Some medigap plans have emergency international coverage
There are 11 or so standardized medigap plans (Plan A,B,C,D,F,G,K,L,M,N). Each plan's coverage is standardized and is offered by multiple private insurers
None of the medigap plans covers drugs,dental,eye,hearing aid,etc
Medigap premium ranges from $70 to $365 depending on plan

B) Purchase Medicare Plan D - Prescription Drug Coverage
These are private insurance working under medicare rules.
Usually, we input the number of drugs we take and medicare's website will tell us which company's plan covers most of this.
Normally, there is a $405 annual deductible before coverage kicks in
co-pays are small (less than $10) for generic tier 1 and tier 2 drugs . Co-pay/insurance can be higher (15% to 40%) for brand names.
There is also something known as donut hole where coverage reduces once we use $3750 in benefits and picks up again once we pay $5000 out of pocket
While we are in donut hole, we pay 25% of cost , once we are out , we pay only 5% of cost.
Part D premium ranges from $10 to $100

Option 2) Purchase Medigap Advantage Plan that may have drug,dental,eye,hearing coverage included but gives up direct medicare Part A/B
Medicare Advantage (MA) plans are run by private insurance companies. We get traditional medicare coverage from them.
MA plans has different deductible and co-pays for in patient and out patient services than mentioned above under Part A/B
Medicare pays MA insurance company $ per beneficiary .They also collects additional premium from us. Some basic MA plans have $0 premium.
MA company need to follow medicare's general rules but can set its own network of providers, set co-pay
Many MA plans offer dental coverage and some offer eye,hearing aid coverage. These services are not offered by traditional medicare
MA plans typically restrict coverage to its own prefered provider hospital/docs. We pay extra for going out of network
MA plans have out of pocket maximum . (varies but roughly 5 .4K to 6.7K for in network and 10K for out of network for AARP plans)
Low premium means higher co-pay ,smaller network, higher out of network max, less additional coverage
MA plan premumn ranges from $0 to $76 for AARP plans


I guess the main decision is either to go with medigap or Medicare Advantage. Comparing Medigap plan F high deductible plus Plan D with AARP MA plan 3 PPO, MA plan is about $50 per month cheaper. That is after MA having dental,eye,hearing aid coverage that medigap don't have and I chose the cheapest medigap in our area - Plan F high deductible which I read is going away for new enrollees starting 2020.

khh
Posts: 226
Joined: Sat Dec 27, 2008 10:31 pm

Re: Medicare Decision Basics

Post by khh » Tue Oct 09, 2018 3:16 am

Sister will be signing up in a few months, and I recommended the following You Tube channel => https://www.youtube.com/channel/UCttfJc ... RC6ZJWiIIg

He explains everything clearly and seems to know the subject well. As for me, I went with Plan G when I signed up 2 years ago. The contract is guaranteed for life, provided you pay the premiums and haven't misrepresented anything in the application.

BarbBrooklyn
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Location: NYC

Re: Medicare Decision Basics

Post by BarbBrooklyn » Tue Oct 09, 2018 3:51 am

Do your parents have CURRENT medical coverage through their jobs? If so, they don't need to sign up for Part B now; they DO however, need to show proof that they were covered during their initial eligibility period, otherwise, there is a penalty for late sign up.
BarbBrooklyn | "The enemy of a good plan is the dream of a perfect plan."

saver007
Posts: 114
Joined: Fri Nov 07, 2014 9:18 pm

Re: Medicare Decision Basics

Post by saver007 » Tue Oct 09, 2018 7:20 pm

khh wrote:
Tue Oct 09, 2018 3:16 am
Sister will be signing up in a few months, and I recommended the following You Tube channel => https://www.youtube.com/channel/UCttfJc ... RC6ZJWiIIg

He explains everything clearly and seems to know the subject well. As for me, I went with Plan G when I signed up 2 years ago. The contract is guaranteed for life, provided you pay the premiums and haven't misrepresented anything in the application.
Thanks. That YouTube channel was very helpful especially his comments about F high deductible. In NY area it make a lot of sense to get F high deductible as it's premium is around 70 while F and G runs around 250 plus. But I am bit concerned since F plans will be shut for new enrollees. Hope fully the G high deductible that will be replacing F high deductible has lower premium as well. Not sure if anyone has insight on it?

