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If you saw a Benjamin Franklin $100 bill laying on the sidewalk, would you pick it up? If someone offered to pay your groceries for 2 months, would you take them up on that? If you had to fill out a coupon to receive six months of free gas for your car, would you send it in? Most people would, but most people never price compare their Medicare Supplement to save $100, $500, $1000 a year. One of the most common excuses and common Medicare myths is that it is not Annual Election Period (AEP), which is Oct 15th–Dec 7th, so ‘I can’t do anything.’
Common Medicare Myths
A common Medicare Myth I hear everyday is that you can’t change your Supplement except during Annual Election. That is true about Medicare Part D plans. Unless you have a special election, you cannot change your Medicare prescription drug plan until Oct 15th. The same applies to Medicare Part C/Medicare Advantage. You cannot change from one company or plan to another except from Oct 15–Dec 7th. Those are the CMS (Center for Medicare & Medicaid Services) rule.
Change Medicare Supplement Any Time
That, however, is not the case for Medicare Supplements. You can change your supplement every month if you wish. A Medicare Supplement is a contract with a private insurance company that fills in the gaps in your Medicare coverage. It pays the Part A hospital deductible. It pays some or all of the 20% co-insurance under Part B. All you have to do to change supplements is answer some health questions and fill out the forms. That’s it.
Compare Pricing
Compare prices. It takes less than 5 minutes. I do quotes for people all day. You can know in seconds whether you are overpaying for the exact same coverage, and you can do something about it. You can change right now. You can save $300, $500, $1000 a year right now. It is especially appropriate to check after you receive a rate increase from your insurance company. You aren’t stuck. Pick up the phone and find out your options.
This is still the land of the free, and in the Medicare Supplement world you are free to compare and change. Don’t be fooled by one of the common Medicare myths. You can make changes to your supplement at any time. Compare prices. If you would stop, bend over, and pick of a Benjamin Franklin laying on the sidewalk. You can take the time to check the supplement rates and even fill out an application 402-614-3389.
I learned to sing the alphabet before I learned to say it, and from that humble beginning, language opened up to me.
You can’t understand language without first understanding its alphabet. Medicare has a language, and Medicare has an alphabet. It begins with A, B, & D. They are the three essential components of Medicare.
A is for Medicare Part A. A covers the hospital 100% for 60 days but only after you pay a $1,260 deductible out of your pocket. Ouch! Part A is free because you paid for it during your working years. Eligibility for A is 3 months before your 65th birthday, the month of your birthday, & three months after. If you don’t enroll then, there will be a penalty.
B is for Medicare Part B. B covers doctor visits and outpatient procedures, such as, blood work, x-rays, emergency room, ambulatory surgeries, walkers, wheel chairs, oxygen tanks, etc. Part B does cost something. Currently $104.90 per month. Medicare Part B pays 80% of the costs. Your portion is 20%. Important fact about your 20% co-insurance is that there is no cap. As long as the bills roll in, your money rolls out. Bigger Ouch! The penalty for late enrollment for Part B is 10% for every 12 month period.
The final letter is not C. It’s D—D as in drugs. Medicare Part D was started in 2006 after people complained about the crushing cost of medications. Prescription drug plans are administered by private insurance companies approved by Medicare. Prescription Drug Plans (PDP) can range in cost from $20–$50 per month with deductibles and co-pays. There is a penalty for not enrolling in a Part D plan when you are eligible. It accrues each month you are not enrolled and is permanently added to your Medicare premium when you do enroll.
Medical expense can be astronomical. If the correct insurance is not in place with sufficient coverage, costs may surprise and overwhelm you. Not following the eligibility requirements could result in surprise penalties and permanent costs from Medicare. Call 402-614-3389 or email us at [email protected] for a free consultation to make sure all your letters are in place.
Markets are constantly changing. The Wednesday and Sunday additions of the Omaha World Herald are full of ads and fliers. Stores publicize sales, put up posters with markdowns, advertise deals, and promote special events. Prices and products are constantly changing. The market place does not stand still.
