medicare-choice (1)

Making the Right Medicare Decisions

Hello and welcome to this week’s episode of the Her Retirement Podcast. This week I am talking about Medicare and the Medicare maze that we are all so confused about. I’m also recording this as a video, so you can go check it out on YouTube. After you’ve thrown on some headphones and listened to the podcast, you can go and take a look at a video of me chatting about it also, and I’m going to include a link to a Medicare workbook in the transcript of this podcast so that you can reinforce the concepts I’m going to be covering today. So are you preparing to embark on a Medicare journey within the next 12 months, but you’re finding it challenging to navigate this super complex landscape? Well, you don’t have to look any further. I got you. We’re gonna help you get her done. I’m going to attempt to simplify Medicare and enrollment for you.


So who is this for? Well, it’s for anyone seeking clarity and understanding of Medicare, regardless of age or background. It’s particularly beneficial for those who are ready to apply for Medicare and specifically people who are 64 years old and preparing for enrollment or who’re under 65 and living with a disability. Okay. So what you’ll learn in this podcast or video is understanding how Medicare functions and operates, identifying Medicare plans that align with your unique health budget and location, and determining the optimal plan suited to your needs regardless of your financial status. And we will discover strategies to avoid errors, penalties, and crucial deadline oversights. So let’s get this Medicare Party started. We’ll start by talking about original Medicare, which has two parts, part A, hospital coverage, and part B, medical coverage. Part A is inclusive coverage for hospital care, including inpatient services, hospice care, and select skilled nursing care.


Part B medical coverage is extensive coverage for those essential medical services such as doctor visits, lab tests, x-rays, provision of oxygen, hospital beds, preventative services like colonoscopies, and the ever-important mammograms. So Part A hospital Medicare Part A is often mistaken as being free, but it’s important to clarify that it is not free of charge. The truth is that you have paid in for Medicare Part A through your contributions made via your payroll taxes during your working years. If you or your spouse have worked and paid payroll taxes for a minimum of 10 years, you have already fulfilled the payment from Medicare Part A. Individuals who have not worked for full 10 years or who have not made sufficient payroll tax payments may be required to pay some or all of the expenses associated with Medicare Part A. This can result in expensive costs. So part B, medical Medicare Part B requires payment, and the amount you pay depends on your earnings.


In 2023, the majority of Medicare beneficiaries, over 90%, will pay approximately $165 per month for Medicare Part B. However, if you have a higher income, your monthly payment for Medicare Part B may exceed $165. It can range anywhere from 200, 300, 400, or it can even surpass $500 a month. The specific amount is determined based on your modified adjusted gross income two years ago. So your Maggie from two years ago is important to note that this payment date difference based on income can really catch some individuals off guard. It’s crucial to be aware that your monthly costs for Medicare Part B may not align with what others are paying. Your income determines it from two years ago. Some individuals with low income do receive assistance from their state to cover the cost of Medicare Part B. As mentioned before, the vast majority, around 90% of people in 2023, will pay approximately $165 a month for Medicare Part B.


If you receive social security benefits, the monthly premium from Medicare Part B is automatically deducted from your Social Security payments. For those not receiving social security benefits, the payment process may be slightly more complex. When relying solely on government Medicare, you are responsible for paying 20% of all Medicare Part B costs. The government covers the remaining 80%, which may initially seem favorable. However, it’s essential to recognize that the 20% you are responsible for is not capped. This means that for significant medical expenses, your out-of-pocket liability could potentially amount to thousands or even hundreds of thousands of dollars. While it’s not my intention to alarm you, it’s crucial to acknowledge that government Medicare alone may not provide you with sufficient coverage. There are gaps in limitations within government Medicare that can leave you exposed to substantial costs. So I highly recommend exploring supplemental coverage options to fill the gaps in government Medicare and protect yourself from potential financial burden.


