Medicare; what will it cost when I get there?

[ivinsfan]

I still have a couple of years, so still have time to read up on this Medicare thinggy.

But I just read that the standard premium of Part B is only 1/4 of the true cost. I also saw that IRMAA is not all that scary for high-income people.

Medicare may look expensive compared to ACA, but that is because the subsidy formula of ACA is all messed up. I don't think they intended for it to be that way, but in the rush to pass the law they made a booboo. Do you really think any of our esteemed legislators actually read and understood the whole thing? Or did they just tell some young staffer "go read this thing tonight and tell me in the morning if anything looks bad"?

Being shocked and upset by the cost of Medicare isn't a new thing or an ACA thing.. If you have or had generous employer HI , the cost of Medicare can be a surprise. On of my BIL bragged that he paid a total of 150 bucks for his DD braces. And yes, he was shocked and unhappy when he realized what Medicare with supplement times two was costling.

 

[SumDay]

Medicare premiums are very expensive when adding in the various parts and supplemental. I'm loosely planning $500/mo for just me, which is 10X what I'm currently paying for good health insurance and more than double ACA marketplace premiums that I have calculated when factoring in the premium tax credit.

Due to escalating health care costs at a much faster increase than inflation, I'm actually thinking about kicking my estimate up another $100 to $600/mo, so that's $7200/yr for one person in today's dollars.

DH is paying
Medicare part B: $135.50 (50 cent increase over 2018)
Humana Supplement F: $146 (goes up $5 or $10 a year - $185 deductible)
Silver Scripts Part D: $30
Total: $311.15

I'm not yet 65, so I am paying $519 a month for my ER Retiree Med, with a $1500 deductible and a $3000 OOP. Looking forward to Medicare in 28 months.

 

[NW-Bound]

Being shocked and upset by the cost of Medicare isn't a new thing or an ACA thing.. If you have or had generous employer HI , the cost of Medicare can be a surprise. On of my BIL bragged that he paid a total of 150 bucks for his DD braces. And yes, he was shocked and unhappy when he realized what Medicare with supplement times two was costling.

Yes, some people are spoiled because they are shielded from the true cost of healthcare.

When they are faced with the true bill for the cost, that's when they bawl their eyes out.

 

[Which Roger]

I wished it only went up to $144.30 next year for my wife. Unfortunately, we sold our house last year when we moved out of state, and we saw a good sized capital gains tax bill for 2018 (yes, beyond the exemption for house sales).

Making that much on the sale of the house was the good news. The bad news is that income level will be applied for 2020, so for one year, my DW's Medicare monthly premium is going to spike in 2021. Thankfully, it will be a one year event. Something to think about regarding Medicare costs as you headed into retirement and are considering a downsize to your house you may have owned for a long time.

I recently attended a Medicare seminar where the presenter addressed such a situation and claims that you can appeal since your actual income now is nowhere near what it spiked to in that one year. I don't know the details of the process, or the success rate, but seems worth investigating in your case.

 

[SheitlQueen]

And don't forget Part D, you get penalized if you don't sign up. Make sure your employer will pay for anything Medicare doesn't, plus the 20% copays, plus possible Medicare overages if the doctor bills medicare but doesn't accept it's amount paid.If your employer doesn't cover all that, think about a supplement plan.

 

[SheitlQueen]

I recently attended a Medicare seminar where the presenter addressed such a situation and claims that you can appeal since your actual income now is nowhere near what it spiked to in that one year. I don't know the details of the process, or the success rate, but seems worth investigating in your case.

I just started Medicare and got caught in IRMMA because of an inheritance I got two years ago. They send you a letter describing what occurances allow you to appeal, but things such as house sales and inheritances aren't one of them. I'm bummed, but at least it goes away in a year.

 

[SheitlQueen]

DH is paying
Medicare part B: $135.50 (50 cent increase over 2018)
Humana Supplement F: $146 (goes up $5 or $10 a year - $185 deductible)
Silver Scripts Part D: $30
Total: $311.15

I'm not yet 65, so I am paying $519 a month for my ER Retiree Med, with a $1500 deductible and a $3000 OOP. Looking forward to Medicare in 28 months.

I got caught in IRMMA because of an inheritance two years ago, but I should be paying:
Mediare B: $135.5
UHC Part G: $129
Part D: $15.40 (which I acutally don't mind, my medications are all tier 1 so the are free, and I was paying $15/month for them before, so this is a wash).

Total: Should be $279.9 after IRMMA goes away. I was paying $257 for a Silver ACA plan before that was terrible-in net work only, no coverage outside the state except for emergencies, and huge copays/ deductible. I'm happy to pay more for medicare for a better plan. I've already started using it.

 

[skipro33]

You really need to check out the details of what I have bolded.

I base the premise on other, older retirees and on the benefits booklet they mail to me each open enrollment period. There they describe each of the options I can choose from. I am very fortunate with this retirement benefit; there are 7 health care options I think. From Kaiser to Blue Cross, United Health Care, Dignity Health, Blue Shield, and a couple others I can't recall right now. There are HMO and PPO options with some of these mentioned even. Some cover me if I decide to move out of California. Others don't. Plus each of those have 'Senior Advantage' style coverage once the retiree reaches 65. The older retirees tell me the coverage is the same, but that Medicare is taken out of the SS check, making those 65 and older pay a larger portion for their health care from that time forward.

 

[Teacher Terry]

A advantage plan may not let you go out of network for special treatment you may need. The only people I know that chose it are poor.