I do have couple more questions for those in know.

How is the foreign coverage in some medigap plans work. I understand it's limited to 50k. Does it only cover emergency medical transport to USA or will it also cover foreign medical bills? My parents plans to stay extended periods in a foreign country.

Also, when choosing the insurance provider under a medigap plan , let's say F high deductible, is there any benefits to choosing known brands like Humana or AARP/United Healthcare? Known brands cost about $10-$15 extra per month. I am inclined to go with the cheaper not so we'll known plans. Am I missing something? I read about community rated vs age rated plans. Anything else I should think about?

saver007
Posts: 114
Joined: Fri Nov 07, 2014 9:18 pm

Re: Medicare Decision Basics

Post by saver007 » Tue Oct 09, 2018 7:22 pm

BarbBrooklyn wrote:
Tue Oct 09, 2018 3:51 am
Do your parents have CURRENT medical coverage through their jobs? If so, they don't need to sign up for Part B now; they DO however, need to show proof that they were covered during their initial eligibility period, otherwise, there is a penalty for late sign up.
Yes. They are working now with employer provided insurance. They expect to retire next year.

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Escape Velocity
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Re: Medicare Decision Basics

Post by Escape Velocity » Thu Oct 11, 2018 11:26 am

saver007 wrote:
Tue Oct 09, 2018 7:20 pm

I do have couple more questions for those in know.

How is the foreign coverage in some medigap plans work. I understand it's limited to 50k. Does it only cover emergency medical transport to USA or will it also cover foreign medical bills? My parents plans to stay extended periods in a foreign country.

Also, when choosing the insurance provider under a medigap plan , let's say F high deductible, is there any benefits to choosing known brands like Humana or AARP/United Healthcare? Known brands cost about $10-$15 extra per month. I am inclined to go with the cheaper not so we'll known plans. Am I missing something? I read about community rated vs age rated plans. Anything else I should think about?
Just a bump, as I too am interested to hear what insights current Medicare recipients/experts might be able to share about out-of-country coverage.

EV-

ResearchMed
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Joined: Fri Dec 26, 2008 11:25 pm

Re: Medicare Decision Basics

Post by ResearchMed » Thu Oct 11, 2018 11:36 am

saver007 wrote:
Tue Oct 09, 2018 7:20 pm
khh wrote:
Tue Oct 09, 2018 3:16 am
Sister will be signing up in a few months, and I recommended the following You Tube channel => https://www.youtube.com/channel/UCttfJc ... RC6ZJWiIIg

He explains everything clearly and seems to know the subject well. As for me, I went with Plan G when I signed up 2 years ago. The contract is guaranteed for life, provided you pay the premiums and haven't misrepresented anything in the application.
Thanks. That YouTube channel was very helpful especially his comments about F high deductible. In NY area it make a lot of sense to get F high deductible as it's premium is around 70 while F and G runs around 250 plus. But I am bit concerned since F plans will be shut for new enrollees. Hope fully the G high deductible that will be replacing F high deductible has lower premium as well. Not sure if anyone has insight on it?

I do have couple more questions for those in know.

How is the foreign coverage in some medigap plans work. I understand it's limited to 50k. Does it only cover emergency medical transport to USA or will it also cover foreign medical bills? My parents plans to stay extended periods in a foreign country.

Also, when choosing the insurance provider under a medigap plan , let's say F high deductible, is there any benefits to choosing known brands like Humana or AARP/United Healthcare? Known brands cost about $10-$15 extra per month. I am inclined to go with the cheaper not so we'll known plans. Am I missing something? I read about community rated vs age rated plans. Anything else I should think about?
If you have the type that has a $50k cap on foreign coverage and travel a lot (or even one trip, as a *bad* health problem could top that), then consider getting travel insurance. IF you do this, make sure that you get "primary" and not "secondary" coverage on that travel policy.