The insurance and Medicare market is no different. Aetna announced a 37 billion dollar bid with a capital B for Humana this week. Anthem Blue Cross is in talks about acquiring Cigna. Centene Corp agreed to buy Health Net Inc for $6.3 billion. The insurance landscape is changing.
These are big players, so when they move, the Medicare market will be affected. Some will argue that consolidation will reduce costs. Others will say that bigger and fewer insurance companies means monopolistic pricing. How it plays out is yet to be seen. Analysis will fill up hours of television and radio time with speculation about the Medicare market. The reality is insurance products, including Medicare supplements, will change. The changes will come primarily in the form of prices.
An endless list of variables go into Medicare supplement premiums. Creating and administering a Medicare Supplement product costs something. Medical claims come out of the premiums collected, so the premium needs to be high enough. In the end, the company must generate a profit for the shareholders. Otherwise, there is no point and the company’s assets will be sold off.
To generate those profits, the company needs to acquire clients. That is done in a number of ways. Slick advertising and marketing campaigns get prospects in the doors. Have you ever received any mail from an insurance company? During open enrollment (Oct 15th—Dec 7th), the Medicare commercials are like political adds at election time. They are endless. You can’t wait for them to stop.
The other way that insurance companies get prospects in the door is price. But how low can a company price the product? In other words, how lean can the company run its operation and still make a reasonable profit? If they guess wrong on pricing, it could be devastating for everyone involved—clients, employees, and shareholders.
If they lower the price too much and cannot meet claims and expenses, the company will be forced to raise premiums and drive away healthy clients. If they are too high, they will not have enough clients to create an adequate pool to assume the risk. Claims could further drive up costs and cause the company to raise premiums even higher.
So, like oranges, asparagus, and lettuce, the price of supplements are in a state of constant flux. Some of the factors are age. Price goes up with age. Rate increases are announced by the company because medical costs go up. And sometimes, there is even an occasional decrease.
Who is your shopper? Who will let you know what is happening in the Medicare market place? Who can find the lowest price supplement for you? I am Chris Grimmond the found of Omaha Insurance Solutions. I have worked for and with insurance companies for 13 years. I understand the Medicare market and how it works. We will shop your Medicare supplement and make sure you always have the best value for your dollar 402-614-3389
A popular show on AMC is Turn. It is about General Washington’s spies during the Revolutionary War. You find out quickly that intelligence is critical for an army to be successful. It was intelligence that moved Washington to cross the Delaware River Christmas night to catch the Hessians sleeping at Trenton. That victory was one of the turning points in the war.
Do you have the best Intel on your Medicare supplement? Part-time supplement sales people know very little about Medicare, Medicare products, and the insurance industry. How could they? They have little training. They do it when they are not doing their day job or taking care of family concerns. The insurance companies and agencies that recruit them do not invest a great deal of money or energy in them because they know most of them will not be there next year. Consequently, their knowledge is very shallow.
Why’s that important? Because they are making recommendations for you about your Medicare supplement. They do not have the training, tools, or experience to pull back the skin on these insurance products to see all the moving parts.
For example, what was the annual rate of increase for a Medicare supplement for the past five years? If client premiums increased 2% or 12%, that is a big difference and big deal. Yes, prices go up, but will the insurance company give you a great price today and turn around 3 years later to jack them up? As we age, the chance of health issues arising is much higher. It will be more difficult to change companies when we get older. You don’t want to be stuck with a company that is going to drive the prices through the roof as you age.
What is the age increase? Each year most supplements will go up as you age because the costs go up as we age. Is the age increase 2% per year 4%, 7%. That’s important. Does the company have a real low price when you turn 65 or 66, but then goes through the roof by the time you are 80?
An experienced insurance profession will be able to show you the numbers, interpret the numbers, and explain the numbers. The cheapest price is not always the cheapest price. There are other variables. That is Medicare Intelligence.
Intel is important for armies to win battles. It is important for people selecting Medicare Supplements so that there are no costly ambushes down the road. Medicare Intelligence shows the hidden flaws.
