Your Insurance … with Michele Campbell: Learn about the small details that go into choosing Medicare plans

Click HERE to read stories published in the May 29 – June 11, 2019 issue of Gilroy Life

Are you new to Medicare? Are you turning 65 or just now retiring? You might be feeling a little overwhelmed if this is your first time looking at Medicare and how it works.

There is a lot of information out there and can be very confusing when you’re first learning about it. First you need to enroll in Medicare, a few months prior to turning 65, or if you’re collecting Social Security, you will be automatically enrolled and your card will be sent to you. Once you get enrolled in the Medicare system, then you can purchase either a Medicare Advantage plan or a Medicare Supplement and a Part D prescription drug plan.

Which plan do you choose? Medicare Advantage vs. Medicare Supplement? Are you confused, A, B, C, D…  What does all this mean? Let me break it down for you.

Original Medicare = Part A & B These are the only parts that are provided by the government. If you’ve worked your 40 quarters, which equals 10 years, then Part A should be free.  Part B has a standard rate of $135.50, but can be higher based on income. You can check by downloading this document from Social Security to check what your Part B premium will be: www.ssa.gov/pubs/EN-05-10536.pdf

Once you know this number, you will get a better idea of what your costs are for retirement planning.  Many people are surprised about this cost and haven’t planned well enough.

Part C is a Medicare Advantage plan. In California, these are typically HMO plans, however, they can be PPO plans also. These plans are considered Managed Care, where you pick a Primary Care Physician, which belongs to a network or two.  You pick which network you want to work within. Once you’ve picked your doctor and start using the plan, you have to get referrals to doctors and stay within that network. If you choose to go out of network, then you won’t have any coverage with the HMO’s. If you’re on a PPO, you can go out of network, but you’ll pay more for services.

With Medicare Advantage plans, you have deductibles and copays as you use the plan. Sometimes there are no copays, such as for preventative services, where you don’t pay anything. For bigger ticket items, like inpatient hospital, outpatient surgery, MRI’s, etc., you typically have larger copays. For smaller cost items, like x-rays and lab work, they can be $0 or small copays. Most advantage plans include a Part D drug plan, so you’ll satisfy that portion that Medicare requires that you have.

Medicare Supplements are not HMO or PPO plans. Supplements are secondary to Medicare, who’s primary and typically pays your claims first. The supplement can also pick up your deductibles and coinsurance that Medicare doesn’t pay. There are various plans but the most popular are Plan F, G and N. These plans are guaranteed renewable, which means it will never go away, unlike the Medicare Advantage plans, which can change from year to year and can even go away. These plans do not cover medication you pick up at the pharmacy, so you’ll need to add  a Part D drug plan also.

There is a lot more detail that goes into these plans, but this is a good start to compare the differences. Another common comparison is that advantage plans often cost a lot less than a Supplement, especially as you get older because supplements go up as you age. Advantage plans have one rate for the plan, no matter your age.

Michele Campbell is the owner of Michele Campbell Insurance. Contact her at michele@mcInsuranceServices or call (408) 848-2271.