If your parents are turning 65 or already on Medicare, you may be assisting them with their health insurance needs. The task of helping parents with Medicare insurance can be overwhelming. The good news is that there is plenty of Medicare information available. The bad news is there is a whole lot of Medicare information available. Regardless, helping your parents with Medicare insurance is important. So, let’s get started.
Medicare has many moving parts. Once you understand the basics, all the parts start working together. If you are here, then you are committed to helping your parents with Medicare insurance. So, allow me to help you.
What is Medicare?
Medicare is a health insurance program for the following people:
- Seniors age 65 or older
- Those under age 65 with certain disabilities
- People of all ages diagnosed with End-Stage Renal Disease
There are two parts to Medicare.
- Part A
- Part B
Medicare Part A
Part A is hospital insurance and helps pay for:
- Inpatient hospital care
- Critical access hospitals
- Skilled nursing facilities (not custodial or long-term care)
- Hospice care
- Some home health care
Most people receive Part A automatically at the age of 65. Part A is usually free because the recipient or spouse paid their Medicare taxes while working. If your parent does not automatically receive Part A at no cost, he or she may be able to buy it.
Medicare Part B
Medicare Part B is medical insurance and helps pay for:
- Doctors’ services
- Outpatient hospital care
- Medical supplies covered by Medicare
- Other medical services not covered by Part A
Most Medicare recipients pay a Part B monthly premium of $121.80 (amount in 2016). If their yearly income is above $85,000 (single) or $170,000 (married couple), then the Medicare Part B premium could be higher.
Enrolling in Part B is by choice. Your parent can sign up for Medicare Part B at any time during a 7 month period beginning 3 months before turning 65. The easiest way to enroll in Part B is to call or visit a Social Security office.
If your parent signs up for Part B, the premium is usually taken out of their monthly Social Security, Railroad Retirement, or Civil Service Retirement payment.
Below are some Medicare enrollment guidelines you may find helpful.
Initial Enrollment Period
The initial enrollment period is the period of time your parent can sign up for Part A and/or Part B. This is a 7 month window that begins 3 months before the month he or she turns 65. It includes the birth month and ends 3 months after the month your parent turns 65.
Those who sign up during the first 3 months of the initial enrollment period will get an effective date of the first day of their birthday month. For example: If the birthday month is March and your parent signs up for Part B in January, the Part B effective date is March 1.
General Enrollment Period
General Enrollment Period is available from January 1 – March 31 each year. It is set up for those you didn’t sign up for Part B when first eligible. Coverage begins July 1 of that year. It’s possible that your parent may have to pay a higher Part B premium for late enrollment.
Special Enrollment Period
Special Enrollment Period is available for anyone who didn’t sign up for Part B when first eligible. This happens when your parent is still covered under a group health plan based on current employment (their own or their spouse’s). The Special Enrollment Period can be used anytime your parent is still covered by the group health plan or during an 8 month period after the employment ends or the coverage ends, whichever occurs first.
If you’ve made it this far, congratulations! I know it’s a lot of information. Helping your parents with Medicare insurance is no easy task. I’m sure they’ll appreciate your time and effort.
More Information to Help You Assist Your Parents with Medicare Insurance
If your parents have ONLY Original Medicare Part A and Part B insurance, they will be in a vulnerable position. Why? Medicare Part A and Part B cover about 80% of their Medicare approved health care costs.
Here are some of the costs your parents are responsible for:
- Part A hospital deductible
- Part B medical deductible
- Excess charges
I’ve spoken to some people who are comfortable with ONLY Medicare Part A and Part B. They are healthy and the doctor visit bills are not a financial burden.
I’ll be frank. I would never be comfortable if my parents had Medicare Part A and Part B as their ONLY health care coverage.
Here’s one reason why…
I have a client who was recently diagnosed with stage 4 lung cancer.
Henry is at the end of his eight month journey of radiation treatments. Prior to his diagnosis, Henry was a picture of good health. He never smoked and only used medications for cholesterol and high blood pressure. So it was a shock to learn of his diagnosis.
With this major illness, the limited coverage provided by Medicare would leave Henry with large medical bills. Here’s what he’d be responsible for:
- Part A hospital deductible
- Part B medical deductible
- Excess charges
Thankfully, Henry has Medigap insurance. He pays a monthly premium. In turn, all his Medicare approved charges are covered and he does not have to worry about the deductibles, co-insurance, co-pays or excess charges.
When I spoke to Henry’s wife, she said they are so thankful to have Medigap insurance. It’s given them some peace of mind during this difficult time.
How does Medigap insurance work?
It’s a simple process. So simple, you’ll be wishing you could have a Medigap plan too.
Medigap which is also called Medicare Supplement insurance helps fill in the gaps between what Medicare pays and what your parent must pay.
With Medicare and Medigap, your parent can visit any doctor who accepts Medicare (no networks).
