Many people wish they had more information on this, such as,”Why are they now looking for health coverage. Did they just recently come off of a group health plan? Are they on Medicare? Since I don’t know this information, please indulge me and I’ll give you the best I can find.
First, if they aren’t on medicare, I would suggest that you contact the Social Security office, right away, and get them on it. Both Part A & Part B. Part B will have a premium of $88.50/mo. for each of them, but it’s the least expensive coverage you will find, and they take this premium out of their Social Security check each month. As far as Medigap, a medicare supplement is their only option until the first of next year. (I’ll expand on that in a minute). There are lots of companies that offer medicare supplements, but pre-existing health conditions could be an issue. If they are (mostly) healthy, meaning no diabetes, no heart or cancer problems within the last two years, the options are unlimited for a reasonably inexpensive medicare supplement.
I tend to lean toward the Conseco Medicare Supplement more than any other on offer. Why? It may not be the least expensive, but most Med Supps are, what is called, attained age. Which means, they will increase a little each year as the person gets older. Conseco seems to not increase as much as most out there, keeping the premiums affordable for a much longer period of time. Let me jump off here and answer the question,”why do they need a Medicare Supplement?” Medicare, for the last couple of years and as far as I can see from now on, has increased the deductible each year. This has everything to do with the financial stability of Medicare.
For 2006, the deductible for Part A is $956, this is not an annual deductible, but can reaccure as many as 4 times in one year. Allow me to explain, this deductible is only for 60 days. In other words, if they go into the hospital on Feb. 1 and get out on the 3rd and need to go back into the hospital anytime for any reason in the next 60 days, they don’t pay the deductible again. But, if they go back into the hospital, for any reason, 65 days later, they pay the $956 again. For this reason, I recommend that everyone on Medicare have some sort of Medigap policy, if they medically can qualify.
Everyone has a 6 months ‘guarantee issue’ time period when they first get on Medicare. This is Federal Law. No one can be turned down for a Medicare Supplement provided they apply for one in the 6 month time period, regardless of medical history. There are also some other situations where they may have a ‘qualifying event’ that will move this 6 month time to the present. Such as, if they recently were dropped from a retiree group policy, or if they have been covered by a group policy and have just recently retired. They also qualify if they have had a Medicare Advantage plan and either the plan pulled out of their area and they lost coverage or if they are within the first 12 months of coverage and wish to return to a Med Supp, these ‘qualifying events’ are the only way to extend the 6 month guarantee issue time period. If they are healthy, and can answer the first 10 or so health questions on the application with a “No”, then they can get a Med Supp from almost anyone. If they are diabetic, the lowest premium for a Med Supp is with Mutual of Omaha. United American also will issue the policy, but this is usually an issue age policy, and starts out much higher than M of O, but does not increase nearly as much. If one of them (or both) have had a Heart Attack, Stroke, a stent put in, or have had cancer within the last two years, I’m not aware of any Medicare Supplement company that will accept them. If this be the case, a Medicare Advantage Plan is their only option. I tend to like Med Advantage plans because the premium is usually alot less then conventional Medicare Supplements. The problem right now is, they have an ‘open enrollment’ and ‘closed enrollment’ period. The ‘open enrollment’ period runs from Nov. 15th of each year to Dec. 31st, with an effective date of Jan. 1. Any other time is what is called ‘closed enrollment’, and they can not enroll in these types of plans, unless they have experienced one of the ‘qualifying events’ disclosed earlier.
What is a Medicare Advantage Plan?
In a nutshell, this is a contractual agreement between an insurance company and Medicare. The insurance company assumes the financial responsibility for the medical claims the insured has, not Medicare. Medicare pays the insurance company an agreed amount, each month, depending on where the insured lives and the costs of medical care in that county. This is why when one signs up for a Med Advantage plan, they still have to pay the $88.50 each month for Part B. Some people think they lose Medicare when they join a Med Advantage, this is not at all the case. They still have Medicare, hence the Part B premium, it’s just the Medicare is no longer financially responsible for the health care costs of the insured, outside of the monthly amount Medicare pays the insurance company.
This is one reason why the premiums for the Med Advantage plans are lower than Medicare Supplements. Another reason is the Med Advantage plans may not pay as well as say a Plan D or Plan F Med Supp. The insurance company is not taking as much risk, so they don’t charge as much for the premium. Medicare Advantage plans generally will require the insured to pay a copay when seeking medical treatments. The amount of the copay varies, depending on the company and the plan the member is enrolled in. There are two types of Med Advantage plans available in 2006. One is an HMO plan.
In Oklahoma City, the Secure Horizons HMO plan has a $0 monthly premium for their Classic Plan. It is sometimes hard for a client to understand that they can have coverage for no premium, but it’s really not ‘no premium’ as Medicare is paying Secure Horizons each month for every member enrolled in the plan. Secure Horizons just does a good job in negotiating the rates the providers charge for their services and does a good job in managing the funds received from Medicare. They, at least last year and this year, do not require additional premium dollars to be paid by the insured to adequately and sufficiently pay all the claims. HMO plans are usually only available in Metro areas. For the rural people, they have an opportunity to get a Medicare Advantage Fee-For-Service Plan (PFFS)(new for 2006). This plan is very similar to what Med Supps were like before the Gov’t standardized Med Supps in the 1980′s.
These plans work the same way as the HMO’s in that the premium is usually lower because Medicare is paying the company’s the monthly amount per enrollment and there are copays for services rendered. One of the biggest differences is that with the Fee-For-Service Plan, the insured can go to any Doctor they wish, provided the Dr accepts Medicare Assignment. There are several companies that have introduced plans like these for 2006. The monthly premium required for all of these types of plans can vary from one year to the next, depending on the experience of the companies. What one company charged for the 2006 plan may not necessarily mean that the 2007 plan will be the same. We’ll just have to see what they come out with this fall to see what the premiums will do.
Elderly accepted
If you are interested in a PFFS plamay I STRONGLY recommend that you get with an agent that 1) you can trust, and 2) knows what he/she is talking about, before you sign on the dotted line. Seniors don’t like surprises, so make very sure that they are plainly explained on what it does pay, and what it does not pay. Be very careful here, as there are some plans that don’t pay much for a hospital stay, but tout how good their plan is. I blame this on the companies and their lack of training they give their agents. One company, that we are appointed with, spent the whole day (in their training session) talking about premium and the Drug Plan (Part D) that came with their plan and spend no time explaining what the plan did not pay. In their Infomercials they played on TV, they spent alot of time bragging on the $15 Dr. office copay, their included drug plan, and how cheap the premium was. They never mentioned that with a 5 day hospital stay the insured would be out $900. This means if the insured has 5 hospital stays that consist of 5 days each, the insured would be out of pocket $4,500. Now they do have a max out of pocket of $5,000, but if one is not aware of the co-pays and how it works, and don’t have a large savings, this could put one in a serious financial bind. Hence, the surprise! This would not be so bad if you are healthy or are expecting the expense, but the careful explanation many agents get, and the lack of understanding on their part, has led, or can lead, many people into financial ruin.
I don’t wish to scare anyone, because there are really good plans out there, Pacific-are has one of the best Fee-For-Service plans I’ve seen to date, it just wasn’t available everywhere last year. Hopefully they will expand their area next year. I have to Appolonia for this being such a long answer, and can only hope it will help answer your question. If it doesn’t, please expand on your question and give me more information so that I can specifically answer your question. If expanding your question gets into specific personal information, may I suggest that you write me directly at sgraves@agvantacare.com so that we won’t be making personal information public. Thank you for your question, and for using All-experts.com
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