Author: Joe Boden
A Financial Advisor’s Perspective...
Each Fall, Medicare Open Enrollment begins on October 15th and runs December 7th, which provides eligible people to choose a new Medicare insurance option. Any changes you make go into effect as of January 1st, 2024.
As financial advisors, we know that evaluating Medicare insurance coverage can feel overwhelming. To help add clarity, we have a short primer to help you understand what you should expect and how you may want to evaluate a Medicare plan.
What Is Medicare Part A vs Part B?
Medicare part A and B are pretty straight forward. Part A covers hospital stays and some home health care services. Part B covers 80% of the cost on services such as doctors’ visits, surgeries, medical equipment and supplies like a wheelchair. Choosing the right supplemental insurance to cover the 20% of medical cost that part B doesn’t cover is where it gets tricky and should be reviewed each year.
Choosing Medicare for Those Turning 65
For those who are turning 65 soon and need to sign up Medicare, the dates above do not apply. When initially applying, you can start the process three months before the month of your birthday and you have until three months after you turn 65. If you miss this window, the next opportunity to apply will be January 1st and premiums may be higher for signing up late. Even if you already have medical coverage through your employer or your spouse, you still need to apply for Medicare part A (which is free) to avoid penalties later.
Four Considerations when Choosing a Medicare Plan
- Is your primary care doctor and your specialists included in your network? Make sure to ask when you’re evaluating your insurance options.
- Premiums, deductibles and copays. Some insurance has a higher monthly premium but a minimal copay amount when you need medical services. Others have a low monthly payment but have a high deductible that you must pay before the insurance company starts covering the cost. A big reason to review insurance during open enrollment is if your medical situation has changed. Maybe you originally signed up for a low premium plan because you rarely went to the doctor. But now your health has changed and you require more medical attention. The high deductible you are now paying might be costing more than if you switch to a plan with a higher monthly premium but a low/no deductible.
- If you weren’t taking any medication before, you may not have signed up for Part D drug coverage. Starting in October will be your opportunity to add Part D if now you are regularly taking medication.
- Hospital Coverage. One last consideration is the hospital network you want to be in. Most people have a preferred hospital based on proximity and reputation.
Medicare Explained - How EP Wealth Can Help You Choose a Medicare Plan
Here at EP Wealth Advisors we can help you navigate some of these important decisions because we offer our clients Medicare Analysis as part of our Financial Planning Capabilities. Feel free to reach out to your advisor for assistance in this area.
Additional Medicare Resources
For more details about important Medicare costs, visit:
https://www.medicare.gov/your-medicare-costs/medicare-costs-at-a-glance
https://www.medicarefaq.com/faqs/medicare-advantage-vs-medicare-supplement/
DISCLOSURES
The information represented here is limited in nature and used for illustrative purposes only. It is intended to serve as a tool containing general information that should assist you in the development of subsequent discussions with the appropriate professionals. The information contained herein is not comprehensive and should not be regarded as a complete analysis of the subjects discussed.