Stephanie Frisch is the owner of Insurance 101 and is an independent insurance broker dedicated to helping others make “educated decisions” about their insurance choices when it comes to Medicare, Long-Term Care Planning, The Health Insurance Marketplace-Covered California and Life Insurance. For answers to your questions, or an in-home, no-fee consultation, call (949) 351-2443.
When I get a phone call from someone that is preparing to go on Medicare, there are several questions that I ask to make sure they are set up properly before we meet.
You see my job is really about showing people their options for Medicare from private insurance companies (which is how I get paid and explains why my services are free). 8 times out of 10 I’m helping people what they need to do before we can proceed to review their options for a Medicare Advantage, Medicare Supplement or Medicare Prescription drug plan.
First off, if someone is still working covered under a large group insurance plan them self or through a spouse, they have an option of keeping that insurance or going onto Medicare. Variables to consider; what their household income is (if it’s higher than $170K for a married couple they’ll pay more for Part B and Part D in addition to any premiums from their Medicare privatized options), how good their insurance is that they currently have vs. options with Medicare, how much their premiums are.
If a large group insurance plan is an option for them, we also need to look their prescription drug use. On group plans there is no “doughnut hole” but on a Medicare drug plan there is. So, if someone is taking 3 or more name brand drugs a day, the likelihood of them going into the doughnut hole and consequently paying more for their prescriptions drugs is likely on a Medicare drug plan.
If someone has worked past 65 and stayed on a large group insurance plan but is now ready to retire, then there is a process with Social Security to get their Part B portion of Medicare activated (Part A typically happens automatically the month of your 65th birthday). Many times their retirement income will be much less than when they were working. There is a form that Social Security doesn’t broadcast but exists, that can filled out and turned in that shows a sudden decrease in income (Form SSA-44- Medicare Income Related Adjustment Amount-Life Changing Event and I have it electronically) so that they don’t have to pay more for their Medicare Part B or Medicare Part D, than necessary. The government bases what you pay for Medicare Part B & D on the tax return you filed two years earlier, so this can be a big savings.
Complicated? Yes...To me? No… Well, sometimes situations are unique and we learn together. Most of the time people tell me they don’t know how they could have ever gotten through the process without my help, and that’s rewarding.
There seems to be some confusion regarding the Medicare Part B premium. (This amount is taken out of someone’s Social Security check monthly, or if someone isn’t taking Social Security, it is billed quarterly). There have been more changes in the last 12 months to the Part B premium that I have seen historically in the last 7 years.
Starting January 1, most people with Medicare will see a small increase in their Part B premium, from $104.90 to an average of $109.00 per month. But about 30 percent of people covered by Medicare will see a minimum Part B premium of $134.00, a 10 percent increase from the minimum 2016 premium of $121.80.
This difference in premium amounts is due to a federal law which is commonly called the “hold harmless” provision. This provision prevents about 70 percent of beneficiaries from seeing major increases in Medicare Part B premiums when Social Security cost of living adjustments (COLAs) are nonexistent or very small.
The announced COLA for 2017 is very small, 0.3 percent, triggering the hold harmless provision.
Those who are held harmless will not see their Part B premium increase by an amount that is greater than the dollar amount of their COLA increase. Because the COLA is a percentage of a person’s Social Security benefits, the exact dollar amount of the increase, and the premium, will vary. For example, someone who has a premium of 104.90 deducted from their full Social Security benefits of $1,000 in 2016 will see a COLA of $3 and will have $107.90 deducted from their check for the Part B premium in 2017. Someone who gets 2,000 in Social Security benefits, will see a COLA of $6 and will have a Part B premium of $110.90.
Not everyone is protected by the hold harmless provision. Because the protection is tied to Social Security benefits, people with Medicare who do not receive Social Security or do not have premiums deducted from their Social Security checks are not covered. Those people who are new to the Medicare program in 2017, those who pay income-adjusted premiums, and those whose premiums are paid by their states are also not covered.
Many think that once December 7th is behind us (The Annual Enrollment period for Medicare) and December 15th (The cut-off for January 1st coverage to start for the Open Enrollment season in the Health Insurance Marketplace and Covered California), that opportunities for change are behind them.
As a broker with a schedule that for the last 3 months can be likened only to tax time for a CPA, I wish I could say that was the case, but it isn’t. Here are some other deadlines that you should know about.
