From last week’s post on common problems that we all have with the health insurance system, it seems that Medicare is a major source of concern. I want to highlight a couple of questions and responses and then fill in as needed. After that, raise your new concerns in comments and we’ll figure things out as we go.
Let’s start with a common string of questions on Medicare supplemental plans using Peej01 as our jumping off point:
I’m not 65 yet, but I’m thinking that I should get a Medicare supplemental insurance plan when I go on Medicare. Can you explain the costs/benefits of those policies?
Barbara, an actual expert, replies:
For starters, go to Medicare.gov. There is a handbook that you probably already received but its on-line alternative can be easier to navigate. There is also a health plan comparison tool that allows you to plug in your exact drugs in order to personalize the comparison. It is my experience that most Medicare beneficiaries ask a threshold question of whether their doctor is in the network. For that, you might need to just ask your doctor. The comparison tool allows you to order results by premium, maximum out of pocket, etc.
MA versus Med. Supp. or some other kind of wrap around: The general perception is that if your employer is paying for an option, it usually ends up being a better deal, but you should do your homework. And no, I wouldn’t waive anything.
One thing to remember: for Medicare Supp, you are not underwritten when you are first eligible so if you think you want Supp, the best time to try it is when you are first eligible, because if you first enroll later, you will end up paying more.
The key point is that Medicare does not cover everything.
The biggest weakness with traditional Medicare and prescription drug coverage (Part D) is that there is no out of pocket maximum. This can be dealt with in four ways. The first is to be rich enough to self-insure. That works for millionaires who can pay the 20% coinsurance out of cash. The second is to never get sick or at least die very quickly. The two most common methods are to get a Medicare Advantage plan (Part C) or a Medicare supplement.
Supplemental plans are a buy-up. They limit out of pocket expenses for people. The richest plans move Medicare from an 84% AV plan to a 99% AV plan. The least expensive plans put in a fairly reasonable out of pocket maximum and a few other benefits. At the linked guide book, you should look at page 7 and 11.
The important thing with a Medicare Supplement is that you only need it if you go the traditional Medicare route. I worked for a company that sold Medicare Advantage plans and in Pittsburgh that was a popular choice. Medicare Supplemental plans are worth considering if you think you will choose traditional Medicare.
Next from Stibbert:
Awhile back (when you were Richard), you had a friend FP about end-stage home hospice care.
Can you post a link to that thread?
Sure thing!
And if Cactus Prescott wants to write some more, I want to read and learn some more from him!
May 14, 2016 Hospice
May 21, 2016 Death the Final Frontier
End of Life Doulas
My wife had thyroid cancer (easily treated, in remission).
Part of the treatment required 2 injections which cost $1700.
Her endocrinologist office submitted the claim as medical and we would have been stuck with most of the cost.
My wife’s hospital job is in insurance so she told the endocrinologist to check the prescription benefit and we were able to get it for $100So: why does the endocrinologist, who does this all day, every day, submit for the wrong coverage, or not submit for all coverages?
The short answer is that they don’t know. I’m working on a project right now that looks at the cost differentials of infusion instead of oral treatment pathways and there are some significant cost variances. But docs in most systems don’t know. More importantly, most of the docs have historically been told that their job is to get the patient better and not to worry about how the payment stream is categorized. This is a symptom of an underlying problem.
I don’t think there is anything nefarious going on; they will get paid $1,700 from either stream, it just matters if they are getting a big check from you or a small check from you plus a big fund transfer from the insurance company. If anything, they should prefer billing the pharmacy benefit as it gets them their money faster and more reliably in most cases.
Insurance benefit design is a mess. I spent a significant chunk of my working life in insurance and I get confused as to why a certain code is cross-walked into a certain benefit category. There are good operational reasons as to why this is the case but it creates massive complexity with only one insurance company much less the dozen or more insurers a typical practice could be dealing with.
That is what I have for this week… so tell us about your problems with insurance in comments and we’ll try to solve at least a few for next week.
rikyrah
You rock, Mayhew.
Thanks for this.?
efgoldman
David, people should know that Medicare Advantage / Supplemental Plans are licensed by the state, and just like the subsidized exchanges, the choices are limited.
Here in RI, for instance, we can choose AARP/United Health (DON’T!) or Blue Cross/Blue Shield. Each offers a selection of plans at different premiums and coverages.
