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Avoid the Top 5 Mistakes People Make on Medicare Medicare Workshop

Presented by:

www.senior-advisors.com info@senior-advisors.com

- 3Q 2019-

Jus$nLubenowMedicareSpecialist

MedicareAdvisoryBoardforNa9onalAssocia9onofHealthUnderwriters

908.481.565115AldenStreet,Suite8Cranford,NJ07016

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Parts of Medicare

Part A: Hospital

Insurance

Part B: Medical

Insurance

Part C: Medicare

Advantage

Part D: Prescription

Drug Coverage

•  Inpatient care in hospitals

•  Skilled nursing facility, hospice, and home health care

Usually, no premiums

•  Doctors, hospital outpatient care, durable medical equipment and home health care

•  Preventative services

Usually, $135.50/mo.* * Income adjusted

•  Another way to get benefits covered under Part A & B

•  Most offer prescription drug coverage (part D)

•  Run by private insurance companies

Varies by plan

•  Helps cover prescription costs

•  Run by private insurance companies

Usually, plan premium* * Income adjusted

prem

ium

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Medicare Part B: Monthly Premiums

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2019 INCOME TIERS1 & PREMIUMS

Tier File Ind. Tax Return File Joint Tax Return Prem. in 2019

1 <=$85k <=$170k $135.50

2 $85,001-$107,000 $170,001-$214,000 $189.60

3 $107,001-$133,500 $214,001-$267,000 $270.90

4 $133,501-$160,000 $267,001-$320,000 $352.20

5 >$160,001-$500,000 $320,001-$750,000 $433.40

6 >$500,000 >$750,000 $460.50

1 Income is based on prior full year tax return (e.g. 2016 MAGI for 2018 premiums; 2017 MAGI for 2019 premiums)

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Medicare Part D: Monthly Premiums

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2019 INCOME TIERS1 & PREMIUMS

Tier File Ind. Tax Return File Joint Tax Return Prem. in 2019

1 <=$85k <=$170k Your plan premium

2 $85,001-$107,000 $170,001-$214,000 $12.40 + your plan premium

3 $107,001-$133,500 $214,001-$267,000 $31.90 + your plan premium

4 $133,501-$160,000 $267,001-$320,000 $51.40 + your plan premium

5 >$160,001-$500,000 $320,001-$750,000 $70.90 + your plan premium

6 >$500,000 >$750,000 $77.40 + your plan premium

1 Income is based on prior full year tax return (e.g. 2016 MAGI for 2018 premiums; 2017 MAGI for 2019 premiums)

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Medicare B & IRMAA* TOTAL Monthly Premiums

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2019 INCOME TIERS1 & PREMIUMS

Tier File Ind. Tax Return File Joint Tax Return Prem. in 2019

1 <=$85k <=$170k $135.50

2 $85,001-$107,000 $170,001-$214,000 $202.00

3 $107,001-$133,500 $214,001-$267,000 $302.80

4 $133,501-$160,000 $267,001-$320,000 $403.60

5 >$160,001-$500,000 $320,001-$750,000 $504.30

6 >$500,000 >$750,000 $537.90

* Income Related Monthly Adjustment Amounts

1 Income is based on prior full year tax return (e.g. 2016 MAGI for 2018 premiums; 2017 MAGI for 2019 premiums)

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Modified Adjusted Gross Income (MAGI) You’ll need to start with your AGI, the number at the bottom right of your page 1 tax return, 2 years prior, to figure out your Part B premiums. MAGI calculation To calculate your modified adjusted gross income, take your AGI and add back certain deductions. Many of these deductions are rare, so it's possible your AGI and MAGI can be identical. According to the IRS, your MAGI is your AGI with the addition of the following deductions, if applicable:

–  Student loan interest –  One-half of self-employment tax –  Qualified tuition expenses –  Tuition and fees deduction –  Passive loss or passive income –  IRA contributions, taxable social security payments –  The exclusion for income from U.S. savings bonds –  The exclusion under 137 for adoption expenses –  Rental losses –  Any overall loss from a publicly traded partnership

•  Your MAGI can never be lower than your Adjusted Gross Income.

