Are you approaching age 65?
If you are then you are probably discovering a new popularity that would make Tom Cruise jealous!
The calls and mailings will begin about six months before your 65th birthday. By three months beforehand the interest in you will have reached an all-time high. Every day brings a new mailing, phone call, or even a personal visit from an insurance agent knocking on your door. Everyone wants to congratulate you on reaching this new milestone in your life, and "by the way, can I help you understand your insurance options?"
What's the deal here?
Well, it just so happens that there's a very good reason for why everyone is so interested in you right now: you are about to enter (what may be) a one-time open enrollment period where you cannot be turned down by an insurer for supplemental insurance coverage, to go along with your new Medicare coverage. If you are unhealthy, you'll likely find this attention beneficial, but if you are like most consumers, it will be annoying.
Take heart, as soon as you turn 65 you'll become anonymous again. The marketers will then turn on the next round of new Medicare enrollees.
The Medicare System Can Be Daunting!
Medicare represents a major change in the way that health insurance will work for you. You're going to like most of these changes. You'll likely see monthly premiums decrease from what you have been paying for private health insurance, unless your employer has been providing it for you. I have seen personal premiums decrease from more than $700-800 a month to less than $250. Typically out-of-pocket costs will decline significantly, as well, especially if you have purchased a Medicare supplement.
Here's some things you need to know when it comes to Medicare supplements:
* The plans are uniform.
Medicare supplement policies are defined by federal law. What that means is that an F plan offered by Mutual of Omaha in Utah will have exactly the same benefits as an F plan offered by Aetna in New Jersey. That's good for the consumer. If you travel, and need healthcare, you can be sure that your insurance plan will behave exactly as you think it should. The only two variables you'll find in these plans is the amount that the company charges for a premium, and the level of personal service. So, shop around. Why pay $250 a month for a plan when you can get the same plan from another company for $120? You shouldn't (unless the agent you're purchasing the supplement from happens to be a relative).
* Your costs can be calculated and budgeted for.
Your monthly premiums, and out-of-pocket costs are known in advance by you, and can be included in your budget. For seniors on a fixed income, this can be a huge advantage. This may not be the case with Medicare Advantage plans (I'll discuss these in a future blog), where some out-of-pocket costs can be quite large, and not entirely expected.
* They are extremely easy to use.
There is usually nothing you, as the insured, need to do to access benefits, other than provide a copy of your insurance card to the doctor. You don't file claims, they do. Also, since the senior population in the U.S. is so large, doctor's offices know how to expeditiously handle these claims. They submit and process a lot of them.
* They are honored nationwide and are not limited to specific networks.
Medicare supplements are not limited to a network. You won't be told what doctor to see. Again, if you are a frequent traveler, this can be a valuable benefit to you.
Medicare is a BIG Subject
The information above, though I hope is helpful, is still limited, and applies only to Medicare supplements. There's a lot of information you should consider, and I'd recommend meeting with someone who can give you a good all-around education on what you need to know. Medicare supplement policies are not the only option you have, and your specific situation should be analyzed by someone reputable before making any decision.
I have condensed my typical Medicare education class that I do with clients. If you'd like to view it you can click the link below:
Feel free to take some notes from the video, and give me a shout if I can help answer any of your questions.
Until next time,
Are you a serious investor? Like to keep up with what's happening on Wall Street. Take a look at our commentary on what's happening in the market. Delivered weekly to your in-box!