Tuesday, September 10, 2013

Tips for Enrolling in Medicare

     I don't pretend to be an expert on Medicare. But I recently went through the process of signing up for Medicare, so I'm trying to pass along some basic information . . . to get you started.

      The first thing to know about Medicare is that . . . it's not just you, it is, indeed, incredibly complicated. As the doyen of senior blogging, Ronni Bennett, said on Time Goes By, "We all know that Medicare is not perfect. My biggest pet peeve is that it is way too complex. There are so many rules to understand both when signing up for Medicare for the first time and when choosing or updating a supplemental plan that hardly anyone can understand it without help."

     So here's some help.
    
     As you'll find out if you go to the Medicare website, there are several parts to Medicare. (For your further reading pleasure, Medicare also offers an information booklet.)

     Part A covers hospital bills -- in general, 80 percent of the cost. Part A is free. If you're already enrolled in Social Security, you should be enrolled in Medicare automatically. If not, you have to do it yourself. Some people receive mailings and reminders from their current insurance company to sign up for Medicare. But not everybody gets those mailings. So don't be complacent. When you turn 65, the age you're eligible to go on Medicare, make sure you get signed up, and if no one is doing it for you, then call Social Security at 1-800-772-1213, or Medicare at 1-800-633-4227. (Yes, there's a phone tree, but if you persist you can get a real person.) Or, go to an office in person. Or, you can enroll in Medicare online. That's what I did. That part is not so terribly complicated.

     Part B covers your doctors bills, ambulance service, some medical equipment and mental health services. You sign up separately for Part B, and it costs, currently, $104.90 per month (or more, if your income is over $85,000 a year, or $170,000 for a couple). If you don't sign up for Part B when you first become eligible, you may be subject to an ongoing penalty if you sign up later on. So, do it now!

     Part C . . . wait, see below.

     Part D covers your drugs.You must sign up for Part D separately, and the cost varies depending on your plan and your income. And again, if you don't sign up for Part D when you first become eligible, you may be subject to an ongoing penalty if you want to sign up later on.

     Okay, now here's the thing. Medicare does not pay for all your medical bills when you get sick or injured. Typically there is a deductible for you to pay. Then after that, Medicare pays 80 percent of your bills, with some variations for different procedures. Therefore, it's recommended you buy some sort of Medicare backup plan . . .

     There are two basic options for your Medicare backup plan. One is to purchase a Medicare Supplement plan, also called a Medigap plan, from a private company. It covers most of what Medicare doesn't cover, like the other 20 percent of your hospital and doctor bills. Advice: If your old employer offers a retirement health-care plan, that's probably your best bet. Many people who don't have the employer option go to AARP, where they get a Medicare Supplement plan through United Healthcare.

     And now ... Part C. This part of Medicare is actually something separate. It is a Medicare Advantage plan. This is an insurance plan supplied by a private company that works directly with Medicare. The Medicare Advantage plan consolidates all your other Medicare options into one overall plan.

     So, with a Medicare Supplement plan (which does not count as Part C), you pay separately for Part B, Part D, for the supplement plan itself, and for any other insurance you might want -- like a dental insurance plan, for example.

     With a Medicare Advantage plan, or Part C, you pay one bill that includes your drug plan, and also typically offers a dental plan. However, the Medical Advantage plan is either an HMO plan, or a PPO plan. With an HMO, you must go to a doctor in the insurance company's network. With a PPO you also go to a doctor in network. You can go to a doctor that's out-of-network, but the insurance will only cover a smaller portion of the bill that Medicare doesn't pay -- leaving you exposed to unknown and perhaps very high medical costs.

     Advice: If you want the convenience of a Medicare Advantage plan, and you want to stay with your current medical practice, you should call your doctor's office and make sure the doctor is in the network of that particular plan.

     Personally, when I was signing up, I thought I'd choose a PPO plan. I'd go to my doctor on a regular basis. But then, if I needed some kind of specialist that was out-of-network, I could go, and I'd just have to pay more.

     Then I found out that my current medical group does not accept the Medicare Advantage plan of my old insurance company, which was HIP. That would mean I'd be paying out-of-network fees every time I go to the doctor.

     It didn't make sense to me that my medical group would accept regular HIP; but not accept HIP Medical Advantage. But that's the policy. And my medical group is the biggest, most comprehensive medical group in my area. I did not want to change.

     Then I researched the AARP offering, through United Healthcare. My medical group accepts the United Healthcare Medicare Supplement plan. But, for some reason, it does not accept the United Healthcare Medicare Advantage Plan. Therefore, again, with the Advantage plan every time I'd go to the doctor, I'd be paying out-of-service fees.

     So I chose the AARP United Healthcare Medicare Supplement Plan. I do not have my insurance wrapped up into one policy. I pay a separate bill each, for Medicare Part B, Medicare Part D, and the Medicare Supplement plan. And then, since my supplement plan does not include dental, I purchased a separate dental plan through AARP, with yet another bill, for another $40-some per month.

