Medigap Questions

[scottyp]

After seeing some discussions about NOT signing up for Medicare Part D since "you" are not currently taking any prescription medications, I would like to share what my parents are dealing with. When Dad retired both were in excellent health so did not signup for Part D. Well, Dad is 91 and Mom just turned 90. For the past 10 years their health has changed (no surprise there), and they have both had to start taking meds. Both Mom and Dad have medication for some kidney failure problems (not unheard of later in life), blood thinners due to paroxysmal AF for Mom and TIA's for Dad (even post bilateral Carotid artery surgery). There are a couple of other medications Dad is on as well. Due to the out of pocket cost for the blood thinners, they are taking one that requires blood checks monthly to monitor how "thin" their blood is and then balanced with adjustment of their medication dose. (Coumadin). They have fewer choices of medications (in the same class of medication) due to their out of pocket costs. If they could afford a different blood thinner that would mean not having to drive and get stuck monthly checks (sometime twice a month depending on test results) which would be priceless. They are very independent, live in the same house they built 50+ years ago and still drive. They do not have smart phones so using Good Rx is not very doable for them (they are not technically inclined/interested and live in another state from me). Their medication costs are very high and the Part D premium savings certainly has not saved them in the long run. I've tried many times to help with their medication costs, but they refuse since they are "fine" financially (that's your money for retirement not ours). Sure, it made sense to them at the time Dad retired since they both were health and not taken any medications at all up to that point, but you just don't know what tomorrow has in store for you. Financially it is not killing them, but who know what medication prices anyone could be facing in the future.

[RetMD21]

Quote:

Originally Posted by scottyp After seeing some discussions about NOT signing up for Medicare Part D since "you" are not currently taking any prescription medications, I would like to share what my parents are dealing with.

One of the Boomer Benefits videos I watched said that the catastrophic coverage benefit of the part D might be worth it alone. Oral chemotherapy, for example, can cost thousands. Unfortunately delaying the purchase of part D results in higher premiums.

[Sue J]

Quote:

Originally Posted by scottyp They do not have smart phones so using Good Rx is not very doable for them (they are not technically inclined/interested and live in another state from me).

Do they have a computer? I just print out my GoodRx coupons and take them to the pharmacy.

So they have never signed up for a Part D plan? How bad is the penalty after all these years?

I remember trying to learn about Medicare before I turned 65. Our medications were all cheap generics and it seems silly to pay for a plan although I knew we'd need a Part D. Someone here referred to it as a "placeholder" because we all realize our future medications could be very expensive.

BTW, we both enrolled the the Aetna SilverScript SmartRx for $7.30/mo each. It was the cheapest Plan D and so far it's been fine for all but one of DHs Rxs and we use a GoodRx coupon for that one. I hope this plan is still available for 2022 even if the price goes up a little.

[audreyh1]

Quote:

Originally Posted by Sue J BTW, we both enrolled the the Aetna SilverScript SmartRx for $7.30/mo each. It was the cheapest Plan D and so far it's been fine for all but one of DHs Rxs and we use a GoodRx coupon for that one. I hope this plan is still available for 2022 even if the price goes up a little.

DH ended up getting two one time prescriptions this year, first time he’d used Plan D. And they were both not expensive so he was really happy with his cheap $7.30 a month Aetna Part D plan.

[scottyp]

It is too late for my parents to enroll in any part D program due to the late enrollment penalty.

From the CMS Website:

“ How’s the late enrollment penalty calculated?

Medicare, not the plan, calculates the late enrollment penalty when a person subject to the penalty first joins a Medicare drug plan. The late enrollment penalty amount typically is 1% of the national base beneficiary premium (also called “base beneficiary premium”) for each full, uncovered month that the person didn’t have Part D or other creditable coverage. The national base beneficiary premium for 2020 is $32.74. The monthly penalty is rounded to the nearest $0.10 and added to the monthly Part D premium.”

“Here’s the math: (numbers modified to fi my parents) 312 months since Dad turned 65 back in 1995.
3.12 (312% penalty) x $32.74 (2020 base beneficiary premium) = $102.15. $102.15 rounded to the nearest $0.10 = $102.20
$102.20 = my Dad’s monthly late enrollment penalty for 2020 (on top of the monthly premium for any part D plan he would choose)”

“In general, once Medicare determines a person’s penalty amount, the person will continue to owe a penalty for as long as he or she is enrolled in a Medicare drug plan. This means that even if the person decides to join another Medicare drug plan, he or she will still have to pay the penalty once enrolled in a new plan. This also means that if a person joins a plan that has a $0 monthly premium, he or she will still owe a penalty”. https://www.cms.gov/Outreach-and-Education/Outreach/Partnerships/downloads/11222-P.pdf

So enrolling my parents now would not be an option or fiscally doable. Until I did some research I didn’t realize how cumulative the penalty is (1% per month).

