Making Sense of the Medicare Maze

By Rodney Bakken, Director of Operations, Cornerstone Senior Services –

Making Sense of the Medicare MazeMedicare is a complex maze. It’s intimidating. Some say thinking about Medicare is like remembering their root canal work. Read on for some hope!

Medicare Open Enrollment Period is October 15 to December 7! This puts pressure on good people, who sometimes make poor decisions based on bad information. It’s hard to function well under the stress of an “act now!” scenario. Fact is, MOST people on Medicare can only change their plan once each year. Once! It’s not the necessity to act that gets most people lost in the maze. The challenge is making a decision based on knowledge. Unless you love legalese and poring over Government publications, you’ll not enjoy trying to make sense of Medicare. This is where a licensed, certified and appointed professional Agent is worth his weight in gold to you.

There’s nothing as safe as going through a dangerous maze with someone who knows exactly where to safely walk. That’s Mark– your personal guide.

Medicare Overview.
Note: Medicare was never designed to take care of all your health care needs or expenses.
. Part A = Hospital Insurance.
. Part B = Medical Insurance.
. A & B together are called “Original Medicare”.
. Part C = Medicare Advantage – private plans
contracted with Medicare – called Advantage Plans because they may offer extras Original Medicare doesn’t (e.g. they often include drug coverage).
. Part D = Prescription Drugs.
. Medicare Supplement / Medigap – private plans that fill the ‘gaps’ of Original Medicare (e.g. pay the 20% that Medicare does not pay).

Medicare Part A – Hospital
• For a hospital stay, the deductible is $1,184 per benefit period. A deductible is what YOU pay, before Medicare pays anything.
• You could pay this several times a year. The $1,184 covers you for up to 60 days at a time.

Medicare Part B – Medical
• Standard Premium = $104.90 / month – can change due to your income. Premiums can increase yearly.
• 2013 Deductible = $147 / year.
• Coinsurance – you pay 20% of charges you incur. Medicare pays 80%.
• PART B PENALTY – if you don’t take part B when you retire, you can face a 10% penalty, per YEAR, for the rest of your life. 3 years late = 30% more. That adds up!
• For Medicare to work financially, every retiree must participate. That way, there’s a larger revenue base to draw from in order to pay medical claims. When Medicare was created, there were about 4 workers per retiree. Now there are about 3.4 workers per retiree.

To recap – Part A covers HOSPITAL, Part B covers MEDICAL – together that’s called “Original Medicare.” It’s an 80/20 plan. In general, the government pays 80% of the cost of care, and you pay 20%. Also, deductibles and premiums go up each year.

KEY POINT: there is no cap on your expenses with Original Medicare! There is no maximum out of pocket! That’s important to know as you think through your financial plans for the future.

Medicare Part C – Medicare Advantage defines Part C: “This is a type of Medicare health plan offered by a private company that contracts with Medicare to provide you with all your Part A and Part B benefits.”

• ADVANTAGE plans often have more benefits than original Medicare.
• Some plans charge no monthly premium. Sound too good to be true? It’s not – here’s why:
• Medicare PAYS these plans to take care of you! So, it might be a zero premium to you, but Medicare IS paying for your care monthly.
• Most Part C plans include Medicare Parts A, B and D. So one plan covers hospitals, doctors and drugs.
• Part C plans may offer extra coverage like vision, hearing, dental, and/or health and wellness programs. My parents have a YMCA membership included with their Part C plan.
• Part C plans have co-pays –money you pay out of pocket to see doctors, or take tests.
• Part C plans have set maximum out-of-pocket limits!

Medicare Part D – Drugs
• Offered by companies contracted with Medicare.
• Drug plans have a monthly premium.
• Drug plans have formularies – the list of covered drugs.
• Make sure your drugs are on the formulary. A licensed, appointed and certified Agent is a great resource to help you compare plans and formularies.
• You can get a standalone Drug plan, OR one that is part of your Medicare Advantage plan.

Medicare rules are complex! There’s a common mistake people make, which leaves them with drug coverage, but cancels their Medicare Advantage plan.

Call Mark Keadle for details.

Medicare Supplement / Medigap Plans
• These are plans from insurance companies.
• Plans generally pay the 20% ‘gap’ that Original Medicare doesn’t pay.
• These plans have letters attached to them, like
Plan F, for example. Each plan “letter” must offer the same benefits nationwide.
• There is a monthly premium – and it increases yearly.
• There is no drug coverage.
• KEY POINT: You can never be dropped due
to bad health or claims!

We all want to live long, full lives. Have fulfilling relationships. Keep our mobility. A huge key to this is our personal health. And our Medicare coverage is of extreme importance to our health as we age.

If you have any dissatisfaction with your current plan, even if you just want to see if you can possibly save money on your current premium – Mark is delighted to be your resource.

That’s a brief Medicare intro. You can see why I call it the Medicare Maze. Unfortunately, the maze changes each year! Good news though – Cornerstone has the experience to help you break through the maze. And find the answers.

Medicare Open Enrollment is HERE! So, I have to say – “ACT NOW!” Contact Mark, and he’ll help you navigate your options.

Mark Keadle
District Manager

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