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Initial Enrollment Period

•  7-month Initial Enrollment Period (IEP) – Eligible 1st of the month turn 65* – Critical to enroll during the 7-month IEP – Can enroll later with penalties (10% per year)

7 * If your birthday is 1st of the month, you are eligible the previous month

June 1 Enrollment Window

Opens

Sept 1 Eligibility Date

Sept 10 DOB

Dec 31 Enrollment Window

Closes

IEP

Exam

ple

1

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Who Pays First??? •  There are several situations where knowing who pays first is extremely

important, as it may cause employees claims to not be paid or for them to face penalties at a later date.

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If the member is… And… This is who pays first Over age 65, on group plan/spouse’s group plan

Employer has less than 20 employees

Medicare

Over age 65, on group plan/spouse’s group plan

Employer has more than 20 employees

Group Health Plan

Disabled & covered by group plan/spouse’s group plan

Employer has less than 100 employees

Medicare

Disabled & covered by group plan/spouse’s group plan

Employer has more than 100 employees

Group Health Plan

On an Employer Retirement plan

Is entitled to Medicare Medicare

Covered by COBRA* Is entitled to Medicare Medicare

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Part B Enrollment Scenarios

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•  Turning 65 (already enrolled in SS*) – Auto-enrolled in A & B

•  Turning 65 (not enrolled in SS*) – Enroll online at

https://secure.ssa.gov/iClaim/rib

•  Enrolling after age 65 (see next slide)

*SocialSecurity

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Enrolling After Age 65

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Two forms needed to drop at Social Security

EnrollinPartBFormhGps://www.cms.gov/Medicare/CMS-Forms/

CMS-Forms/Downloads/CMS40B-E.pdf

ProofofCoverageForm

hGps://www.cms.gov/Medicare/CMS-Forms/CMS-Forms/Downloads/CMS-

L564E.pdf

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Medicare Choices at a glance

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START

STEP 1: Decide how you want to get your coverage.

ORIGINAL MEDICARE MEDICARE ADVANTAGE

Part A Hospital

Insurance

Part B Medical

Insurance

Part D Prescription

Drug Coverage

Medicare Supplement Insurance

(Medigap) policy

STEP 2: Decide if you need to add drug coverage.

STEP 3: Decide if you need to add supplemental coverage.

END

Part C Combines Part A, Part B,

and usually Part D

Part C (like an HMO or PPO)

END

If you join a Medicare Advantage Plan, you can’t use and can’t be sold a Medicare Supplement Insurance (Medigap) policy.

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Original Medicare compared to Advantage

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Characteristic

Original Medicare +

Medicare Supplement

Medicare Advantage

(Part C)

Relationship to Medicare Parts A & B

Supplements Replaces

Private Network Required No Most Plans

Referrals Required No Some plans

Part D Included No Most plans

Monthly Premiums Vary, but generally higher Vary, but generally lower

Annual Out-of-Pocket Costs Minimal Up to $6,700

Guaranteed Renewable for Life Yes No

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Illustrative Diagram

Medicare Supplement Plans Overview

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Prem

ium

Level of Coverage

F

G

N

ThefollowingexampleswillfocusonplansF,G,&N

~3% of 2018 policies*

~78% of 2018 policies*

~13% of 2018 policies*

*PoliciesenrolledbySeniorAdvisors

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Plan F Example – Part A

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Services Medicare Pays Plan Pays You Pay Hospitalization Semiprivate room and board, general nursing & misc. services & supplies First 60 Days 61st-90th day 91st and after While using 60 lifetime reserve days Once lifetime reserve days are used: Additional 365 days Beyond the additional 365 days

All but [$1,364]

All but [$341] a day

All but [$682] a day $0 $0

[$1,364] (Part A deductible)

[$341] a day

[$682] a day 100% Medicare Eligible Expenses $0

$0 $0 $0 $0 All costs

Skilled Nursing Facility Care You must meet Medicare�s requirements, including having been in a hospital for at least 3 days & entered a Medicare-Approved facility within 30 days after leaving the hospital First 20 days 21st-100th day 101st day and after

