Posted by Shmully Schwartz
So I’ve heard that there are insurance carriers that will cover the 20% of your healthcare costs that original Medicare doesn’t cover. Is this true?
Yes. Medicare will pay insurance companies upwards of $1,000 a month for managing your Medicare. This means that the insurance carrier will replace, or takeover, your Medicare Part A and Part B and will add additional benefits to entice you to join their plan. This is called a Medicare Advantage plan or Medicare Part C. Some of these plans do not have a monthly premium and many of them are an HMO type plan where you have a primary care doctor who refers you to specialists as needed. The most alluring element of this type of plan is that it usually has a $0 monthly premium. Free.
I’ve also heard that there is something called a Medicare supplement insurance policy. What is that?
Medicare supplement insurance will actually cover the 20% that original Medicare (parts A and B) doesn’t cover. So when you go to the doctor, for example, you show your Medicare card and your supplemental insurance card. Instead of the insurance carrier taking over your original Medicare and filling in the gaps, the supplement will leave your Medicare as is and add additional insurance. The benefit of this plan is that it allows you to see any doctor that takes Medicare as opposed to the Advantage plan that usually requires you to be in a network. The drawback of this plan is that it can be quite expensive and isn’t affordable for a lot of folks.
Well which one is better: A Medicare supplement or Medicare Advantage?
There are many insurance carriers and types of plans out there and there is no absolute best. There is only what’s best for you, and that depends on a few factors such as your prescription medications, your doctor, how often you travel etc.
As you well know, this is a complicated subject for a lot of folks but I’ll continue to try and keep it simple and shed light on any upcoming changes in Medicare.
11.3.13 at 12:03 pm |
4.24.13 at 5:04 pm | Exciting information on the ins and outs of group. . .
3.13.13 at 12:19 pm | Thoughts on the respective opinions of both. . .
2.14.13 at 9:22 am | So I’ve heard that there are insurance carriers. . .
2.3.13 at 2:14 pm | Many of you have heard about a new place to buy. . .
1.14.13 at 12:27 pm | In our previous post we spoke about Obamacare,. . .
4.24.13 at 5:04 pm | Exciting information on the ins and outs of group. . . (2)
2.14.13 at 9:22 am | So I’ve heard that there are insurance carriers. . . (1)
3.13.13 at 12:19 pm | Thoughts on the respective opinions of both. . . (1)
February 3, 2013 | 2:14 pm
Posted by Shmully Schwartz
Many of you have heard about a new place to buy health insurance starting at the end of this year called the exchange. As part of the Affordable Care Act (Obamacare), starting in 2014 ALL Americans must have a minimum amount of health insurance or be taxed by the government. The law also requires each state to have a health insurance exchange where people can buy health insurance.
Let’s think of the exchange for a minute as an airline ticket search engine. You enter your information based on family, age, geography and tobacco use, instead of airport city and date. The search engine then brings you plans based on four different metallic tiers, bronze, silver, gold and platinum. From the lowest premiums and least amount of coverage for the bronze tier, to the highest premiums and highest level of coverage on the platinum tier: A higher level of coverage means a lower deductible, lower out of pocket maximum, and more prescription drugs covered.
The bronze tier will cover 60% of your healthcare, silver – 70%, gold – 80% and platinum – 90%. Additionally, all of these plans are “guaranteed issue” meaning the insurance carrier can not deny your application due to any preexisting conditions. Furthermore, the government will subsidize the cost of your insurance based on your income. The less money you make the more credits and subsidies the government will give you.
If all goes as planned, exchanges will open for enrollment on October 1, 2013 and coverage effective dates will begin January 1, 2014.
The government will also offer another type of exchange where employers can buy group health insurance for their employees. This exchange is the Small Business Health Options Programs, or SHOPs, for short. Tax credits will increase for employers with 25 or fewer employees and the credit will cover up to 50% of the employer’s cost. Employers will be eligible for credits in the first two years they offer coverage through an exchange.
Now if an employer with a large group (50 or more employees) does not offer minimum coverage to full-time employees, and at least one employee gets subsidized coverage through an exchange, then a $2,000 penalty is assessed for each employee (after the first 30).
So starting in 2014 there are three ways for folks to get health insurance. 1) Get coverage through their employer, if available. 2) Buy a plan through either: The individual market exchange or the traditional market. 3) Go uninsured and pay a penalty.
The penalty in 2014 for going without health insurance is $95 annually or 1% of taxable income whichever is greater. In 2015 the penalty will be $325 or 2% of taxable income. In 2016 the penalty will be $695 or 2.5% of taxable income.
As the year progresses and more information is available, we will in turn keep you informed!
Have a great week! Please post comments below.