We explain, in understandable terms, how insurance works.
We explain, in understandable terms, how insurance works.
There are three main Medicare product groupings: Supplements (aka Medigap), Medicare Advantage Plans (aka PART C) and Drug Plans (aka PART D). All are designed to enhance the Federal insurance program (aka Traditional or Original Medicare) which consists of PART A:Hospital, PART B:Medical, PART C:Medicare Advantage and PART D:Prescription Drugs. Within the groupings of products, there are several types and within those types, several variations. All designed to allow beneficiaries to elect the products to best serve in their situation.
We have offerings in all product groups.
Additional Benefits which are benefits that Medicare allows Plans to offer but are not benefits required by Medicare are known by a variety of terms: Supplemental, Extra, Ancillary, pot sweeteners, incentives, goodies, bennies, or SSBCI).
Advantage Plans offer an array. All are designed to enhance the market attractiveness of the product.
Depending on the plan and your level of eligibility, you can enjoy an Over-The-Counter credit account (where you can buy food/vitamins etc or pay utility bills), transportation to appointments, meals after hospitalization, fitness club memberships, dental, vision, hearing and so on.
The latest 'bennie' is Premium Reduction, (aka The Giveback, aka Rebate). Here's how the pitch works...'Buy our plan and we, the insurance company, will provide a cash rebate in some form'.
However. Not all is as it seems. Depending on the plan, the benefits have to be funded. Somehow. So. An attractive benefit here, usually means making you pay (or risk paying) more there. Whether or not that attractive benefit actually improves your cash flow in the next year depends on how the upcoming year works out.
Think carefully about those attractive goodies. Be certain you understand any tradeoffs before enrolling. Usually, an ethical agent will not recommend you increase your risk unecessarily.
Supplement plans, aka Medigap (as titled by Medicare) are insurance policies which are paid monthly in advance to have your share of charges paid by your insurance company. They pay your share of Original Medicare benefits under PART A and PART B. There are 10 plan variations so you can adjust to your circumstances. Not all companies offer all the variations. Coverages vary from covering (your share of) all of Medicare's medical benefits to partial copays and specific benefits. Premiums vary by plans, companies, age and geographic location. Usually, more premium, more coverage. Premiums are determined by the company which can increase monthly or annually or stay the same.
The Medicare statute has a provision to allow insurance companies to offer approved plans that bundle the provisions of the statute, which is: PART A:Hospital and PART B:Medical and, most of the time, PART D:Prescription Drugs, all into one plan (aka PART C:Medicare Advantage). Additional benefits (those not covered by Medicare such as dental, vision, etc) are all rolled into one package.
While the 'perks' are attractive, remember, the reason you purchase the plan is your medical and drug coverage..
Medicare approves, oversees and disciplines companies that offer these plans. Not all plan designs are available everywhere or to everyone.
Some Plans are designed where one must visit only network providers. Some Plans are designed where one can see either network or non-network providers. Plans are designed for regions and groups of counties within states. Plans are designed for different income and health circumstances. Plans are designed for Medicare only recipients. Plans are designed for those on Medicare and Medicaid. Lots of variations.
The way Advantage Plans work is Medicare pays a stipend to the plan in return for the plan becoming the administrator of the coverage and the benefits. The members may pay a monthly premium, usually low to zero. Some plans even offer to pay a share of your PART B premium by reimbursing your Social Security.
PART C plans require you to agree to pay a share of costs when you use the benefits, however, some plans pay all of your costs If you qualify (usually Medicaid). While all benefits offered by Medicare must be offered by each plan, the cost share may vary between plans and between companies.
All plans feature, by law, an annual maximum out-of-pocket (MOOP) limit which is a trigger amount. where, should the sum of the medical copays exceed the MOOP amount, the plan converts to 100% coverage for the rest of the policy year. Note: only a small percentage of beneficiaries ever reach the trigger within a policy year.
As one of the Medicare Advantage variations, the Medicare statute authorizes companies to offer plans that pay upfront funds annually to beneficiaries to use as they see fit. The cash payment belongs to the beneficiary who is free to use the funds as they wish; note there are tax implications if used for non-medical expenses. The plan has a trigger (MOOP) where coverage converts to 100%. There are specific rules.
At this time, we do not have an offering for this type of plan.
The Medicare Statute authorizes private insurance companies to offer PART D:Medicare Rx Plans (aka PDP) which cover Medicare approved prescription drugs under statutory provisions mandated by Congress. Medicare uses a Master Formulary (all the drugs listing) from which each plan can select all, or usually, some drugs to cover in their plans. All PART D plans follow statutory mandates: at least 2 drugs from each category. An annual deductible is allowed which can be waived or partially applied. Defined coverage stages are mandated where each is governed by a defined amount threshold and defined co-pays. Here too, Medicare approves, oversees and disciplines all plans.