Scottyp

[Telly]

Quote:

Originally Posted by RetMD21 I applied for my Medicare card at 65 - 3 months and got the approval and number in a few days and the card in 2 weeks. The mailing from AARP/UHC is showing a that plan N would only save $20/month over G and L is a savings of about $30. I don't live in a state that allows no switches without underwriting so it makes sense to me to just get G now. .

I started with Plan G, but switched to Plan N when I dumped MoO. I passed underwriting to do so. MoO was hitting G with a 15% increase, N with 6% in my geographical area. I saw similar differences in rate increases G vs. N in some other states with them. In general, it is expected that increases in N will be less than G. And the difference may increase in time, as "G is the new F" as far as those who are coming into Medicare at ages greater than 65, who have the guaranteed issue right. For example, someone well over 65 who is retiring from their employer, and had qualifying health insurance through their employer, so they were not on Medicare when they were employed and age 65 or greater. The idea is that they tend to have higher medical expenses being older. Some in the industry point to that effect when Plan F was the guaranteed entry for those. Now it's Plan G. Besides being employed at or over age 65, I think there were other scenarios that had the same effect, I don't remember what they were.

Quote:

I don't live in a state that allows no switches without underwriting so it makes sense to me to just get G now.

A triple-negative sentence! I'm lost... can you please reword it? I'm not trying to be funny, I just can't figure it out, and I would like to know.

[travelover]

Quote:

Originally Posted by audreyh1 DH ended up getting two one time prescriptions this year, first time he’d used Plan D. And they were both not expensive so he was really happy with his cheap $7.30 a month Aetna Part D plan.

I switched to that plan and it provides a free prescription that I was paying cash for that cost about $7 a month, so the insurance is essentially free.

[audreyh1]

Quote:

Originally Posted by scottyp “Here’s the math: (numbers modified to fi my parents) 312 months since Dad turned 65 back in 1995. 3.12 (312% penalty) x $32.74 (2020 base beneficiary premium) = $102.15. $102.15 rounded to the nearest $0.10 = $102.20 $102.20 = my Dad’s monthly late enrollment penalty for 2020 (on top of the monthly premium for any part D plan he would choose)” Scottyp

Part D wasn’t available in 1995. Coverage started in 2006, so late 2005 must have been the earliest anyone could have signed up.

[RetMD21]

Quote:

Originally Posted by Telly I started with Plan G, but switched to Plan N when I dumped MoO. I passed underwriting to do so.

My issues with N are

1. No excess charge coverage for nonparticipating providers (I haven't found any detailed explanation of what is included in this and I suspect that it isn't a big deal financially)

2. No max OOP (K and L have this)

3. The copays would be a nuisance.

I'm not sure that I'll be able to meet medical underwriting in the future so I am inclined to favor G understanding that premium increases could be higher and the cost would be higher at least in the early years.

On the other matter is seems crazy to me that there isn't an upper limit to the late penalty for part D.

[CRLLS]

Quote:

Originally Posted by RetMD21 My issues with N are 1. No excess charge coverage for nonparticipating providers (I haven't found any detailed explanation of what is included in this and I suspect that it isn't a big deal financially) 2. No max OOP (K and L have this) 3. The copays would be a nuisance. I'm not sure that I'll be able to meet medical underwriting in the future so I am inclined to favor G understanding that premium increases could be higher and the cost would be higher at least in the early years. On the other matter is seems crazy to me that there isn't an upper limit to the late penalty for part D.

Regarding no.1: nonparticipating providers are those who will accept Medicare patients and insurance, but do not participate in "Medicare Assignment". Medicare assignment is where the Dr. agrees to the payment that Medicare says it should be. If not accepting Medicare Assignment, the Dr can bill up to 15% above Medicare's amount.

[Telly]

Quote:

Originally Posted by RetMD21 My issues with N are 1. No excess charge coverage for nonparticipating providers (I haven't found any detailed explanation of what is included in this and I suspect that it isn't a big deal financially) 2. No max OOP (K and L have this) 3. The copays would be a nuisance.