Also read the coverage carefully. RI is a small state and I have several providers in MA. We also travel to DC/Northern VA. Make sure your plan has 50-state coverage – nasty surprises await those who don’t. Higher premiums, but better, wider coverage..
Thanks always for the great, informative posts.
Meyerman
My father has a complex medical history (heart transplant 17 years ago + many other things going on). Now he is 80 and looking at treatment for metastatic squamous cell carcinoma. He is out of money besides a little bit from Social Security so our family is making sure he is good from here on. My sibs and I are trying to figure out whether we just keep paying all of his medicare associated premiums or whether medicaid (NJ) would make any sense from a financial/care perspective. Any thoughts on how we go about making the best decision? Thanks!
Wayne
Perfect timing, Thanks David. I turn 65 in November and sorting this out is high on my list. I live in Florida so any helpful info or links from anyone is appreciated.
pamelabrown53
@Wayne: #4.
I will be 65 in April and also live in Florida. I don’t know why this feels so overwhelming.
Mary G
I lucked into a good agent on the internet when I was first eligible for Medicare who explained that supplemental plans in California come in a range from A to F, F being best. He also knew that Blue Cross was the cheapest for Pre-65 coverage you get with SS disability. I am a distrustful person so I got other quotes which were all a lot, as in $663 a month thru AARP compared to $374 I got from Blue Cross at the time. Nobody else was under $500.
He is a total wingnut who still sends me newsletters about the evils of Obamacare and touting a lot of quack potions as seen on Fox News, but I am still grateful for the advice he gave me. The plan F pays for pretty much everything. Now I know it’s 99AV.
Barbara
@efgoldman: A few additional comments.
Med. Supp. has a specific menu of options. I think there are now 14. It is important to know that the richest benefit plan (Plan F, also the most popular) is scheduled to phase out over the next few years, unless they change that decision. Medicare thinks Plan F is responsible for excessive utilization.
Medicare Advantage is not the same as Med. Supp. There is no master list of what it has to cover beyond Part A and B benefits. Plans can vary how they approach the market but are heavily influenced by competition among both plans and providers in a given county or region. They spend a lot of time figuring out which benefits are most important for stoking enrollment. Vision and dental are huge drivers of enrollment.
Unlike regular Medicare, MA has an out of pocket maximum. The average premium in 2016 (in addition to the Part B premium) was $32 per month but varies ALOT by geography and that average is weighted considerably by the many large counties in which there are many $0 premium plans.
@Mary G: It’s actually A through N but some options have been eliminated, and Plan F will no longer be sold as of 2020. You can keep it if you already have it.
Yarrow
This is kind of a minor issue, but it’s been bugging me. My dad is on Medicare and also has supplemental coverage. His supplemental insurance sends out the explanation of benefits every time there is an interaction with a provider and their insurance is used. Medicare seems to send out their EOBs (or whatever they’re called for Medicare) every three months. So when he gets them they’re 20-30 pages long with multiple doctors’ visits. It can be hard to match up the treatment dates between Medicare and the supplemental because it’s just hard to find on the Medicare pages.
This structure also makes it difficult to know what to pay. He’ll get a bill from a provider. The supplemental insurance EOB will say nothing was covered by Medicare. But he has no way of knowing if it is covered by Medicare until the Medicare EOB comes through, which takes months. We’ve found many times Medicare does pay but it takes a long time. Meanwhile, we go back to the doctor and they say he owes money, but we don’t know how much should be covered.
Is this typical that Medicare only sends out its EOBs every three months? Is there any way to change that and increase the frequency of when they’re sent out? Like I said, a small thing but it’s an added complication. I don’t really know if it’s something I should look into or just figure that’s the way it is.
Alain the site fixer
David, thanks for doing this!
Barbara
@Yarrow: Is it actually from Medicare, or does the print out refer to any specific administrator that actually administers the day to day program operations? Wherever it is from, I would call the number that probably appears somewhere on the correspondence and ask that specific question. Most of the customer service is done by these private administrators, but it helps to know which one you are talking to, because they also have web sites that might answer those kinds of questions.
Yarrow
@Barbara: I don’t know the answer to that question. I assumed it was from Medicare because that’s what it looks like. I will have a closer look at the recent paperwork and see if I can find some more info. Thanks.