With secondary, the travel policy requires that you first submit to regular insurer, thus using up your $50k.
With *primary*, one does NOT submit to "own" health insurance first. Typically, there would not be any "leftover" costs with a good travel policy, so there'd be no reason, but you'd have that $50k waiting just in case.

We also get an annual policy from MedJetAssist.

This covers you IF you are hospitalized (inpatient, not ER/Observation/etc.) at least 150 miles from home (for USA policies, at least). In that case YOU get to decide to have MedJetAssist medevac you to "your hospital" of choice, assuming you are stable enough for a full medevac flight with medical attendants, etc.

NO need to have beancounters approve the need.
NO need to have local medical staff declare themselves unqualified for the job (caring for you).

We get both types of coverage from

www.TripInsuranceStore.com
(no additional cost to use them)

They work with several vetted insurers, and there is a nice variety of policies.

We've had good experiences with Travel Insured, through TIS.
TI has PAID the claims in a very timely fashion, and without any nonsense, and that's the point, after all!

RM
This signature is a placebo. You are in the control group.

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dm200
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Location: Washington DC area

Re: Medicare Decision Basics

Post by dm200 » Thu Oct 11, 2018 12:59 pm

It is Medicare Advantage - not Medigap advantage.

These plans vary greatly - both from different providers and by location - one area to another. In general, they tend to have the lowest costs of the choices - many with zero monthly premiums. There is an annual out of pocket cap - but that may be up to about $6,700 next year, depending on the plan.

In a few areas, there are Medicare Cost plans (we are in one) that are like MA plans, BUT allow use of original medicare from any provider that accepts it.

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dm200
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Location: Washington DC area

Re: Medicare Decision Basics

Post by dm200 » Thu Oct 11, 2018 1:05 pm

Just a bump, as I too am interested to hear what insights current Medicare recipients/experts might be able to share about out-of-country coverage.


Our Kaiser medicare plans cover emergency and urgent care out of the US.

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GerryL
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Re: Medicare Decision Basics

Post by GerryL » Thu Oct 11, 2018 1:36 pm

I made my first decision the one between traditional Medicare (with Medigap supplement and Part D) or Medicare Advantage (aka Part C). Only then did I seriously compare options. Doing otherwise you may find yourself comparing apples and oranges.

I opted for tradtional Medicare. One key reason being that if I wanted to switch to Part C in the future, that would be a possibility, but switching in the other direction is not a given because it may not be possible to get a Medigap plan later in the game.

Other considerations: choice of doctors not limited to a network and (with F high-deductible) I would have some coverage for overseas travel. I also didn't like the idea of having to revisit my Part C plan every year at open enrollment, because they do change. Enough work to revisit Part D plan.

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dm200
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Location: Washington DC area

Re: Medicare Decision Basics

Post by dm200 » Thu Oct 11, 2018 1:39 pm

GerryL wrote:
Thu Oct 11, 2018 1:36 pm
I made my first decision the one between traditional Medicare (with Medigap supplement and Part D) or Medicare Advantage (aka Part C). Only then did I seriously compare options. Doing otherwise you may find yourself comparing apples and oranges.

I opted for tradtional Medicare. One key reason being that if I wanted to switch to Part C in the future, that would be a possibility, but switching in the other direction is not a given because it may not be possible to get a Medigap plan later in the game.

Other considerations: choice of doctors not limited to a network and (with F high-deductible) I would have some coverage for overseas travel. I also didn't like the idea of having to revisit my Part C plan every year at open enrollment, because they do change. Enough work to revisit Part D plan.
There are several "safe harbors" being able to switch from a MA plan to Original Medicare and get the Medigap. You can do it for up to 12 months initially and later (not sure of details) for up to 3 months.

In general, though, you are correct about the situation.

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