Okay, let’s talk about Medicare coverage limitations. What’s not covered? The significant gap in original Medicare A and B lies in the 20% patient responsibility for Medicare Part B services. Imagine paying 20% of each chemotherapy, radiation, or dialysis treatment. The cost can quickly escalate due to the frequency and duration of these treatments. Original Medicare A and B do not provide coverage for prescription drugs. To address this gap, you must purchase a separate private insurance plan known as Medicare Part D, which offers prescription drug coverage. However, even with Medicare Part B, you still need to pay 20% of the cost for certain drugs, which are typically expensive medications like those used for U, rheumatoid arthritis, osteoporosis, or chemotherapy. Original Medicare A and B do not cover dental services, including cleanings, exams, and X-rays. No dental coverage is provided at all, while original Medicare A and B cover certain vision conditions like cataracts, macular degeneration, and glaucoma.


They do not include routine eye exams. These exams are essential for detecting eye conditions in their early stages, which of course, if not identified in early stages, can become big expensive issues. Medicare A and B do not cover hearing services, including hearing exams and the cost of hearing aids. Hearing aids can be expensive, and Medicare offers no assistance in this area. Medicare does not cover any cosmetic procedures like getting rid of some of those wrinkles or some of those extra layers of fatty tissue or services considered medically unnecessary. So what are some options to fill your Medicare coverage gaps? Well, it’s crucial to acknowledge the limitations of the original Medicare, which is why individuals opt for supplemental coverage to fill the gaps. Of course, you have to evaluate this based on your personal situation, and you can evaluate this each and every year as your healthcare conditions change.


And this is probably a good time for me to note that because of all these medical costs in retirement and as we age, this is why I really focus on women in particular because my platform’s called her retirement, but focus on being healthy. Her. If we can focus on our health, we can obviously live a better, happier, more physically enjoyable retirement in later life, but we can also reduce our healthcare costs. I think it’s something like 10% of disease is genetic, and 90% is within our control. So if you can prioritize not only your wealth but your health, you are going to protect your retirement savings, and you’re going to spend so much less on healthcare costs. So get out there, move, exercise, care for yourself mentally, physically eat right, sleep, and drink water. Speaking of, I’m gonna take a little sip of water myself. Okay, so various options are available to supplement government Medicare, providing comprehensive coverage.


Generally, you’ll face a choice between two paths. One option is to purchase a Medicare supplement plan, also known as Medigap or supplemental plans, which work alongside government Medicare. The other option is to explore private Medicare, referred to as Medicare Advantage PPOs or HMOs. Selecting the right path is a critical decision that may have long-term implications. It’s essential to carefully consider your own options as it might be a lifetime decision with limited opportunities for changes later on. So option one is Medicare supplements. This plan serves as an additional layer of coverage alongside your existing original Medicare. Essentially, you retain your enrollment in government Medicare parts A and B while obtaining a private insurance plan to address the gaps in coverage. By acquiring a private insurance plan, you ensure comprehensive coverage that compliments and enhances your existing Medicare benefits. So let’s talk about the benefits of Medicare supplements.


Number one is unrestricted healthcare access. The most significant advantage of Medicare supplements is the freedom to choose any doctor and hospital nationwide. This unparalleled flexibility is highly appealing to individuals seeking comprehensive healthcare options. Number two: enhanced financial security. Medicare supplements fill gaps in original Medicare, mitigating the risk of high out-of-pocket expenses by providing additional coverage. These plans offer greater predictability and a clearer understanding of your healthcare costs. Number three is simplified and standardized coverage. And a noteworthy development of Medicare supplements underwent standardization. This means that regardless of the insurance provider, a specific plan, such as Plan G, offers identical coverage. This shift from the previously complex and confusing system ensures transparency and prevents any deceptive practices. And the next benefit is a guarantee of benefits. Once you select a Medicare supplement plan, your benefits remain unchanged. As long as you continue paying your monthly premium, your coverage remains intact.