Covered California and the Health Insurance Marketplace: You have until January 15th to enroll in a plan or make changes to your coverage effective for February 1st.
You have until January 31st to enroll in a plan or make changes to your coverage effective for March 1st.
Medicare “wanna be” beneficiaries: If you missed your initial enrollment period to activate the Part B portion of your Medicare when you turned 65 and you DO NOT have access to group health insurance from your employer or your spouse’s employer (COBRA Does NOT count, get off of that COBRA if you’re on it or otherwise face life long penalties) then you can take advantage of the Medicare General enrollment period from January 1st – March 31st. You would apply at your local social security office. Coverage wouldn’t start until July 1st however. You would still need to add a Medicare supplement and RX plan or enroll in a Medicare Advantage plan. That’s where I come in to help.
Medicare Advantage Disenrollment period: If you’re in a Medicare Advantage Plan, you can leave your plan and switch to Original Medicare. Your Original Medicare coverage will begin the first day of the following month. If you switch to Original Medicare during this period, you’ll have until February 14 to also join a Medicare Prescription Drug Plan to add drug coverage. Your prescription drug coverage will begin the first day of the month after the plan gets your enrollment form.
Do you get your Medicare benefits from a private insurance company? If so, that means you’re on a Medicare Advantage plan. Typically these plans have a Medicare prescription drug plan included with the medical benefits offered to you that replace your Original Medicare and the need to carry that card with you or your spouse’s social security number on it, around in your wallet.
All Medicare Advantage HMO plans offered in Orange County have a zero premium. If you’re on a Medicare Advantage HMO plan in Orange County and you have a co-pay for doctor visits, lab tests, diagnostic imaging, out-patient surgery, and/or in-patient hospitalization, then you should stop reading this article and call me immediately to discuss your options before it’s too late for the 2017 benefit year. Open Enrollment (your time to change your Medicare Advantage plan coverage) ends December 7th.
If you’re on a Medicare Advantage PPO plan, you can do better 9 times out of 10.
On these plans (only 2 offered in Orange County) you pay premiums, deductibles, co-pays, co-insurance and out of pocket costs with not only a high “in-network” out of pocket maximum, but also a MUCH higher “out of network” out of pocket maximum. If you need the flexibility of no network restrictions, you would do much better financially by going back to Original Medicare during this open enrollment season and adding a Medicare supplemental plan and a prescription drug plan.
Don’t try to make these decisions by “self-educating” during Medicare Open Enrollment. Your time is valuable, and you can’t risk making the wrong decision that has you locked into your choice for a year. My services are free to you. I am compensated by the insurance companies that I contract with. Thousands of Medicare recipients have benefitted from my experience over the years, and now it’s your turn.
It’s no secret, the Medicare prescription drug plan “coverage gap” (fondly referred to as the donut-hole by many) is very complicated.
Many people will never need to understand it because they won’t ever enter the coverage gap, but for those that do the good news is that the complexity of the “donut hole” will slowly fade away.
Over the next several years, you’ll pay less in the coverage gap until it’s closed by 2020. By 2020, you’ll pay only 25% for covered brand-name and generic drugs while in the coverage gap—the same percentage you pay from the time you meet the deductible (if your plan has one) until you reach the out-of-pocket spending limit (up to $4850 in 2016).
In 2017 you’ll pay 40% for covered brand name (it was 45% in 2016) and 51% for covered generic drugs. (it was 58% in 2016). The reduction continues down in 2018 with you paying 35% for brand name/44% of generic; 2019 you’ll pay 30% of the brand name/ 37% of the generic.
So, what counts towards the coverage gap? Your yearly deductible (if your plan has one), your prescription drug co-pays and/or co-insurance, the discount you get on brand name drugs in the coverage gap and what you pay for drugs in the coverage gap.
What doesn’t count towards the coverage gap? Your drug plan premium, any pharmacy dispensing fees and what you pay for drugs that aren’t covered by your plan. (for example; compounded prescriptions and the ever popular Viagra).
Remember, drug plans change their formulary (the list of drugs they cover and what price you’ll pay for them) every year. They will notify you the end of September if any of their changes affect you. Early October is the time to contact me for a no-cost review and plan analysis.