Ladyraxterinok
OT–Tornada hit Tulsa OK early Sunday. It hit at 41st and Yale, location of Promenade Mall, a major shopping center. There are many stores and restaurants in the area. Over 20 people eating at Whataburger and TGIF were sent to the hospital. Panera, Starbucks, Chipolte, etc, were damaged. PetSmart was damaged, and there are utube videos of the animals being moved. New car lots near 41st and Sheridan (1 nile east) were damaged. Many large trees in mall area were uprooted.
The Tulsa Foxnews channel has many videos on utube of the ongoing coverage of the damage. Yaboysuper has a 40 min plus video with some interviews on utube.
Paul L Anderson
@Ladyraxterinok: I blame fracking.
namekarB
This is why I cringe whenever I hear “Medicare for All.” We need universal health care.
Jim
I chose a supplement rather than MA and have been happy with the decision, since it provides much more flexibility in choice of doctors/hospitals. My sense is that if you live in a rural area that has few provider choices, and never intend to move, MA might be a good option. It can also be a lot cheaper. But I moved from a metro area (lots of choice) into a semi-rural area that happens to have both a very good rural hospital minutes away, and a relatively close university teaching hospital, both of which I’ve had to use. My supplement works at both (Plan J, now discontinued but grandfathered).
Big thing is to start looking at the options well before the Medicare decision point. Even ask your friends who are on Medicare how well their plans are working for them. We olds love to talk about medical issues and grandchildren. :-)
Philo Vaihinger
The wife and I have been on Medicare for a couple of years, and from the start we bought into a local advantage plan that restricts us, except for travel and emergencies, to an excellent local network.
Just under a hundred dollars a month each for an invaluable extension to cover the very large holes our Scrooge government has left in Medicare coverage.
We looked into the go anywhere, see any doctor supplemental plans like the stuff sponsored by AARP and they would cost hundreds more a month for each of us.
Social Security being so small, we in fact live in part on our savings, without which we could not afford even to stay in our crappy old house.
If we went with an AARP supplement those savings would run out a hell of a lot quicker.
We would qualify for Medicaid just about when we’re ready for assisted living, or maybe hospice.
And places you could afford on Medicare and Medicaid, alone, are likely to park everybody in a day room with Fox News on 24/7.
Something to look forward to.
Barbara
@Philo Vaihinger: You know, when I read comments like yours, I feel compelled to push back that whatever it is our government is a Scrooge about, funding the health care of seniors isn’t it. The average Medicare beneficiary receives services that cost three times what he or she paid into the system. What is wrong with the Medicare benefit is not that it is stingy, it is that it maldeploys resources and pays doctors in a way that is fundamentally misaligned with efficient and prudent care. Medicare is one of the root causes of health care fragmentation and runaway health care inflation in the United States.
Butch
Insurance agent here (rural Upper Peninsula) told me that supplemental would be paid for me since I work for a large employer. I assume that’s only as long as I work? Also confused about Part B; do I need it while I”m still working (which I assume means I’m still covered by employer’s plan) but then do I pay the penalty if I delay the start?
Barbara
@Butch: Check with your employer about Med. Supp. funding. Many traditional employers have shifted their retiree health benefits to funding a Medicare wrap product, or giving retirees funds to purchase supplemental benefits. Many have simply discontinued coverage altogether. If you are still working, your employer by law must permit you to participate in whatever plan the employer provides for active employees, but your employer is allowed to offer you an option whereby if you enroll in Medicare, they will fund supplemental benefits.
So the first question for your employer is whether the employer funds Medicare wrap for employees, retirees, or both or neither.
If you are actively working and participating in your employer’s plan and want to keep it that way, you do not have to sign up for Part B. Part B has a special enrollment process for people who did not join Part B because they were receiving health benefits as part of their employment (NOT RETIREMENT BENEFITS!). You must enroll according to that process within a specific period of time after your employer provided health plan participation ceases in order to avoid an enrollment penalty. Read this section of the Medicare Handbook carefully and be prepared to enroll in Part B according to the SEP requirements before you stop being eligible for employee benefits, so you can be sure you have what you need when the clock starts ticking.
