Medicare expenses

[engr]

Good morning,

I am trying to come up with a reasonable line item estimate for when I get to 65 and apply for Medicare. Presently, I'm paying for Cobra at $1735/month, I am 61 years old.

I know Part A is "free" , Part B is approx. $105/mo.

The medicare supplement plan is variable. Looks to me that Plan F is probably the best choice (?) since it appears to be the most expensive. Is there anything better? I'm not a veteran.

My DW has a chronic condition so I need to have very good medical coverage.

I know Part D is for prescriptions. Is there a maximum out of pocket expense for Part D?

I'm a beginner at understanding Medicare. For now I estimated $11K/year but this is a WAG (wild a** guess).

What is a reasonable dollar amount use for estimating my yearly Medicare line item expense (max out of pocket)?

Thanks for your input.

 

[bingybear]

I'm not near the medicare time of life, but listening to my MIL.. part B and maybe D may be means tested. Thus you would have to take your tax situation into account for estimates. This would include RMD when you get to that point

 

[braumeister]

I know Part D is for prescriptions. Is there a maximum out of pocket expense for Part D?

Naturally, there is not a simple answer for that.
Costs in the coverage gap | Medicare.gov
Doughnut Hole Calculator - Calculator for Medicare Part D Drug Coverage Gap, Online Tool, Info for Seniors - AARP

 

[kaneohe]

see here: https://medicare.oneexchange.com/medicare/quote/search-supplement-medicare-plans

A 65 yr old today would pay roughly $50-150/mo. for a medicare supplement plan which is a bit less than COBRA.

 

[RonBoyd]

There is a plethora of help online but you probably should start at Home - Centers for Medicare & Medicaid Services to get it "straight from the horses mouth."

 

[aja8888]

Supplemental Plan F (not the high deductible version) is the best, especially if you or your wife has a chronic health problem (ask me how I know).

Part D varies in cost and typically has a $325 deductible to start, then there is the doughnut hole encounter for those that need a lot of meds. Read about it.

Search here or on Bogleheads as there are a lot of threads on Medicare.

 

[rodi]

Is your plan to get an ACA plan between the end of COBRA and the beginning of Medicare? Also, is your wife the same age as you? Unless you have birthdays in the same month - one of you will go on Medicare prior to the other.

 

[aja8888]

Is your plan to get an ACA plan between the end of COBRA and the beginning of Medicare? Also, is your wife the same age as you? Unless you have birthdays in the same month - one of you will go on Medicare prior to the other.

Good point, I wonder if the OP understands that Medicare coverage is per person and not like a dependent type insurance plan.

 

[FIRE'd@51]

I know Part D is for prescriptions. Is there a maximum out of pocket expense for Part D?

IMO, this is probably where the greatest exposure under Medicare lies, since there is no out-of-pocket maximum on prescription drugs. There is a catastrophic phase after you pass through the doughnut hole at which point you pay a maximum of 5% of the cost of the drugs for the remainder of the year. If you are on an expensive cancer drug that costs $10,000 a month, it will cost you $500 a month while in the catastrophic phase. By the time you reach the catastrophic phase, you will have spent about $2,700 out-of-pocket on your drugs.

 

[haha]

Good morning,

I am trying to come up with a reasonable line item estimate for when I get to 65 and apply for Medicare. Presently, I'm paying for Cobra at $1735/month, I am 61 years old.

I know Part A is "free" , Part B is approx. $105/mo.

The medicare supplement plan is variable. Looks to me that Plan F is probably the best choice (?) since it appears to be the most expensive. Is there anything better? I'm not a veteran.

My DW has a chronic condition so I need to have very good medical coverage.

Know that your Medicare coverage will not cover your wife. Medicare is for the individual receiving it, and each individual is separately covered. You wife can qualify based on your work record, but she must be 65 and any supplement programs will be separately applied.,

Ha

 

[haha]

I'm not near the medicare time of life, but listening to my MIL.. part B and maybe D may be means tested. Thus you would have to take your tax situation into account for estimates. This would include RMD when you get to that point

This is correct. Both B and D will increase if your income 2 years earlier is above certain non-inflation adjusted levels, There are some exceptions that can be applied for.

Ha

 

[Buckeye]

A supplemental policy for DH in the Tampa Bay area is $183. Moderate range drug plan is $49. Since he is such a low consumer of healthcare, he decided to go with an Advantage plan. Costs only the $105 Part B premium and max out-of-pocket annually of about $6,000. Dr. visit co-pay $15, specialist $60.

 

[aja8888]

A supplemental policy for DH in the Tampa Bay area is $183. Moderate range drug plan is $49. Since he is such a low consumer of healthcare, he decided to go with an Advantage plan. Costs only the $105 Part B premium and max out-of-pocket annually of about $6,000. Dr. visit co-pay $15, specialist $60.

There are reasons why Advantage plans are so cheap. Switching to a Supplemental plan later if one really needs good healthcare, etc, may be a big problem, and you may only get in with medical exclusions, if at all. MY BIL just had a heart transplant. Try that with an Advantage plan. Good luck!

