logo

Helping People Find the Best Medicare Insurance
A fee-only financial advisor

1-877-236-7710

Contact us by e-mail

Identifying the Medicare Advantage plans that meet your needs

Medicare Advantage plans are usually the lowest-cost option for people who don’t have employer supplemental coverage. In 2013 more than one-half of the people enrolled in Advantage plans have no premiums for their medical and drug coverage. Their only costs will be for co-payments, co-insurance and in some cases deductibles. Also, preventive tests and screenings are covered 100% by Medicare. If someone is in good health, uses relatively few medical services and does not take expensive drugs, his or her costs should be low.

When someone enrolls in an Advantage plan, the plan replaces Medicare’s coverage for as long as he or she is enrolled in that plan. Medicare pays Advantage plans a certain amount for each enrollee, and the rules require that the plans cover the same benefits that traditional Medicare does. But plans can have different cost-sharing than Medicare’s, as long as their overall benefits are as good. In addition, some plans cover services such as routine dental and vision care that Medicare does not cover.

More than one-half of Advantage plans are HMO’s, where the coverage is for services provided by the plan’s networks. Before seeing specialists, patients usually must get referrals from their primary care physicians (emergencies are exceptions). Other types of Advantage plans include Preferred Provider Organizations (PPO’s), Private Fee-for-Service (PFFS) plans, Special Needs Plans, and Medicare cost plans.

Advantage chart

Most Advantage plans include prescription drug coverage. When people enroll in Advantage plans that include drug coverage, they need to make sure that the plans do not have high costs for the prescriptions they take.

Before you enroll in an Advantage plan, you should know the answers to the following questions:

  • are your doctors in the plan’s network?
  • does the plan have an adequate provider network?
  • does the plan have low costs for the prescription drugs that you take?
  • does the plan have a low out-of-pocket limit?
  • does the plan have good quality ratings by Medicare?

Using Medicare's Plan Finder to Compare Advantage Plans

This file has step-by-step instructions for using the Medicare web site to find the Advantage plans that are available in your zip code. If you want to see Advantage plans’ costs for the prescription drugs you take, do not use these instructions. Instead, follow the instructions under “Using Medicare’s Prescription Drug Plan Finder” on the Part D Plans web page.

.

Managing Medicare’s Costs

  • What Medicare does not cover

    Medicare’s history is one of gradually improving coverage. One reason is that new benefits have sometimes been needed to keep pace with medical advances. After studies showed that continuous glucose monitoring devices help diabetics control their blood sugar levels, Medicare said it would cover them.

    In other cases, benefits have been added to respond to an emerging need. In 2003, one out of four retirees did not have any prescription drug coverage. And many seniors had stopped taking one or more of their medications because they could not afford them. That in turn led to the creation of Medicare’s prescription drug benefit – Part D.

    Sometimes Medicare can cut costs by enhancing its benefits. The Affordable Care Act provided free preventive tests and screenings for Medicare beneficiaries because Congress believed that it would save money in the long run.

    All told, there have been hundreds of upgrades to its coverage since Medicare began in 1965. But with a few notable exceptions, most have been minor changes. And there is still a fairly long list of medical services – from acupuncture to wisdom teeth extractions – that Medicare does not cover.

    It can be helpful for retirees to know which services are not covered by traditional Medicare, and whether there are other ways to get coverage, perhaps in a Medicare Advantage plan. Here is a list of frequently used services that are not covered by traditional Medicare:

    Long-Term Care (LTC). Medicare does not cover custodial care, which is care for individuals who need help with the activities of daily living. More than one-third of people will need long-term care at some point, according to statistics published by Morningstar. And that estimate does not include unpaid long-term care that’s provided by family members. Medicare does, however, cover medical care for people in nursing homes and assisted living facilities. And it covers stays in skilled nursing facilities following hospitalizations.

    If at some future point you require long-term care in a nursing home, there are three possible ways to pay for it, and many retirees use a combination of all three:

    Pay out of pocket. A ballpark estimate is that a semi-private room in a long-term care facility costs $100,000 a year, although that number may vary quite a bit depending on the level of care and the state you live in. To get a more accurate cost estimate for the state you live in, check out Genworth’s 2019 Cost of Long-Term Care Report.

    The average nursing home stay is just over two years, but the median stay is less than six months. That means there are a large number of stays that last a few weeks or months, and a small number that last several years.

    Rely on LTC insurance to pay some or all the costs. Only 7.5 million people have LTC policies today – that’s compared to more than 50 million people who are 65 and older. And even though the total number of insured lives has slowly been increasing, the number of new LTC insurance policies sold each year has been declining.

    You can also invest in an annuity or life insurance policy that has a long-term care rider. And if you never need long-term care, the life insurance or annuity will keep their full value. The downside is that if you do have a LTC stay, the payout will be less than with traditional LTC policies.

    Qualify for assistance from Medicaid. Six out of ten nursing home residents count on Medicaid to pay some or all the costs for their long-term care. Even those who have LTC insurance will sometimes exhaust their benefits and spend their resources down to the point that they qualify for Medicaid. Unfortunately, the eligibility rules for Medicaid LTC assistance are not only complex, but they are different in each state.

    After long-term care, the next largest coverage gaps are for dental, vision, and hearing care. These three types of care are covered by most employer retiree plans, and they may be the next major additions to Medicare’s coverage.

    In December of 2019, the House passed a resolution that will add Medicare benefits for these services, but the Senate has yet to vote on it (and may not do so). Below are summaries of traditional Medicare’s current and very limited benefits for these three services.

    Dental care. Medicare does not cover routine dental care or dentures. But it does cover dental work if the teeth or jaw have been damaged by a disease or in an accident. Elsewhere, most employer retiree plans include dental coverage, as do 60% of Medicare Advantage plans.

    The Kaiser Family Foundation reported in a 2019 study that more than 10 million enrollees had access to dental care through their Advantage plans (some plans charge an additional premium). Before enrolling in an Advantage plan to get dental benefits, make sure that your dentist will accept the plan’s coverage.

    Continue reading this post

Recent posts

Topics

© 2010-2018 Dover Healthcare Planning, LLC | Contact Us

Site by COPY & DESIGN