This week’s questions from Tawnya
Your last two columns have really made me question staying on my Supplement. I’m highly considering a change to an Advantage Plan because I can save over $100 per month in premiums and pick up hearing, dental, vision, and OTC (Over the Counter) benefits my Supplement doesn’t provide. I also pay for my own gym membership. My friends at the YMCA who have Advantage Plans go for free. Can you tell me the pros and cons of moving to an Advantage Plan?
Answer
HMO and PPO Savings
The obvious reason you might want to change to an HMO or PPO is for premium savings, like you mentioned. And with the increase in Part B premiums along with prices for gas, groceries, and utilities going up, there may be seniors on fixed incomes who won’t have any choice but to move to, or choose, an Advantage Plan. We love Supplements. But the best insurance in the world isn’t worth a penny if you can’t pay for it. I tell everyone if you need to put off paying another bill because your Supplement premium is due, it’s time to go on an Advantage Plan.
I understand why people who can afford Supplement premiums might want to change as well. Those who can save $100 or more per month like Tawnya and stay relatively healthy, avoiding chemo or radiation, a lengthy Skilled Nursing stay, injection or infusion therapy such as shots for macular degeneration or Remicade treatments, or a couple other less common services with big co-pays or coinsurance, can save $5,000 or more in premiums over a five-year period.
Ancillary Benefits
In addition, as Tawnya said, Advantage Plans offer some valuable ancillary benefits such as comprehensive dental that covers pretty much every service other than implants, no cost eye exams and between $100 to $400 allowance for eyeglasses every or every other year, as well as what I refer to as “monopoly money” to spend on OTC items out of a catalog. Some plans also offer allocations for hearing aids up to $2,500. A new benefit on a limited number of plans is a co-pay card. The insurance company loads $100 per quarter on a debit card that can be used to pay bills for several services. There’s also plans that supply another $75 a quarter for the purchase of “healthy foods” from Walmart or Giant Eagle. I find it eye popping how much “free stuff” is being given away right now. Never in the history of Advantage Plans has it been so generous.
Those who get their regular teeth cleaning and X-rays, take advantage of the free gym membership, use the maximum amount of OTC, eyeglasses, as well as co-pay and healthy foods debit card benefits can get as much as $1,800 a year in value. And I’m not even counting hearing aid benefits or those paid for fillings, crowns, root canals, or dentures in that figure! We’re talking about $14,000 in potential premium savings and “free stuff” combined.
It’s no mystery why Advantage Plans now count for 50% of all Medicare enrollments and will soon surpass Supplements as the most commonly chosen Medicare option.
Not All Plans are Equal
But people must be careful. Not all HMO’s or Advantage Plans are created equal. As I’ve written about a lot lately, two of the most popular plans in Western PA only provide the gym membership, dental benefits for only cleanings and X-Rays, $100 for a pair of glasses every two years, and zero OTC or debit card benefits. These folks who use the gym are getting less than $600 a year in value. Those who don’t, just $200. They’re also likely paying $400 or more per year in premiums and therefore saving little or no money by being on an Advantage Plan vs a Supplement. It’s my professional opinion that anyone on the plans I’m referring to should either have a Supplement or one of the handful of HMO’s and PPO’s that cost $38 per month or less that we recommend. If you’re paying more or not getting everything I listed with your current plan, you should make an appointment with us to compare it to our favorites. You can still change to any plan until the end of March, and to those with a “5-Star” rating year-round.
Now for the risks or concerns of moving from a Supplement. I have two that I make certain people understand. One is the very real possibility that returning to a Supplement won’t be possible ever again. Supplements are underwritten, meaning companies can decide they don’t want people who have pre-existing conditions for diagnoses as common as A-Fib and insulin dependent diabetes. Others that can result in a guaranteed denial are heart disease, certain cancers, COPD, and more.
Maybe the biggest worry is the difference in how claims are approved (or denied). Supplement companies have no say in what’s covered. It’s up to the treating physician(s) to decide what’s medically necessary. There are no pre-approvals required. If your doctor wants you to have an MRI or surgery immediately, or he or she wants their patient to stay in the hospital an extra day or two, it happens without interference from an insurance company. That’s not the case with Advantage Plans. Almost everyone I meet who is 50 or older has dealt with or knows someone who had a claim denied for an MRI or CT scan or was told they needed to go to physical therapy prior to getting one or before a surgery could be performed. The most common insurance company inconvenience in my experience is being told that no more days in a Skilled Nursing Facility will be paid for. When that decision is made, the availability of a spouse, child, friend or family member who can help care for the person being discharged isn’t taken into consideration.
Thank you!
If you have any questions or concerns regarding this column topic, or would like to make an appointment for a no-cost consultation, please feel free to give us a call – we would be happy to help. I’d like to remind everyone that I do a live call-in talk show called Medicare A to Z every 1st and 3rd Monday of the month on WMBS Uniontown, 590AM and 101.1FM, from 1 to 3 PM. You can listen in on their website, wmbs590.com.
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