This guarantee allows for lifelong plan renewal and safeguards against unexpected modifications and the final benefit. Separate prescription drug coverage. It’s important to note that if you opt for a Medicare supplement plan, you must obtain a separate prescription drug plan. This ensures comprehensive coverage for both medical and prescription needs. Okay, next, Medicare supplements, eligibility, and enrollments. You must health qualify. You’ll be asked numerous health questions by different companies to understand your health status in the last two to five years. Questions vary slightly, covering conditions like cancer, heart attacks, C O P D, rheumatoid arthritis, stroke, and more. Answering yes to these questions often makes you ineligible for Medicare supplement. Let’s talk about initial enrollment. When enrolling in Medicare Part B, insurance companies must accept you. During this enrollment period, health questions are not allowed. Any plan shown on the chart, which I will share in the transcript, is available for selection.


The importance of an enrollment window missing the initial enrollment window leads to health-related questions. Answering yes to these questions may permanently disqualify one from Medicare supplements. Understanding this before enrolling is crucial. So two popular plan choices are plan G and plan N, which individuals commonly prefer as they provide comprehensive coverage from Medicare gaps. And I want you to note proper understanding of eligibility enrollment windows and plan options is essential. When considering Medicare supplements, I really encourage you to seek guidance to make informed decisions. Okay, option two: Medicare Advantage. Medicare Parts A and B supplement and drug plan into one package. Let’s talk about the benefits of Medicare Advantage. While it may have a low premium or no premium, it’s important to note that you will still need to pay for Medicare Part B enrollment. In Medicare, A and B are necessary to be eligible for Part C.


Unlike Medicare supplements, Medicare Advantage operates within a network of doctors and hospitals. The network size varies, but it typically includes all of your preferred healthcare providers. Medicare Advantage plans often include coverage for prescription drugs. Part D within the health plan premiums can change annually. Unlike Medicare supplements that remain stable and it’s important to be adaptable and open to potential changes each year. Also, plans may differ for individuals living in different areas. So what are some of the extra benefits of Medicare Advantage as of 2023? Dental coverage, which may include routine dental care, cleanings, fillings, and even dentures, vision coverage, eye exams, prescription eyewear glasses, contact lenses, and discounts on vision-related services. Hearing aid coverage, transportation options may include rides to doctor’s appointments, pharmacies, and other healthcare facilities. Meal assistance may include meal cards or reimbursements for specific dietary needs, such as post-surgery recovery.


It’s important to understand that not all Medicare Advantage plans offer the same extra benefits. Availability of benefits can vary by county within your state, so it’s crucial to research plans specific to your location. Extra benefits may change annually, so staying informed about the current offerings is essential. Remember that original Medicare does not include most of these additional benefits, and of course, Her Retirement can assist in researching these available insurance companies and benefits specific to your zip code. So supplement or advantage choosing between Medicare supplement and Medicare Advantage depends on several factors, including budget, health condition, travel frequency, number of doctors, and comfort level. With the change, Medicare supplement is advantageous for individuals with a higher budget offering flexibility in nationwide coverage. Medicare Advantage may be more suitable for those who are healthy and eat and infrequently visit doctors, as well as those with ongoing health conditions that require more comprehensive coverage.


Travelers and individuals with multiple doctors may benefit more from a Medicare supplement plan to ensure broader access to healthcare providers. Personal preferences, family medical history, and anticipated health needs should be considered when making this decision. And you can regularly reassess your health and financial situation to ensure the chosen plan continues to meet your needs. So if you wanna start with one and switch to the other, which plan should you start with? Supplement to Advantage or advantage to supplement. Everyone’s situation is certainly unique, and the best Medicare plan for you may differ from others. Evaluate your health, your budget, your insurance preferences, and your travel frequency. Medical Medicare supplement is available to everyone during the initial enrollment period for Medicare Part B. Regardless of your health insurance, companies must accept you in any state and plan. Starting with a Medicare supplement provides flexibility and the ability to choose any doctor or hospital.