If you get retiree health benefits and fail to enroll in Part B, there is no special enrollment process if for some reason those benefits stop and you will pay a penalty if you delay signing up. Many retiree plans now require retirees to participate in Medicare if they can do so, so most people should assume that they need to sign up when their employment stops, regardless if they still receive health coverage.
dnfree
When I retired I looked into the differences between Medicare Advantage and having a Medicare supplement plan (F, in my case). Even the Medicare Advantage salesperson for my area (only one Advantage plan is offered here) said “IF you have known health issues and IF you can afford it, you should buy a supplement plan rather than an Advantage plan.” Advantage plans are cheaper but they not only cost more out-of-pocket, they have limited networks, so if you are referred to a specialist your choices are limited. It’s more like employer insurance was. Supplement plans cover you anywhere in the country.
My husband and I took out supplemental plan F and have been glad we did, because of unplanned cancer and a heart attack. We paid not a dime for the cancer specialists, consultations, and surgery, nor for the heart attack and rehab. NOT A DIME. When I had cataract surgery, there is some test that isn’t covered, so that cost me $24 out of pocket. I am a risk-averse person and I would rather pay the set amount every month (which is a little over $200 for me at age 71, going up with age, on top of the basic Medicare type B charge) than face unknown charges.
I’m not sure the point made about choosing Medicare supplements at the beginning was clear. If you take out a supplement plan when you are first eligible, they don’t look at your health history and “rate” you. Everyone the same age and sex gets the same rate/premium. If on the other hand you either take out an Advantage plan or just take standard Medicare without a supplement, and four years down the road you run into health issues and decide you want to switch to a supplement at that point, you WILL be rated and your premium could be much higher because of your known health issues.
Supplement plans do not cover vision or dental, whereas some Advantage plans do. On the other hand, if you have medical complications such as diabetes that may affect your vision, your eye checkups may be mostly covered under medical. (Glasses or contacts will not be.)
There is apparently also a high-deductible version of plan F, which costs less but you self-insure up to a certain limit (you pay everything).
As someone else pointed out, plan F will be going away, and I have seen some sources say that its premiums will go up because only less healthy people will be using it.
Barbara
P.S. A lot of this depends on what kind of health benefits you are receiving now. Medicare might actually be beneficial if you have a high deductible or a small network. But if you are still employed, Medicare is secondary to your private employment coverage if your employer is large enough, so you don’t technically “need” to enroll in Part B, in the sense that you will not be charged a late enrollment penalty if you don’t enroll as soon as you turn 65. But everything is individual, so the choices you have available to you will dictate what is best for your specific situation.
Barbara
@dnfree: I assume that over time as Plan F purchasers age and it is closed to new purchasers, it will eventually encounter a death spiral. As it goes up in cost, you should be able to switch to another benefit option but it might benefit you now to ask your agent if switching between options can be done without underwriting. This is really down in the weeds, even for me. And some companies that could underwrite sometimes choose not to. It all depends.
Barbara
@dnfree: P.S. regarding the trade off between Med. Supp. and MA, Med. Supp. almost always ends up costing more, but as you say, people assess out of pocket costs very differently. Many people see paying a monthly fee for insurance to be a complete waste of money if they don’t need it for that month. You can tell them until you are blue in the face that’s the way insurance works, but for them, that $200 was a good part of their rent or utility bills or the difference between buying Christmas presents or not or going out to dinner on birthdays and anniversaries. MA plans strive desperately to go to $0 premiums for this reason. Also, with Med. Supp., you have to buy a standalone Part D plan, and standalone Part D plans have become noticeably less generous than Part D plans integrated with an MA benefit, so that is another thing to consider.
J R in WV
@Butch:
I am a retired state government employee in a nearly bankrupt state (which financial condition is getting worse as republicans have taken over the legislature over the past 4 years!) But my pension (which is fixed as of my retirement date) includes a medicare supplemental program partly covered by the state benefits I received.
I’m really dropping in to warn everyone to be really careful about the prescriptions they receive. In the past 10 months I have received two (out of maybe 8 maintenance scripts routinely) that were completely different from what the prescribing doctor intended. First was the wrong antibiotic, with such a different (from what we discussed) dosing pattern it made me suspicious when I read the directions. The intended medication had complex interactions with many of the meds I take routinely, such that I needed to stop taking them while taking the antibiotic. The one I received wasn’t going to interfere with my regular perscriptions, NOR WAS IT GOING TO CURE MY INFECTION AT ALL !!!