CRLLS has covered your 1. I'll add that providers that accept Medicare patients, but do not accept Medicare Assignment are rare. Using the Medicare.gov finder tool, one would have to search very hard to find one in my area!

2. Max OOP is not applicable to Plan N, nor F, nor G. I have no idea why someone would even consider Plans K or L! Those two have major issues! The simple table of Benefits vs. Plan letters shows it quite clearly. I respectfully suggest that our members here at E-R.org not even consider K or L. Plans K or L would be better than going barefoot, without a Medigap Plan at all if going the Original Medicare route. My personal opinion is one would have to be in dire straights to consider K or L, seems that the concept of an E-R and those two plans don't go together.

3. It depends. I'm willing to accept small copays (if indeed I have to pay them, so far only one Dr. office charges it to me), in trade for lower initial premium cost and lower future rate increases. Rate increases over the years, like raises to base salary, quickly build upon each other. It is something that one may consider in choosing what plan.

[REWahoo]

^ Adding to Telly's comments:

1. I've seen several sources saying providers who accept Medicare but not assignment (i.e., who may bill a Part B excess charge) number less than 4%. Barring an emergency situation it isn't difficult to determine in advance if a provider doesn't accept assignment and is one of the few who may charge the extra 15%.

3. I've been on N for three years and haven't found the $20 copay ($50 for an emergency room visit) to be a nuisance. Heck, several times a provider has apparently determined billing me for $20 isn't cost effective so I never get invoiced. YMMV of course.

[sengsational]

Quote:

Originally Posted by Telly 3. It depends. I'm willing to accept small copays (if indeed I have to pay them, so far only one Dr. office charges it to me), in trade for lower initial premium cost and lower future rate increases. Rate increases over the years, like raises to base salary, quickly build upon each other. It is something that one may consider in choosing what plan.

How much faith should one put in the proposition that the rate increases over time will be lower with plan type N? I guess the people that are the highest utilizers of services gravitate towards G, but isn't the Medigap provider only on the hook for a fixed maximum in both cases?

[teej1985]

Quote:

Originally Posted by sengsational How much faith should one put in the proposition that the rate increases over time will be lower with plan type N? I guess the people that are the highest utilizers of services gravitate towards G, but isn't the Medigap provider only on the hook for a fixed maximum in both cases?

Fixed maximum? Not really. It covers everything that Medicare approves but does not cover. There is no cap.

[RetMD21]

I don't know what services the excess charges apply to. Office visits and an occasional surgery are no big deal financially. What about chemotherapy administration or radiation treatments?

[REWahoo]

Quote:

Originally Posted by RetMD21 I don't know what services the excess charges apply to. Office visits and an occasional surgery are no big deal financially. What about chemotherapy administration or radiation treatments?

Excess charges are applicable only to Medicare Part B services. Take a look at Medicare.gov to see what Part B covers.

[jrhop]

Check out medigap seminars on you tube or online. Very informative to help make a decision.

[isisdave]

+1 for Plan N. As I recall, it cost about $40 less a month (remember, that's almost $500 a year -- a couple of days of vacation) than G, and so far I don't make 2 trips to the doctor per month. On routine care it's less than $20: if the allowed amount is under $100, Medicare will pay 80% and then the copay will be less than $20.

The "excess charge" cannot exceed 15% of the Medicare-allowed amount; some states don't permit them at all. I've never seen one charged.

Here's something no one has mentioned: premium rates are either "age-based" or "community based." The former will increase every 2 years as you age, PLUS inflation. The latter start out at what seems a little higher, and they WILL go up because everything goes up, but they don't go up because you got older.

Where I lived in CA, the only community-based plan available to us was AARP-UHC. We switched onto that when Blue Shield announced "happy birthday, now pay more"; it cost $250/month for two of us, age 70. Now in Indiana, there are more community-based choices and the premium for the AARP-UHC is 22% less. I do recommend them; their website is clean and easy, and they pay promptly and reliably.

[imnontrad]

I am really impressed with the insurance company "Boomer Benefits" that specializes in Medicare supplemental policies and is licensed in most states.

The agents do not work on commission so they have no incentive to recommend a policy based on any money they would make.

[msanniee]

“Also you are less likely to get hit with rate increases on the HD plan since it's generally a self-selecting healthier pool.”

I do have the HD plan and my increase this year was 10%.