Are You Turning 65 Shortly, Or Already On Medicare?

Hi folks. Let me try to clear up some confusion, out of the gate, by telling you that once you have Medicare, you don't have to re-enroll each year. You have it for life.

Towards the end of each year we'll see, again, (or hear) commercials talking about "annual enrollment periods." **There is no annual enrollment period for medicare. These never-ending commercials are speaking about limited, restrictive newly created (in 2005) Medicare Advantage Plans that are either changed or dropped every year since they started. Many have high maximum out of pocket costs, some reaching as high as $6700 a year. They all involve "a provider network" or mandate a doctor accepts the reimbursement the plan calls for.

Confusion reigns supreme between agents showing these plans and seniors trying to grasp what is being told to them.

Medicare supplements, on the other hand, have been around since the mid sixties when Medicare was signed into law by then president Johnson. They have a long and outstanding track record of picking up where Medicare left off, addressing the 20% that medicare didn't pay, co-pays, deductibles, foreign travel etc etc. Wonderful plans. The only medicare product with actual freedom of choice.

There is an old medical axium, "the greatest good for the greatest number."  That good, in my view, would be provided by modernized medicare supplement plans.

There are only two reasons a senior would apply for a so called "Medicare Advantage" plan. Reason #1..they had no idea that supplements/medigap plans existed (all they heard from the TV or the salesman was Medicare Advantage). Reason #2...cheap..often times no premium.  After 64 years on this earth. I realize that in life, you get what you pay for. Last year, our government spent over $9 billion more paying carriers who offer Medicare advantage plans, than if those same seniors were simply enrolled in Medicare and had a supplement or Medicare and Medicaid, if truly indigent. This is why major cuts in funding to Medicare Advantage programs will commence in 2012. Reimbursement levels in 2011 were frozen at 2010 levels.

So while it's "cheap" to the senior enrollee, the carrier is grossly overpaid each month, by our government, per enrollee, regardless of that senior enrollee's health. I like to refer to the overpayments as "Bush Pork."  To me, Medicare advantage plans are like an uninvited guest at the dinner table...beginning in 2005, vs supplements which have been around for 50 years.  I fully expect a decrease in payments to doctors in Medicare advantage plans, a reduction in benefits offered with these plans and increased premiums to go along with maximum out of pocket costs to senior enrolles in Medicare advantage plans.

So when you hear in a month or so about "Open Enrollment Periods" this pertains to managed care, restrictive Medicare advantage plans and nothing else. Normally people begin Medicare on the first day of the month they turn 65 (unless they are going on medicare due to disability and are under 65). Within six months of turning 65 or within six months of getting Part B to Medicare is considered an open enrollment YEAR AROUND..not just at the end of each year when medicare advantage permeates the airwaves around November about annual enrollment periods. (It's "annual" because they may not be around the following year). Very confusing to seniors and folks just entering medicare. 

I hope this helps to clear up some of the confusion. If you are enrolled in a Medicare advantage plan, you must remain in it for the entire year, even if you decide you don't like it. Medicare advantage is simply a year by year adventure into the unknown. I strongly advise NOT thinking about Medicare Advantage in the long term. Neverending, annual, rules, regulations, limitations and restrictions abound. The far more solid, reliable choice to supplement medicare, which has been around for 50 years is....that's right..a medicare supplement. Premiums are a fraction of what they were when you were working and had a major medical plan in place.

Personally I don't like being told what doctor I must use or have a potential $6700 maximum out of pocket each year.With that financial exposure, what does it matter if the medicare advantage plan asks for little or no premium.

The plan provider is being overpaid a fortune by our government for each senior enrollee. This must end. We are literally building roads and schools in Afghanistan (and who knows where else), while contemplating cuts to our senior's healthcare insurance because we are running out of funds. 

Congress should be hiding their faces in shame. Advisors in the insurance industry are told not to evaluate it, just sell it. I don't work that way. I listen to the senior. Every person is an individual, not a head of cattle. I make recommendations and suggestions and offer guidance regardless of whether or not a senior wants to apply for any plans with me. As a semi-retired broker, I've seen a lot. I can be reached at 312-335-0063 if you have any questions on today's topic. Be well until next time....

                                           Glenn Posner