 

[CardsFan]

I base the premise on other, older retirees and on the benefits booklet they mail to me each open enrollment period. There they describe each of the options I can choose from. I am very fortunate with this retirement benefit; there are 7 health care options I think. From Kaiser to Blue Cross, United Health Care, Dignity Health, Blue Shield, and a couple others I can't recall right now. There are HMO and PPO options with some of these mentioned even. Some cover me if I decide to move out of California. Others don't. Plus each of those have 'Senior Advantage' style coverage once the retiree reaches 65. The older retirees tell me the coverage is the same, but that Medicare is taken out of the SS check, making those 65 and older pay a larger portion for their health care from that time forward.

Looks like you have done your homework, so my concern was unfounded. Sounds like a great plan.

 

[John Galt III]

So after all your research you went with a Medicare Advantage program. Was the $0 cost the deciding factor?

REWahoo, yes, it was the $0 premium. Intellectually, it makes more sense for me to pay the extra $130 per mo for a UHC Plan N and a Part D, and have way better coverage than a Medicare Advantage plan, but...... $130 times 12, every year. I still have some time to change to a Plan N, without underwriting, so I can agonize about it more if I want to, lol. Same decision factors : is it worth extra $130 per mo? Will I need it and when? You never know when something's going to happen, etc, etc, etc ad infinitum.

 

[wmc1000]

Both DW and I are 66. Total medicare, drug and supplement G cost per mo. is a total of $506. While that is significantly higher than our ACA premiums due to controlling income, it is not overwhelming. Even with the $185 deductible for both of us and an average of about $8 per mo. for drug costs under part D, the approx. $6600 per year seems very reasonable to us.

 

[REWahoo]

REWahoo, yes, it was the $0 premium. Intellectually, it makes more sense for me to pay the extra $130 per mo for a UHC Plan N and a Part D, and have way better coverage than a Medicare Advantage plan, but...... $130 times 12, every year. I still have some time to change to a Plan N, without underwriting, so I can agonize about it more if I want to, lol. Same decision factors : is it worth extra $130 per mo? Will I need it and when? You never know when something's going to happen, etc, etc, etc ad infinitum.

I definitely understand what you are wrestling with. Life is full of tough choices.

For me, the $130 a month would be well worth it due to the fact a $0 premium advantage plan likely has no limits on what I may have to pay out of pocket for co-pays, etc. One serious illness could make that $130/mo look like a real bargain.

Also, advantage plans limit the choice of hospitals and doctors, and that freedom to choose has real value to me.

 

[ivinsfan]

I definitely understand what you are wrestling with. Life is full of tough choices.

For me, the $130 a month would be well worth it due to the fact a $0 premium advantage plan likely has no limits on what I may have to pay out of pocket for co-pays, etc. One serious illness could make that $130/mo look like a real bargain.

Also, advantage plans limit the choice of hospitals and doctors, and that freedom to choose has real value to me.

It's kind of a pay me now or pay me later issue for me. Add that to the fact if you get a big medical problem you can't switch out to a plans with better co-pays and OOPs. I don't really like the way it shakes out. Doesn't seem too user friendly.

 

[GenXguy]

For the record, it may be 10x what you are paying ($50/month?), but $500/month is still reasonable compared to the actual costs.

Yes, about $50/mo now through my employer health care coverage, although I do have a $100/yr deductible and some copays such as $20 office visits, but I normally only make one office visit per year. Of course, I know my employer pays much of the actual premium cost, which is why my leave of absence or COBRA health care premium jumps closer to $600/mo. But I have to budget around my personal cost.

When I mention the ACA premiums and the $500 to $600/mo Medicare costs, I"m not referring to supposed true costs (so far I only make one office visit per year, so my true health care costs are low compared to my premiums) nor am I factoring in that I paid 35 years worth of Medicare taxes over my career. I'm just figuring my own personal costs for my FIRE budget.

I have over a decade to go until I'm old enough for Medicare, so I'm planning way ahead, although it's just "loosely" planning since things can change. The same is true with the ACA, even more so considering there's a lawsuit ruling pending and likely appeal afterwards.

 

[Katsmeow]

REWahoo, yes, it was the $0 premium. Intellectually, it makes more sense for me to pay the extra $130 per mo for a UHC Plan N and a Part D, and have way better coverage than a Medicare Advantage plan, but...... $130 times 12, every year. I still have some time to change to a Plan N, without underwriting, so I can agonize about it more if I want to, lol. Same decision factors : is it worth extra $130 per mo? Will I need it and when? You never know when something's going to happen, etc, etc, etc ad infinitum.

Agree with REWahoo on this. Also Teacher Terry has a point

A advantage plan may not let you go out of network for special treatment you may need. The only people I know that chose it are poor.

The bottom line is that some people need $0 supplements because they can't afford the premium for a supplement. But in return they are severely constrained in who they can see and often have high co-payments.

With my plan G, yes, I pay a premium and I am responsible for the deductible then I am done and can see any doctor/hospital who accepts Medicare (which in my experience is most of them). One of the best things about going on Medicare is not having to worry about networks or balance billing. No way on earth I would want to deal with that again unless I was so poor that I just couldn't pay a premium. Note that the $0 premium plans can end up being more expensive than a premium if you do end up getting sick.

 

[ivinsfan]

Agree with REWahoo on this. Also Teacher Terry has a point



The bottom line is that some people need $0 supplements because they can't afford the premium for a supplement. But in return they are severely constrained in who they can see and often have high co-payments.

With my plan G, yes, I pay a premium and I am responsible for the deductible then I am done and can see any doctor/hospital who accepts Medicare (which in my experience is most of them). One of the best things about going on Medicare is not having to worry about networks or balance billing. No way on earth I would want to deal with that again unless I was so poor that I just couldn't pay a premium. Note that the $0 premium plans can end up being more expensive than a premium if you do end up getting sick.

We had this whole discussion when JG posted asking for opinions. But it doesn't hurt to repeat part of it for newbies who wonder how you get a free Medicare "supplement".