More recently, during my annual physical (passed again,hurray!) I told my Doc to take a good look at my left ear which had been making strange sounds (this also could have been a side effect of the odd antibiotic) and he noticed my eardrum wasn’t flat, it was concave, meaning there was a pressure differential between my head and the atmosphere. He prescribed a newish drug I had never before taken.
When I got home, I had paid a $100 co-pay (which my doc wouldn’t have necessarily known about) (even though my Humana supplemental document claims the highest co-pay is $50) for an inhaler designed and intended to treat COPD – which my parents dies of. I was pretty sure I don’t have COPD as I always pas my spiromometer (sp? breathe out hard) test with excellent results and have never smoked tobacco.
I called the Doc’s office even tho it was getting late, and hurray he was still in, and he told me they had gotten the numbers wrong, which led them to provide the wrong dosage and device. I got a $95 refund and the correct med the next day, which is an advanced put it up your nose and inhale measured dosage squirter. I’m not sure it’s helping, but at least it’s going to the right place in my body!
People (the prescribing doctor’s staff) on the anti-biotic prescription argued hard with me about how they never make errors, and didn’t make any offer to allow me to speak with the doctor (whom I really like and respect, but whose staff is bumbling idjits) but who did actually get me the correct drug with the correct wildly strange interactions and dosing pattern. It also helped my condition, which is good for the hassle it was to take. Strangest medical drug I have ever had!
Anyway, people, watch out for medical errors, which happen, and can be much worse in outcome than my two errors described above !!! No one is responsible if we aren’t ourselves. Read every package insert to be sure it is for what you have wrong. If your condition isn’t on the list of issues in the paperwork, you doctor should have mentioned that the prescription is off-label, which isn’t strange, they do that all the time. That just means the doctors have figured out that a drug can be helpful with other conditions than the developers tested it for.
Be careful out there in medical world~!!!
Spanky
@Barbara: So what replaces Plan F? I’m assuming that would be “nothing”, but willing to be pleasantly surprised.
Sixty-three y.o. here, monitoring our options closely.
Barbara
@Spanky: Plans A through E, and G through N.
Dr. Ronnie James, D.O.
Somewhat OT, but do you see IPAB ever happening? And bc Medicare usually sets the tone for rate-setting, do you think Medicaid and private insurance will follow suit? I can’t see the transition to value-based care happening until rates are adjusted, and that can’t happen until one of the big gun insurers starts adjusting rates accordingly.
Butch
@J R in WV: I’m going to provide two answers since the topics are so different.
I’ve learned the hard way to watch the scrips, especially after the insurance company tried to force me on to a generic; the generic was actually more than twice out of pocket what the “real” drug (medication) cost and involved side effects I couldn’t tolerate. I’ve become a much more active participant in my own health care since then. Thank you, though, for the reminder!
Butch
@Barbara: I’ve copied your response to a text file so I can save it. Thank you so much for the information!
dnfree
@Barbara: Thanks for your clarifications, Barbara! Regarding changing to another supplement plan, my insurance agent told me back when we purchased the plan we have that we would be able to switch to a different supplement plan if we needed to without being re-evaluated medically, since we started off on a supplement plan. But I don’t know any more than that.
Regarding having a separate Medicare drug plan (part D), you’re right about that also. I have seen the prices go up and down (and changed plans accordingly) over the five years I’ve been retired. The plan I am on currently costs $17 a month and after the initial deductible my standard generic medications have been basically free using mail order. I do have one expensive drug (that you see advertised on TV) but the plan covers even part of the cost of that medication.
jmw
@Mr Snub:
Doctors really don’t think about the cost of prescriptions for the most part (https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1989748/). My father was on the Pharmacy and Therapeutics committee towards the end of his career and was shocked by the prices even in Group Health/Kaiser which aimed for lowest cost/most effective treatments.
grandpa john
I am a retired state employee and get my prescription drugs and medicare supplement through the State BCBS plan.I use an insulin pump through Part B medicare. : also get my insulin through Part B using the pump no Copay. I can use a local pharmacy for my medications. The Medicare supplement plan pays every thing that Medicare doesn’t but pays nothing if medicare doesn’t pay anything. Part B and supplement fees are deducted from monthly retirement check so never any problems with payments I Live in SC , where pay wasn’t that great but Retirement system was good., with no tax, SS or retirement deducted from check.I bank almost as much as I did when working