Understanding the Many Choices in Healthcare
August 9, 2023
Medicare & Social Security: Debunking Myths and Understanding Changes
The ‘Money Back’ Myth Exposed
You’ve likely seen those television ads, the ones with aging sports figures hinting that Medicare beneficiaries can get “money back in your Social Security check every single month!” But these promises, when examined closely, often require more context.
(This article appeared in the Winter 2024 Issue of GOAL Magazine. You can visit the entire issue online at: https://issuu.com/go2goal/docs/goal_magazine_winter_2024_web)
Is there really a benefit that adds money to your Social Security Check? Well, what those ubiquitous ads are really trying to do is sell you a Medicare Advantage plan.
Medicare Advantage plans (Medicare Part C) are programs managed by private insurers but regulated by Medicare. Many Advantage plans provide extra benefits not covered by Original Medicare, such as dental, vision, and hearing.
Part C plans are popular and beneficial; however, the way these plans are paid for creates room for confusion that some advertisers may take advantage of.
So, how can choosing a Medicare Advantage plan put money back in your Social Security check? That’s where an understanding of how your Social Security check is calculated comes in. You see, every month an amount is deducted from your Social Security check to pay for Original Medicare. Even if you have a Medicare Advantage plan (one of the Part C private ones), money is still withdrawn from your check and given to the insurance company handling your plan (unless you have state assistance helping pay for your Medicare premium).
Those companies in the “money back” ads are offering a Part C plan with a “premium reduction benefit.” They take a lesser amount than would be paid to Original Medicare, and therefore your Social Security Check looks a little larger.
What’s the downside? These inexpensive Part C plans may have a much smaller network, higher prices for procedures, and in the end cost you more than you are getting back in your Social Security check. That’s why it’s important to understand the details behind the promotion.
Professional Medicare Advice is Available
While TV claims might technically be true, they don’t paint the full picture. It’s essential for beneficiaries to dig deeper, seek professional advice, and weigh the short-term benefits against potential long-term costs. In the world of Medicare, knowledge and professional guidance are the keys to making informed choices.
You should also be cautious about taking ‘street advice.’ Depending on neighbors or family for Medicare information can be unreliable, as their experience is limited to what may have been appropriate in their unique circumstance. Following the advice of personal stories may not reflect the wide range of options available and could result in misinformed choices. For example, a friend may tell you that they do not have a premium for their Medicare Advantage plan, but they actually do and it is deducted from their monthly Social Security check with the Original Medicare premium.
Professional agents are constantly updating their training and knowledge of new practices and regulations. They follow stringent rules, such as mandatory call recording, disclaimers, and the newest regulation – the need for agents to secure appointment approvals 48 hours in advance. These measures are in place to assure that you are being taken care of by a well-trained, regulated professional, rather than a TV pitchman.
Unfortunately, Medicare is complex, with nuances that require careful consideration. While the allure of TV ads might be hard to resist, it’s important to dive beneath the surface and seek expert advice, weighing immediate perks against potential future costs. In this ever-evolving world, staying informed and leveraging professional guidance can make all the difference.
The Complex World of Medicare: Looking Ahead
Navigating Medicare can be like trying to find your way through a maze. Each year brings modifications, with more changes expected in 2023 and 2024 than can be discussed in a single piece. However, let’s touch upon some important updates:
Medicare Deductibles
On October 12, 2023, the Centers for Medicare & Medicaid Services (CMS) announced the 2024 details for Medicare Part A, Part B, and Part D programs. To enhance healthcare access and reduce costs, CMS streamlined enrollment in the Medicare Savings Programs (MSPs), potentially making coverage more affordable for approximately 860,000 individuals.
Additionally, the Inflation Reduction Act expanded the number of people eligible for the Part D low-income subsidy (LIS) which assists in covering the Part D premium and reducing prescription drug costs.
Medicare Part B, which encompasses services like physicians' visits and outpatient hospital care, will see its standard monthly premium rise to $174.70 in 2024, up from $164.90 in 2023. The annual deductible will also increase to $240, a $14 hike from the previous year's $226. These adjustments are primarily attributed to anticipated healthcare spending increases and adjustments related to the 340B-acquired drug payment policy.
Medicare Advantage Changes
The average monthly premium for Medicare Advantage plans is set to see a slight increase of $0.64, moving from $17.86 in 2023 to $18.50 in 2024.
About 73% of beneficiaries will experience no premium increase if they stay with their current plan. Additionally, the agency highlighted that there will be more plan options and an expansion in supplemental benefits in the coming year. Medicare Advantage enrollment is projected to grow from 31.6 million in 2023 to 33.8 million in 2024, raising the percentage of Medicare beneficiaries in these plans from 48% to 50%.
Medicare Part D shifts 2024:
In 2024, significant changes are expected for Medicare Part D benefits. For Part D enrollees reaching the catastrophic phase, the previously required 5% coinsurance will be abolished. To qualify for this catastrophic coverage, Part D enrollees without low-income subsidies (LIS) must have drug expenditures reaching $8,000, which combines out-of-pocket expenses and manufacturer price discounts from the coverage gap phase.
This change is expected to provide significant savings for those on high-cost drugs.
Furthermore, Part D plans will shoulder a larger portion of drug costs in the catastrophic phase, covering 20% in 2024, up from 15% in the previous years. Another significant milestone is the extended drug coverage for kidney transplant recipients. They can now utilize Part B immunosuppressive drug coverage for life, as opposed to the earlier 36-month window.
Making Medicare Easy
As an independent insurance agent with Insurance Services, LLC, Allison Clayton offers unbiased advice. She has access to a range of plans and ensures her recommendations, whether for Medigap, Medicare Advantage, or Prescription drug plans, are objective.
Licensed with multiple insurance carriers, Allison can quickly compare rates, provide insights on rate histories, and share her experiences with different carriers' customer service and online systems.
Allison's main goal is to simplify Medicare. In her educational sessions, she explains how Original Medicare works and helps those nearing retirement. Once they're enrolled in Original Medicare, Allison further assists by evaluating individual needs to recommend the best plan.
“We are licensed with various insurance carriers, so their rates are at our fingertips to compare instantly, and we can access the different insurance carrier rate history over the years, have familiarity with their customer service, and website portals.”
“After we develop a needs analysis that reviews your medication, doctors, and the benefits that are important to you, then we work to narrow down some plans that are right for you.”
Allison Clayton is available for in-person, by phone, and virtual appointments. If you would simply like a quick phone review, you can call anytime at 724-879-5030.
Visit Allison’s website at https://www.insuranceallison.com/. She can answer all your healthcare questions and keep you on the right track!
There is also a website scheduling option at her website: https://www.insuranceallison.com/request-an-appointment/