     I pay four separate bills. The good news is that altogether they are about a third less than what I was paying through my old medical insurance plan, as of two months ago.

     I have yet to actually use Medicare. I haven't been to the doctor yet. I sure hope the process becomes a little easier.

     Meantime, I know there are lots of people with more Medicare experience than I have. So if I've got anything wrong here, I hope you will correct me. Or if there's anything to add, which could help the Medicare neophyte, I hope you won't hesitate to append your advice. Thanks and good luck!

13 comments:

Linda Myers said...

My Medicare card is effective as of 9/1/13. That's when my husband's prior employer's insurance stopped covering me and handed me off to Medicare. Same medical providers, though, at less than half the cost than I was paying before. That's before I actually go to the doc and pay the copay and whatever other surprises are in store for me.

However, I was able to join Silver Sneakers, and on Wednesday I went to my usual water aerobics class for free! - rather than my usual "nonresident, senior" rate of $5.50.

I'll be interested in how you get along with your dental coverage. What I've found is just miserable unless all you ever need is cleanings.

Christine said...

If it's of any help I have dental insurance for things like crowns, etc. but not cleanings. It cost $119.95 for a year. It can be found online at: http://www.dentalplans.com/

Stephen Hayes said...

This blog is such a valuable resource for retirement information, and I'm grateful to you, Tom, for providing it.

Olga said...

i started with Medicare in June but I have not had to use it at all yet. I had the option of just keeping my old insurance plan magically transformed into the supplemental and drug coverage so it seemed a whole lot easier than you are describing here. Now I start to wonder if I am actually signed up for everything!

Mac n' Janet said...

After seeing what Medicare actually pays to doctors I'm surprised that any of them accept it, if it were not for our supplemental insurance they'd really pay next to nothing.
I pay more in fees to Medicare than they pay to my doctor.

Bob Lowry said...

I will save this post for next spring when I will be faced with this same set of decisions.

Thanks, Tom.

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Rita said...

Congratulations to you for taking this on. It's a complicated consumer issue, but one that needs careful comparison.

Medicare Advantage has critics because the federal government pays more to companies to provide the program to each individual than it does for those not in Medicare Advantage.

I'm confused on what you wrote about Part B. You wrote that you pay a certain amount to Medicare for Part B. Then, later you wrote that Part B is part of your Medicare supplemental plan.

Can your supplemental policy could take care of all of the costs related to Part B?

Rita

schmidleysscribblins.wordpress.com said...

At present I am heavily involved with Medicare and yesterday spent almost an hour on the phone trying to obtain information on Medicare preferred rehab clinics (for hip replacement surgery, not drug abuse). At the end, I got nothing except the names of a few retirement homes in our area that don't serve non residents. Dianne

Tom Sightings said...

Rita, to clarify. Yes, we do pay a certain amount to Medicare for Part B -- currently $104.90 per month -- but Part B is NOT part of a Medicare Supplement plan. A Medicare Supplement plan is a separate policy that pays for the portion of your medical bill not covered by Medicare Part B.

A Medicare Advantage plan is different. It rolls your Part B into one overall plan that covers just about everything -- like a package deal. This option is generally a little less expensive, but the trade-off is that you have to make sure your doctor is in the insurance company's network. Make sense?

Anonymous said...

I will be eligible for Medicare in May, so have been researching various options. I've been very healthy all my life and don't have a regular doctor, so I may need to find one for checkups. I do see a dermatologist for skin surveys though and will want to continue with him. He does take Medicare patients.

I'm also looking at possibly getting a Medicare Savings Account (MSA), something the blog doesn't address. For someone healthy it may be the least expensive option, at least in the near term.

Currently I've been retired for 7 years and have been buying private insurance for my wife and teenage daughters. my wife is primary on the existing policy, which is basically just catastrophic ($10K deductible). I am assuming I may be able to get them a somewhat better/cheaper policy via healthcare.com, but with the site so fubar'ed I can't tell yet. It's also unclear if we'll get a subsidy for any plan. I can't tell if we'll count as a family of 4 or three in determining the subsidy, if any.

NY Fitz said...

Tom,

I feel as though I have made a new friend. As contempories, turing 65yo in September 2014, our life experiences, such as education, career, and relationships, appear very similar. Having grown up in NYC, I relate to your communication style and take on life's adventures as well. I am looking forward to, as I am confident you are also, to embracing life's final and best journey/adventure..retirement.

Anonymous said...

I called many of the major hospitals in NY and found that NONE of them work with Advantage Plans. If I get cancer Sloan Kettering would not be an option. Catastrophic illness is exactly why I would need Part C coverage. Since I just became Medicare-eligible I've been tearing my hair out over which Part C plan to choose.