No, the birthday rule I’m referring to isn’t the one that means your friends and family need to be extra nice to you on your special day, it’s the one that means the insurance companies can’t decline you for coverage in their Medicare Supplemental plan if you are coming from another existing Medicare Supplemental plan.
For starters, generally there are two times you are “guaranteed issue” for a Medicare Supplemental plan. First is the 6 month window following your enrollment into Medicare Part B or leaving an employer group health plan. Second, is during the 30 days following your birthday going from one Medicare Supplemental plan (also known as Medigap) to another. When utilizing the birthday rule, you must select an equal to or lesser plan than the one that you currently have.
Why bother? Well, money is really the main factor here. Medicare supplemental plans are standardized to be the same no matter the insurance carrier providing the insurance. So, Plan F is the same no matter where you buy, same with Plan N, etc.
Medicare supplemental premiums go up every year as a result of a few things; as you get older, as Medicare covers less each year and the Medicare supplemental insurance companies have to cover more and also as the cost of care increases. Some Medicare supplemental plans stop giving annual age premium increases at age 75, some continue up into the mid-eighties. So, if you’re 80’ish, you may have a good chance of saving a significant amount of money each month by shopping around near your birthday. Double that amount if you do the same for your spouse!
You can also choose not to wait for your birthday and apply with a new company at any time during the year and you aren’t restricted to selecting a “like” or “lesser” plan, you can “trade up”. In this situation you will be asked health questions on the application, and your approval is based on your current health status.
If you’re interested in comparing prices (remember, the benefits won’t change at all going from one like plan to another but with a different carrier) please contact me for a fast and easy quote!
It’s a staggering number. According to the federal Government Accountability Office, Medicare paid almost $60 BILLION in fraudulent payments in just 2014 alone!!!! So, to get a full understanding of this sickening fact, let’s look at the “who, what, when, why and how”…
Who is responsible for the fraud? Providers of medical services are. Doctors, medical imaging companies, home health care group and individuals involved in elaborate schemes where they act as doctors to receive payment or individuals finding social security numbers and selling them to organized crime rings.
What constitutes the fraud? Billing Medicare for services never given to an individual, billing Medicare for unnecessary services, and Billing Medicare for services given to someone who doesn’t “exist”.
When will this end? The Affordable Care Act started the ball rolling. A lot of billing is now reviewed first prior to payments being made on claims. Site visits to high volume billing providers uncover false storefronts and payments are never made due to these findings. Insurance companies are sharing data with the government to help identify vulnerabilities and providers of concern.
Why is Medicare fraud hard to stop? 4.5 million claims a day come into Medicare and more than $1 billion in payments are made daily. That type of volume makes for extreme challenges especially in an open system like Medicare. Unlike Medicare Advantage plans that utilize networks which remove the risk of fraudulent billing, Original Medicare is required by law to allow providers that meet a base set of requirements to bill for services they give to Medicare beneficiaries.
How can you help? If you are on Original Medicare (Medicare Advantage members don’t need to worry about Medicare Fraud) inspect your Medicare explanation of benefits and bills. Make sure the services billed were received. If you suspect fraud, call Medicare’s hotline: 800-447-8477.
It’s been a long time since you mastered you’re ABC’s, but learning the ABC’s (and D too) of Medicare can make you feel like a frustrated school kid again.
Just like when you were young, repetition is key to learning and having the information sink in. You can’t just read about the different parts of Medicare once and expect yourself to remember each specific part. But many find Medicare extremely “boring” and don’t want to “deal with it”. If you’re that type of person I advise that you not to try to make sense of Medicare when the time comes without the help of a local professional. Or worse yet, do nothing at all by procrastinating. There are several costly mistakes that you can make, some that can affect you for the rest of your life.
Part A: Helps partially pay for inpatient hospitalization, skilled nursing facilities, home health services and hospice. Part A costs you nothing if you (or a spouse) paid Medicare payroll taxes for at least 40 quarters.
Part B: Helps partially pay for doctor’s services both in and out of the hospital and outpatient medical services such as physical therapy, diagnostic testing, chemotherapy, durable medical equipment and much more. You pay a premium for Part B. $121.80 is now the new standard premium for those making up to $85K a year that are single and up to $170K a year if they’re married. If you make more than that, you’ll pay more for Part B AND for your Part D coverage. If you have low income, you may qualify for help with your Part B premium and Part D drug costs.