If you can comfortably afford a Medicare supplement plan, it’s recommended that you start with it. Keeping in mind that Medicare supplement premiums typically increase annually by around five to 10% after a few years, the premium may become less affordable, but you can explore other options. Private Medicare Advantage plans can be an alternative with zero or low monthly costs. Medicare Advantage plans offer extra benefits such as gym memberships or grocery carts. You have an annual opportunity to switch to Medicare Advantage during the open enrollment period from October 15th to December 7th. If you initially choose Medicare Advantage, you can switch back to Medicare supplement in the future. Moving between plans based on changing health and financial circumstances is an option. Consider your age, health outlook, and preferences when making these transitions. So little caution. When choosing your plan, it’s vital to assess your healthcare needs, preferences, and budget. When selecting a Medicare plan, relying on someone else’s plan without considering your own unique circumstances may lead to inadequate coverage.


Your health condition. Prescription meds providers should drive your plan selection. Ensure your chosen plan covers your doctors, hospitals, and necessary medications. Medicare plan availability and coverage options vary by zip code. Your location plays a significant role in determining the plans accessible to you. Of course, consulting with a Medicare specialist or insurance professional can help you navigate the huge range of options, and they can assist in assessing your specific needs and finding a plan that best aligns with you. Critical deadlines and penalties, retirees have a three-month window before and after their 61st birthday month to enroll in Medicare without penalty. On the other hand, working individuals with employer coverage are not penalized for keeping their current plan missing. Enrollment deadlines can result in lifelong penalties such as the Part B and Part D penalties. The Part B penalty is 10% of the monthly premium, increasing annually.


While the Part D penalty can also apply, it’s essential to compare the benefits of Medicare to your employer coverage if you’re still working at 65. As Medicare may provide more advantageous options, you need to make an informed decision by evaluating the advantages and potential cost savings of Medicare versus your employer’s plan. You know, we can connect you with these resources to help you analyze these plans and make the best decision. And I also have a more in-depth Medicare class. That’s part of my Her Retirement Roadmap Masterclass. The masterclass includes class workbooks, guides, checklists, decision trees, and other resources. If you wanna learn more about the masterclass, go to her retirement Module number six in the masterclass covers healthcare, Medicare, and long-term care. I will do a future podcast on long-term care and estate planning. So in that masterclass, there are eight modules, and the sixth module covers healthcare, Medicare, and long-term care.


The point of today’s podcast and video was to give you a very high-level overview of the Medicare options that you have. There are also some changes coming to Medicare, which you can learn about in the masterclass. Important changes that you need to be aware of. One of the other things that I wanted to point out today is that Medicare comes out of your social security benefit. One of the issues is as we age, our Medicare costs and medical costs go up. So potentially, like a 65-year-old couple, by reaching 80, most of their social security benefit could be going toward Medicare medical expenses. So it’s really important to understand how your Medicare and medical costs will impact your retirement income. And relying on social security for your income alone is not a good decision. For most people, social security accounts for 30 to 50% of their income.


And you know, you may say, okay, my social security will be my medical expense, right? That income will just cover my medical expenses, and if there’s any leftover, then that’s a bonus. But then you have to have your other income sources, which of course, if you have deferred retirement savings accounts like 401ks and IRAs if you have Roth Accounts Index universal life, you’re going to work. Maybe you get inheritance rental properties. I mean, all of these income sources go into creating your retirement paycheck, and it’s very important to understand how these costs will impact you. The other thing that we didn’t talk about was out-of-pocket costs. So in this session, we talked about Medicare and medical supplement costs. So out-of-pocket costs can add up to a very large number over the course of retirement, and you need to be prepared for those.


And so, in the masterclass, I talk about ways to fund those out-of-pocket costs and to fund things like long-term care because, again, in the Masterclass, you’ll learn that Medicare does not pay for long-term care. That is a completely separate expense that is on you. So I hope you’ve learned a little bit about Medicare, and you are welcome to reach out to me if you need help. You’re 64, and you need to decide soon here. You need to start evaluating your options and trying to decide the best situation for you. What is the best plan for you beyond parts A and part B? Definitely reach out to me at and go to her retirement If you want to access the eight modules in that masterclass, one is on Medicare, healthcare, and long-term care. Here’s to Knowing more, Having more, and Getting Her Done.


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