 

[REWahoo]

There are reasons why Advantage plans are so cheap. Switching to a Supplemental plan later if one really needs good healthcare, etc, may be a big problem, and you may only get in with medical exclusions, if at all. !

+1

I view Medicare Advantage plans as a one way transaction: once you get in you better hope you're happy with it because it may be almost impossible to get out.

 

[Options]

+1

I view Medicare Advantage plans as a one way transaction: once you get in you better hope you're happy with it because it may be almost impossible to get out.

My mother has been on MA plans since 65, and she is 82. She recently had a very mild stroke and they're all over her with care. She's happy with the care she's received. Then again, up until the stroke, she had almost no utilization other than routine check-ups and tests.

 

[RonBoyd]

Medicare Advantage vs. Medicare Supplement

Do benefits change? Is the plan renewable?

Medicare Advantage:
Benefits may change yearly. You usually remain in a plan unless you disenroll during the Annual Election Period (AEP).

Medicare Supplement:
Benefits don't generally change. Guaranteed renewable as long as you pay the premium and the application was correct. No Annual Election Period (AEP) for Medigap plans. However, if you drop this plan, you might never get it again.

The Medicare Annual Election Period (AEP)

 

[MBSC]

The Medicare Advantage Annual Election Period (AEP) comes with "guaranteed issue rights" only during the first year of enrollment. This is known as the "trial right." If you attempt to go back to Medigap during a later AEP, you can be subject to higher premiums, pre-existing condition exclusions, and refusal to sell a policy. At that point, the person would need to qualify for a Special Enrollment Period (SEP) to retain their guaranteed issue rights.

guaranteed issue rights | Medicare.gov

Medigap & Medicare Advantage Plans | Medicare.gov

 

[aja8888]

One message for the Medicare Advantage plan people here to remember is that even though you are in good health at 65 when you sign on for the $104.90/month, everything's covered special plan is that you will get older and you will get sick, and maybe very, very, sick. And you will die at some point.

Having the ability to choose your doctors and procedures at age 65 and beyond is far more important that saving a few bucks each month on insurance costs.

At 65 is the time in your life, healthy or sick, to sign on and get the absolute best coverage and that would include the best Medigap policy available.

 

[REWahoo]

Having the ability to choose your doctors and procedures at age 65 and beyond is far more important that saving a few bucks each month on insurance costs.

+1

This is one of the last places I'd cut back on spending if times got tough.

 

[bmcgonig]

There are reasons why Advantage plans are so cheap. Switching to a Supplemental plan later if one really needs good healthcare, etc, may be a big problem, and you may only get in with medical exclusions, if at all. MY BIL just had a heart transplant. Try that with an Advantage plan. Good luck!

Could you elaborate on this? I don't understand..do you mean that you get better healthcare access on a supplement plan than on the advantage plan? Aside from paying more out of pocket? Thanks.


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[aja8888]

Could you elaborate on this? I don't understand..do you mean that you get better healthcare access on a supplement plan than on the advantage plan? Aside from paying more out of pocket? Thanks.


Sent from my iPad using Early Retirement Forum

It is hard to determine "Better", but having choices helps determine that. It's been covered many times in threads here and on other sites like Bogleheads. Do a search, the explanations are out there.

You may not even pay more out of pocket if you have a plan like Plan F and have a costly medical event. Plus, you can pick your doctors and other services. May not seem like a big deal, but wait until you have cancer, some other disease, or need an organ replacement. Those things are in the future of older people, unless you get lucky and die in an accident or suffer a critical life ending event.

 

[MichaelB]

Could you elaborate on this? I don't understand..do you mean that you get better healthcare access on a supplement plan than on the advantage plan? Aside from paying more out of pocket? Thanks.

To add to aja8888's response, the insurer business model for Medicare Advantage plans is to restrict the network of service providers and the drug formulary. In other words, not every doctor or hospital will take your insurance, not every drug is covered, and some drugs will cost you more out of pocket. You may also need pre-approvals.

This is the only way they can make any money. If you cannot afford a supplemental plan, this may not be a bad option. If your insurance objective is to have broadest coverage, a Medicare Supplemental plan is usually superior.

 

[FIRE'd@51]

To add to aja8888's response, the insurer business model for Medicare Advantage plans is to restrict the network of service providers and the drug formulary. In other words, not every doctor or hospital will take your insurance, not every drug is covered, and some drugs will cost you more out of pocket. You may also need pre-approvals.

Another point to consider is, unlike original Medicare with a supplement, you don't have the option to change just your drug (Part D) plan each year. I consider this a major loss of flexibility.

 

[Options]

OTOH, this reminds me of the choosing an HMO vs. PPO in an employer plan decision. Personally, I've had an HMO with the same primary care and specialist the entire time. Throughout this period, I had hernia repair surgery, all medications covered, and have been happy with the coverage.

Again, my 81 year old mother is an example of someone happy with her MA plan, even with switching plans.

I agree it's a highly personal choice, and if flexibility is your main concern (as in those who prefer PPO vs. HMO plans), then medicare supplements might be a better choice. I also agree when choosing an MA plan, as in choosing an HMO, it's important to research drug coverage. I've done so in both cases and have had no problem.