The Complete Guide To Medicare For Those Approaching Age 65
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Why Work With An Agent On Your Medicare?
We usually think of retirement as the time to start winding down and reaping the rewards of a fulfilled career. In retirement, you may expect to have lots of time spent with family, traveling and doing your favorite hobby. However, there are vital matters to attend to before kicking back and relaxing.
One of those vital matters is addressing when, and how, to enroll in Medicare. Some people opt to do this on their own, while others rely on a Medicare agency like Buffer Insurance. You will want to choose the best Medicare Agency in Southlake to guide you through the process. We understand the nuances of the Medicare program and are aware of the variety of plans and how to best maximize the value you receive from them. Our clients enjoy a successful retirement because of our ability to ask questions, listen and give recommendations based on their specific circumstances. There is no fee for our consultation and we're the local resource for you on the Medicare program.
At Buffer Insurance, we believe that your future is important and that it is worth protecting. Serving you is our highest priority and it guides the way that we work with you to select a Medicare plan.
What Does Medicare Cost?
Many folks are surprised to learn that Medicare is not completely free - after all, "what were we paying for from our paychecks all these years?!" The taxes that are deducted from your paycheck while working help fund the Medicare program. However, there are several ongoing costs to participate in Original Medicare AND depending on the type of supplemental coverage you choose, there could be ongoing costs for medical or prescription coverage beyond Original Medicare.
You're probably wondering "what is Original Medicare," and that is an excellent question! You may have heard the terms Part A, B, C and D thrown around when the topic of Medicare comes up. Original Medicare is composed of Part A and Part B, and you'll have to establish these coverages with the federal government before deciding on supplemental policies to build your comprehensive coverage.
Part A is inpatient hospital insurance and most people get it free of charge because of their Medicare taxes paid over the years. We're not so lucky when it comes to Part B (outpatient/medical insurance), though. The standard price for Part B, which most people pay, is $170.10 per month in 2022, and this number usually goes up a bit from year to year. If you're a high-income earner, or an individual with limited financial resources (i.e. Medicaid, low-income subsidy, etc.), you may have a different Part B payment than the standard.
Individuals with an income that surpasses $91,000 per year, or $182,000 married/filing joint, pay a higher monthly payment for Part B and Part D than the standard costs. This is referred to as Income-Related Monthly Adjustment Amount, or as we call it, IRMAA. To see if you will have to pay an increased amount for Medicare, you can read more about IRMAA here.
So, now that you have an idea of what "Original Medicare" (Part A and B) will cost, you're probably wondering what benefits you get for the price tag. Part A has a per-instance deductible of $1,556 in 2022, which means you will be responsible for the first $1,556 each time you visit a hospital. If that's not enough to make your eyes water, Part B has its own cost-sharing structure. For anything done as an outpatient in a doctor's office, there is an annual deductible of $233 in 2022— not bad! However, after the deductible, you'll still be responsible for 20% coinsurance with no out-of-pocket maximum. This means you have an unlimited amount of exposure to medical bills.
Sadly, Original Medicare is not enough to cap your exposure to the costs associated with health care. Fortunately, there are plan options that place a ceiling on your out-of-pocket costs.
Medicare Supplement vs. Medicare Advantage:
There are two common pathways for coverage beyond Original Medicare - Medicare Supplements (aka Medigap) and Medicare Advantage (aka Part C) plans. Where Medigap plans fill in the financial gaps of Original Medicare, Medicare Advantage plans replace the cost structure of Original Medicare.
Both of the plan options serve to limit financial exposure to medical bills. We have put together an outline of the pros and cons of each below:
Medicare Supplement (Medigap):
Pros:
- Extremely robust in coverage. For example, on Plan G your only medical and hospital out-of-pocket expenses are $203 for the Part B deductible
- No referrals are required to see a specialist
- No insurance company network; the only question to ask your doctor is “Do you take Original Medicare?”
Cons:
- Prices continue to rise year after year. Usually between 5-7% depending on the insurance company
- You could be denied if you have chronic conditions and try to enroll outside of a guaranteed issue period; this approval process is called medical underwriting
- You will also have to purchase a standalone prescription drug plan since Medicare Supplement Plans do not have this embedded
- No vision, dental, or other extras as seen on Medicare Advantage Plans
Medicare Advantage:
Pros:
- Low or no premium for the plan
- Comprehensive coverage including hospitalization, medical and prescription drug coverage
- Additional benefits such as dental, vision and a gym membership
- No medical underwriting
Cons:
- May need to stay within a specific network to receive coverage — going out-of-network may not provide coverage
- May need a referral to see a specialist
When Can You Enroll?
Medicare is primarily geared toward seniors who are turning 65 and there are specific rules that determine how and when to enroll. Enrollment periods are the fancy way to describe the periods when you can adjust your coverage. There is an Initial Enrollment Period for when you first get onto Medicare. Additionally, there are Special Enrollment Periods for certain life events and the infamous Annual Enrollment Period that happens every year in the fall.
If you turn on the TV from October to the end of March, you've probably seen commercials that make you scratch your head and think "why is Captain Kirk telling me I can get all of my Medicare benefits for free"? There is a lot of confusion that comes up as a result of these advertisements, but what they are pitching are Medicare Advantage plans which you can make changes to between the middle of October and the end of March.
Becoming a client of Buffer Insurance means that we take the confusion out of this complex topic and help you navigate the timelines of these enrollment periods and to ensure that you enroll in a plan that will serve you well. If you find yourself wondering if now is the time to act on your Medicare, there's a good chance there's an enrollment window open for you to do so. We would be grateful for the opportunity to serve you.
Making Your Decision
Though hard to believe, this is just a bite-sized slice of the Medicare pie. In making your decision, you'll want to work with somebody that has the recipe and knows all of the ingredients that go into that pie.
A mistake that many people make when researching Medicare is that they put their contact information on a web form expecting to get pricing for Medicare plans. Instead, they're slammed with a barrage of phone calls from agents scattered all over the U.S. that are hungry to make a sale.
Buffer Insurance is focused on educating and assisting you through the entire process of enrolling in Medicare and choosing the best plan for you. We have a heart to serve and want to ensure that your transition to Medicare is a great experience.
If you're interested in speaking with us about your Medicare options, please give us a call at 214.238.4414, send us an email at Medicare@BufferInsurance.com, or request an appointment on our website.
