Should I have a Medicare Advantage Plan or Medicare Supplemental Coverage?
I was eligible for Medicare in 2014, and 5 years later I am able to understand and appreciate all the nuances involved. On January 1st, 2020, I changed from a supplemental plan to a Medicare advantage plan. I will be curious whether I will realize the $3,000 savings I expect!
10 days into the new year, the situation looks promising.
What does Medicare cost?Basic medicare costs a bit more than $100 - in 2020 my cost is $135. Since I had already signed up for, and was receiving, my Social Security pension, the medicare premiums were deducted
But medicare is not supposed to be an all-inclusive health insurance plan. There are limits and co-pays.
What are Medicare Supplement Plans ("Medigap")?Medicare supplemental plans are defined by the government as (Ahem!) plans A, B, C, D, F, G, H, I, J, K, L, M and N. (There is no plan "E.") I am not going to review differences between the plans. You can get first-hand information from the Medicare.gov website and thousands of private ones, too.
Each insurer must meet the minimum standards for that plan. However, I am not aware of anyone who has exceeded expectations. The take-away is that these plans are now commodity items, and should be shopped by price and your perception of the insurer's dependability and reliability.
The touted advantage of Supplement plans is that patients can go to any doctor, anywhere in the United States without needed a referral or a co-pay.
$3,000/year ~ $250/month.
My solution for the last five years were supplemental plans. I chose plans D and F from United Health Care, and purchased them through AARP. My decision was partially based on me having United insurance through my employer when I was working full time. Here is a breakdown of my costs:
- Medicare Part A ~ Free
- Medicare Part B: $1,500/yr (withheld monthly from my social security check)
- Plan F: $2,400/yr (paid by me by check at $196 per month)
- Plan D: 600/yr (withheld from my Social Security at $54 per month)
- AARP: $25/yr (paid by me by check at $75 for 3 years
- Prescription Co-Pays: About $180/year (don't have an exact total)
During the last five years I paid no out-of-pocket medical expenses for either doctor visits or lab work. My stent in 2017 was paid 100%, as have been my annual cardiac checkups and tests since then.
What are Medicare Advantage Plans?The government halfheartedly wants to get out of the "insurance" business. I'm not really sure about the politics or economics of this decision, nor are the "whys?" part of this discussion.
Medicare contracts with private insurers for them to assume the entire risk of managing a person's health care and the associated expenses. They pay a monthly premium to the insurer. There may be public information somewhere, but I haven't had the interest to dig that out. It doesn't matter because I can't change it, and I never see any of it.
The take-away is that companies will compete for that business! What's interesting is that some companies even offer to reimburse the Medicare Part B premium ($135/month this year).
The challenge is that there is NO standardization. Different companies offer different combinations of benefits with differing co-pays and out-of-pocket costs.
Now is when/where the company's dependability and reliability does make a difference!
An Advantage Plan is basically an HMO, with its own pool of doctors, co-pays, and referral system. If a doctor is not part of that network then the patient either changes physicians or pays the full cost out of their own pocket. It is buyer beware, and people must do their own "due diligence."
I chose a Baycare Medicare Advantage Plan!
I started my Medicare advantage plan effective January 1, 2020 through Baycare. This was based primarily on three things:
- I don't expect a loss of coverage, or a significant change in care
- My primary physician is already in the Baycare network
- Baycare has an extensive network of specialists scattered over a 2-county area
- I've been getting my blood work done through a Baycare lab
- My only ER experiences in the last fifteen years have been at a Baycare hospital that is 5 miles from my front door.
- I did not trust the claims and did not want to rely on the promises from the Baycare Advantage competitors
- I expect a significant cash savings of $3,200/year. In 2020 I expect to pay:
- Medicare Part A ~ Still Free
- Medicare Part B: $1,600/yr (withheld monthly from my social security check)
- Plan D: $0.00 (not eligible)
- Plan F: $0.00 (not eligible)
- Advantage Plan Premium: None
- Prescription Co-Pays: None
- I have additional benefits that are provided at no cost. This could be worth another $1,000.
- Over-The-Counter (OTC) store. I have a $200/year benefit to get free medical "stuff" from an online store. It is doled out at the rate of $50 per quarter, and if I don't use it I lose it. So far I've ordered ~ and received ~ fish oil and vitamins that I would have purchased out of my own pocket at Walmart or Amazon.
- "Silver Sneakers" - this is plan that provides free health club memberships. In the first 10 days of January, I have signed up for free memberships at a health club that is within walking distance of my house (Fitness 360) and at the Long Center, a Clearwater facility that has an indoor Olympic size swimming pool
- Dental Insurance - I'm not going to rant about public misconceptions about the "insurance" name for dental coverage, but I expect to have savings and discounts here, too. There is a network that I must use, but that's OK. Dental work is not as personalized as physican care. My first appointment is Monday.
- Vision Coverage - This is supposed to give me "free" eye exams every year, plus a free pair of glasses every two years. This could be an additional $200 benefit.
The Baycare Advantage plan comes in two flavors. The one I did NOT choose has slightly higher deductibles but refunds a monthly check equivalent to the Medicare Part B premium. That's $135/month ($1,620/year)! I will revisit that decision in 2021.