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When someone first becomes eligible for Medicare, they have the choice to sign up for part B.  Part B of Medicare covers physician and outpatient services at 80% after a $144 deductible.   Part B doe have a cost which is $104.90 a month. (deducted out of your social security check or billed quarterly)

Should everyone sign up for part B?  The answer is no.  Anyone that 65 or older and actively working may get stronger coverage from their employer.  If they are actively at work, they do not need to sign up for part B.   They can wait until they retire and sign up then. There will not be a penalty because they are actively at work. (same goes for someone getting benefits from an actively working spouse)

If you are getting benefits but not actively at work, you will be accumulating a penalty for not taking part B when you are eligible for it. The penalty is 10% of the premium for every year you are eligible but do not elect part B.    This may be a problem if you ever lose your retiree coverage and need to sign up for B down the road.

Aetna has one of the better MAPD plans in Connecticut.  The copays are lower than their competitors, the new work is national and the plan is administered well.  While the plan looks great on paper it was not a good option for people living in and around New Haven. Read more

Most people are eligible for Medicare when they turn age 65. Being eligible for Medicare means you will be able to get Medicare Part A and B. If you are already receiving your social security payments, you will be signed up for Medicare A and B automatically.  If you are not electing your Social Security benefit, you will need to take a few steps to get signed up.

First off, you need to have worked and paid Social Security taxes to be eligible for Medicare part A.  You may also qualify through a spouse that worked 40 quarters.  There is no monthly premium for Part A.   Part B can then be elected for a cost of $104 a month per person. (can be more based on income)

As stated, if you already get Social Security payments, you will automatically be signed up.  The effective date of your Part A and B is the first of the month you turn 65.  If you have not elected Social Security, you will need to call your social security office and tell them you want to sign up.  You may also go online to get this accomplished for those that rather use the web.  The site to go online is here CLICK FOR MEDICARE.GOV SITE 

Once you are signed up, you need to then determine how you want to cover the gaps in Medicare A and B and determine if you want drug coverage.  There are 3 basic categories of choices:

• Buy a Medicare Supplement plan (Medigap) and a stand alone drug plan
• Sign up for a Medicare Advantage plan (Managed Care Plan)
• Sing up for a part D plan only

Medigap plans also called Medicare supplement plans are secondary to Medicare insurance plans offered by private insurance companies.  The plans are standardized in most states and range from plan A to N.

Traditionally, plan J (now a retired plan) and plan F have been the most popular as they both cover 100% of secondary costs not covered by Medicare.  Plan F can be costly with an premium ranging from $170 a month to $250 a month depending on the state you live in.

There are lower cost alternatives that are worthy of consideration.  The plan L supplement has only been around for a few years and is not well know but it should not be ignored.  Plan L premium is about 1/3 the cost of plan F.  (Around $120 a month) ($114.25 in CT)  It covers 75% of the costs not covered by Medicare and has a total out of pocket limit of $2,400 per year.   A 25% cost share may seem like a big risk at first glace but it is more than reasonable if you consider how Medicare bills costs.

Plan L covers 75% of what Medicare does not cover.  For part B of medicare, it will cover 75% of the 20% Medicare does not cover.  This leaves the insured with a 5% cost share.  Further, the 20% cost share is based on what Medicare allows the provider to charge. It is not based off the regular rate.

Under Medicare Part A, the hospital deductible is $1140 which Plan L covers 75% of.  This leaves only $285.00 for the insured to pay.   Part A covers at 100% for the first 60 days of hospitalization after the deductible is met so there is little risk of owning any more than $285.00

My personal experience with clients using plan L has been overwhelmingly positive.  Clients that do not use many medical services for the year experience huge savings over plan F and those that utilize a lot of services rarely spend more than than the premium savings vs. a plan F.

Plan L is a solid choice for those that want to take the time to understand why it will save them money.

Medicare Supplement plans (Also called Medigap plans) have been around for many years.  Plan F Supplement which is offered by a number of companies is the most popular supplement mostly because it covers 100% of medical expenses not covered by Medicare.

Utilization for people with plan F has trended much higher than that of other supplements.  If someone is paying for a plan that will cover all of their Medical expenses, they are probably going to be more inclined to go to the doctor or get a test than someone who has a cost share.   Given that Medicare is primary when using a supplement, people with a plan F supplement are utilizing more than someone without a plan F supplement.

At one point, I thought Medicare Advantage plans would be phased out over the next few years but now it is time to admit that I was way off.  Cost share plans are the ones that will be around and it is the covered in full plan F that is going to be on the chopping block.

I predict that 2014 will be the last year that Plan F will be offered.  I am sure it will be grandfathered to those that already have it but they will no longer offer it to new customers at some point in 2014.

Medicare Supplement Plans (also called Medigap) are plans offered by private insurance companies to supplement original Medicare.   The plans help pay some or all of the coinsurance, copayments and deductibles in original Medicare. Some plans may also cover cover services that original Medicare does not cover.  Here are some key things you need to know about Medicare Supplement plans. Read more

Medicare Advantage plans in various markets have been cancelled or discontinued for January 1, 2013.  If your Medicare plan was cancelled, you still have an opportunity to enroll in a new plan.   Losing a plan due to a discontinuance, qualifies for an SEP period (Special Election Period) which runs through Feb. 28 2013. Read more

Medicare charges premiums for various benefits.  In most years, the premiums are increased. The attached document provides the premiums for Part A of Medicare (most people do not need to pay a Part A premium),  Medicare part B premium (Most people do pay Part B premium unless they receive drug or copay help from the state) and the Medicare part D drug base premium. Read more

The original Medicare A and B benefits are updated every January.  The benefits do not change drastically from year to year but they usually increase slightly . The changes are made areas such as the Medicare Part A Inpatient Hospital Deductible, daily skilled nursing home copy, annual Medicare part B deductible, etc….. Read more

Annuities are often used to generate lifetime income streams for retirees.   SPIA’s and Income Riders are the two main ways to accomplish a lifetime income stream for a single person or for a couple.  Here I will explain how both work and the positives and negatives of each.

SPIA- (Single Premium Immediate Annuity)   A SPIA is one of the oldest types of annuities and are used exclusively as a tool to generate a lifetime income stream.  The concept is simple: The annuitant gives an amount of money to the insurance company and in return, the insurance company provides the annuitant with a lifetime income stream that they can not outlive. Read more