You’re 65. Now What?

You just celebrated your 65th birthday. It’s time for you to enroll in Medicare, but do you understand the various components of the Medicare program? Here are some guidelines from the July/August issue of the NYSBA Journal.

Medicare Part A is hospital insurance. It helps cover inpatient care in hospitals and skilled nursing facilities, hospice and home health care.

Medicare Part B is medical insurance. It helps cover doctors’ services, hospital outpatient care and home health care, as well as some preventive services to help you maintain your health and keep certain illnesses from getting worse. If you are currently employed and covered under your group insurance health plan, you don’t need to enroll for Part B now.

Medicare Advantage Plans (also known as Medicare Part C) are health plans run by Medicare-approved private insurance companies. These plans are similar to health maintenance organizations (HMOs) and preferred provider organizations (PPOs). They include Part A, Part B coverage, and usually other coverage like Medicare prescription drug coverage (Part D), sometimes for an extra cost.

Medicare Part D is the prescription drug option run by Medicare-approved private insurance companies. It helps cover the cost of prescription drugs and may help lower prescription drug costs and help protect against higher costs in the future.

So if you’re a working senior, what should you do when you turn 65? Should you maintain private health insurance or switch to Medicare? The decision is not an easy one, particularly for those enrolled in PPO plans because their doctors are not “in network.” The decision is further complicated by many factors, including analysis and comparison of the following costs:

Employer Plan:
• Employee premium cost
• Policy annual deductible
• Insurance company reasonable charge
• Co-insurance (Reimbursement is typically 80% of reasonable charge, but to keep costs down some employer plans now only allow 70% or 60%)

• Part B (physicians) and D (prescription drug) premium cost
• Medicare Part A, B & D annual deductibles and the “gap” for Part D
• Medicare reasonable charge
• Co-insurance (Medicare reimbursement is 80% of reasonable charge)
• Medigap policy premiums

Sound confusing? I turned 65 last year and had to go to my group health insurance agent to determine what worked best for me. This is a very complicated and important decision, and  you don’t want to make mistakes that may have unwelcomed repercussions.

Contact your agent, financial advisor or benefits manager at work for proper guidance. If you don’t have someone to turn to, look for an agent or advisor on LIFE’s website here.

Marvin H. Feldman, CLU, ChFC, RFC, President and CEO of Life Happens

by Marvin H. Feldman

Marvin H. Feldman, CLU, ChFC, RFC, is president of the Feldman Financial Group in Palm Harbor, Fla., and president and CEO of Life Happens. He is a 41-year Million Dollar Round Table member and was the 2002 president. He is a 33-year member of the MDRT Top of the Table and a past Top of the Table chairman. He also is the recipient of the 2011 John Newton Russell award, the highest honor bestowed on an individual by the insurance industry.

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