Part C: Is offered by private insurance companies that the government goes into contract with. Part C gives you your Medicare benefits and more. It fills in a lot of the gaps of Original Medicare, and generally adds Part D coverage as well. You have to use networks to make Part C work favorably for you, and referrals are needed for the HMO plans. The upside to this is that there is a LOT of doctor and hospital participation here in Orange County and most Part C plans carry zero premiums. All you have to do is pay your Part B premium to the government.
Part D: Even if you don’t take prescriptions drugs, you must have a Part D plan in place or you’ll be subject to a late enrollment penalty. You can purchase a “stand alone” Part D plan or you can obtain it for zero cost if you enroll in a Part C plan that includes it. The most important thing about selecting your Part D plan is making sure you pick one that has all of your drugs covered at the lowest co-pays possible.
You won’t be automatically enrolled in Medicare Part B unless you took your Social Security at age 62. You are only enrolled in Part A when you turn 65 (and only enrolled in premium free Part A if you or your spouse paid into it for 40 quarters).
The reason this is the case now is because the age that someone gets fully vested into social security is increasing. It used to be age 65, so when someone applied for their Social Security benefits, Medicare would be notified that they were turning 65 and mail out a card with both Part A and B activated. If someone didn’t want Part B at that time (because of group coverage most likely) they’d sign the attachment refusing coverage.
What I find is happening now is that people expect their Medicare card to arrive with Part A & B activated automatically and both aren’t, their card arrives with only Part A activated. They may not look at it closely, they just tuck it away and when the time comes to enroll in a Medicare Advantage or Medicare Supplement plan, there is a “uh-oh” moment because they assumed they were all set to go and now they have to scramble to get to the Social Security office and get the Part B portion activated.
The protocol now for Part B to be activated is either going online to Medicare.gov to do that, or going in to the closest Social Security office. The earliest you can activate Part B is 3 months prior to your 65th birthday.
You must have both Part A and Part B active in order to enroll in a Medicare Advantage or Medicare Supplemental plan. Part A covers Hospitalization, Skilled Nursing and Hospice to some degree and Part B covers 80% of Outpatient and all Physician services. There is a lot of financial exposure having only Original Medicare and nothing else to fill in the gaps. Medicare doesn’t cover outpatient prescription drug coverage either, you have to enroll in a plan offered by a private insurance company. If you’re curious to learn more about your options when you turn 65, please call to schedule a consultation. My services are always free.
The networks that participate in Medicare Advantage plans are an association of physicians in private practice along with hospitals, labs and urgent care centers. These types of networks, even though they are referred to as an “HMO” are very different from the Kaiser/HMO structure.
Medicare Advantage plan networks deal with independent, private-practice physicians that are part of a coordinated network that works together to promote excellence in patient care. There are some really big networks here in Orange County. Most people that live in South Orange County would want to go to the Hoag, Mission, Saddleback, or UCI hospitals. All of these hospitals participate in Medicare Advantage plan networks. When I sit down with someone who is activating their Medicare Part B option for the first time (such as turning 65 or retiring) or looking to enroll in an Advantage plan during the annual enrollment period in the Fall, the first thing I ask is who their primary care physician and specialists are. The majority of the time their physicians are already participating in Medicare Advantage plan networks. (Such as Monarch, MemorialCare , Greater Newport Physicians, the most recently formed network; St. Joseph Hoag Health...just to name a few).
Some are concerned that their doctors will be upset if they go to a Medicare Advantage plan, as if they will be “cheating” their doctor out of something. That is simply not the case. To quote one of the doctors that I work with, “As it turns out, the Medicare HMO capitation is often better for the physician than the fee for service reimbursement”.....Capitation means the doctor gets paid MONTHLY when you enroll in a Medicare Advantage plan and have them listed as your primary care physician. They get paid whether they see you or not! If you use Original Medicare (with or without a Medicare Supplemental plan), they ONLY get paid when they see you! So for most doctors, a balanced “book of business (patients)” makes a lot of sense for them economically.
If you are turning 65 or retiring anytime in the near future, please call to schedule a no-fee consultation, it costs you NOTHING to enroll in your Medicare plan using my services. You’ll see why hundreds of people faced with the same decision as you feel relieved and happy that they took the time to meet with me.