The doctor sends the claim to Medicare. Medicare pays its portion of approved costs (generally 80%). Medicare then sends the claim to the Medigap insurance company. The Medigap plan pays it’s portion of the remaining 20% of Medicare approved charges.
If your parent chooses Medigap Plan F, then all their deductibles, co-pays and co-insurance will be paid by the insurance company.
In total, there are 10 standardized Medigap plans, labeled A through N. All insurance companies selling Medigap Plans offer the same exact benefits with each plan. The only difference is price. The most popular plans are Medigap Plan F, G and N.
How can your parent get a Medigap plan?
I’m sure your parents have received multiple mailings, phone calls or viewed TV commercials from some of the larger insurance companies. But they aren’t the only carriers offering Medigap plans. It’s usually the insurance companies you’ve never heard of that have the best prices.
Medigap insurance is available to your parents who are turning 65, but also to those who are:
- Over 65 and losing employer coverage
- Over 65 and only have only original Medicare
- Over 65 and want to reduce their current Medigap premium
- Over 65 and looking at other Medicare insurance options
Medigap plan benefits are standardized by CMS. The benefits with ABC insurance company are the SAME benefits with XYZ insurance company. The only difference is price. Encourage your parents to spend wisely on Medigap insurance.
Use CAUTION if your parent decides to…
- Call the insurance carrier directly
- Search on the internet
- Take unsolicited phone calls
- Invite an agent into their home
Calling the insurer directly = A big gamble
While this may seem like the easiest way to buy a Medigap plan, it can also be frustrating. Remember, your parent is talking directly to the insurance carrier.
The insurance company sells only their Medigap policies. The insurance carrier will not provide comparisons from other companies.
The company may also try to sell your parents additional insurance products. It can be very overwhelming.
Searching on the internet
I’m sure that sounds odd for me to say since you found me on the internet.
If your parent is searching for quotes, they will have no problems getting this information from some of the major companies. Most of the time their prices are very high.
The majority of insurance companies do not publish their premium information on the internet. They rely on independent insurance agents to share their Medigap rates with seniors.
Independent agents, like myself, are usually connected with multiple insurance companies. This allows us to shop the Medicare market for your parents.
Taking unsolicited phone calls
It goes without saying that there are dishonest people who want to take advantage of our parents. There are also plenty of honest people. It can be hard to determine who’s trustworthy. While it may work out most of the time, it only takes one rotten apple to create a bad situation.
If your parent is a trusting individual, tell them to ALWAYS get the agent’s personal information. Then contact the state’s department of insurance to check their credentials.
Inviting an agent into their home
I’m not comfortable with my mom inviting a stranger into her home. If your parent insists on a home visit, beware that these agents usually work for one insurance company. This means they can only offer one Medigap product.
Sometimes the agent might be new and will have their manager with them. Some duos will play the good cop and bad cop routine. They’ll do whatever it takes to get your parent to buy a policy. They are there to sell and it’s hard to get them to leave.
Something to think about
If your parent is not in their one time Medigap Open Enrollment Period or another Guaranteed Issue Period, he or she will have to medically qualify for a Medigap plan.
This means they will answer health questions on the insurance application. A health exam is not required. Insurance companies will usually do a prescription drug review as part of the underwriting process.
While helping your parents with their Medicare coverage, don’t forget about their prescription drugs. Original Medicare and Medigap do not provide coverage for prescription drugs.
Even if your parent takes one or two drugs, he or she should consider purchasing a Medicare approved plan to avoid a Part D penalty.
Medicare.gov provides a database of Part D plans. Simply enter location, drug, and pharmacy information to receive a personalized comparison report.
Whether your parents are turning 65 or seasoned Medicare recipients, helping parents with Medicare insurance is important.
Original Medicare pays a portion of their health care costs. Adding Medigap insurance will provide additional health coverage. It can be purchased from private insurance companies in a variety of ways.
When your parents work with REMEDIGAP, they will receive personal service. We’re dedicated to helping throughout the entire process. Beginning with education, we are here to put all the Medicare pieces of the puzzle together. We take the time to answer questions and never rush anyone to make a decision. When your parents are ready, we’ll guide them through the application process. We are always just a phone call or email away – making it easy to reach us when questions come up.
So what are you waiting for? Give us a call at 888-411-1329 or simply complete our Medigap quote form to find what you need to know about your parents Medicare.
Joann Quinn is the Chief Compliance Officer and Cofounder of REMEDIGAP. She is a licensed Medicare agent in 47 states. Her main role is to provide essential resources and tools to educate eligible individuals on Medicare. Joann provides helpful Medicare education to thousands of viewers with our popular REMEDIGAP YouTube channel. With expertise in Medicare Supplement, Medicare Advantage, and Medicare Part D, Joann is a highly knowledgeable and sought after Medicare insurance professional.