All approved amounts

All but [$170.50] a day $0

$0

Up to [$170.50] a day $0

$0 $0 All Costs

Blood First 3 pints Additional Amounts

$0 100%

3 pints $0

$0 $0

Hospice Care You must meet Medicare�s requirements, including a doctor�s certification of terminal illness

All but very limited co-payment/coinsurance for outpatient drugs & inpatient respite care

Medicare co-payment/ coinsurance

$0

2019

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Plan F Example – Part B

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Services Medicare Pays Plan Pays You Pay Medical Expenses IN OR OUT OF THE HOSPITAL AND OUTPATIENT HOSPITAL TREATMENT, such as physician�s services, inpatient & outpatient medical & surgical services & supplies, physical & speech therapy, diagnostic test, durable medical equipment

First [$185] of Medicare-Approved amounts Remainder of Medicare-Approved amounts

$0 Generally 80%

[$185] (Part B deductible)

Generally 20%

$0 $0

Part B Excess charges (Above Medicare-Approved amounts)

$0

100%

$0

Blood First 3 pints

Next [$185] of Medicare-Approved amounts Remainder of Medicare-Approved amounts

$0 $0 80%

All costs

[$185] (Part B deductible) 20%

$0 $0 $0

Clinical Laboratory Services TESTS FOR DIAGNOSTIC SERVICES

100%

$0

$0

2019

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Plan F Example – Part A & B

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Services Medicare Pays Plan Pays You Pay Home Health Care- MEDICARE APPROVED SERVICES n Medically necessary skilled care services & medical supplies n Durable medical equipment

n First [$185] of Medicare-Approved amounts n Remainder of Medicare-Approved amounts

100 % $0 80%

$0

[$185] (Part B deductible) 20%

$0 $0 $0

Other Benefits-Not Covered by Medicare

Services Medicare Pays Plan Pays You Pay Foreign Travel-Not Covered Medically necessary emergency care services beginning during the first 60 days of each trip outside the USA First $250 each calendar year Remainder of charges

$0 $0

$0 80% to a lifetime max. benefit of $50,000

$250 20% & amounts over $50,000 lifetime max.

2019

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Plan G Example

•  Plan G is the same as Plan F, except for the Part B deductible

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Services Medicare Pays Plan Pays You Pay

Medical Expenses IN OR OUT OF THE HOSPITAL AND OUTPATIENT HOSPITAL TREATMENT, such as physician�s services, inpatient & outpatient medical & surgical services & supplies, physical & speech therapy, diagnostic test, durable medical equipment

First [$185] of Medicare-Approved amounts* Remainder of Medicare-Approved amounts

$0 Generally 80%

$0 Generally 20%

$185 (Part B deductible) $0

2019

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Plan N Example

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•  Plan N is the same as Plan G, except for doctor copays and Excess Charges

Services Medicare Pays

Plan Pays You Pay

Medical Expenses IN OR OUT OF THE HOSPITAL AND OUTPATIENT HOSPITAL TREATMENT, such as physician�s services, inpatient & outpatient medical & surgical services & supplies, physical & speech therapy, diagnostic test, durable medical equipment

First [$185] of Medicare-Approved amounts Remainder of Medicare-Approved amounts *ER co-pay waived if admitted to the hospital

$0 Generally 80%

$0 Balance, other than $20 co-pay per office visit and up to $50 per ER visit*

$185 up to $20 per office visit and up to $50 per ER visit*

Part B Excess charges (Above Medicare-Approved amounts)

$0

0%

All Costs

2019

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H.R.2 - Medicare Access and CHIP Reauthorization Act of 2015

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Medigap Open Enrollment

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•  6-month Open Enrollment Period*

•  You may be eligible for Open Enrollment…

* Guaranteed Issue: Will not need to answer health questions (no medical underwriting)

…if you were previously covered under Medicare (SS Disability) and you turn 65, you have another 6-month

open enrollment period

Up to 6 Months after your Medicare Part B effective date

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Supplemental Guaranteed Issue

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When are Supplemental Guaranteed Issue Periods? No Medical Questions

You have guaranteed issue if… You can/must apply for a Medigap policy You have Original Medicare & an employer group health plan (including COBRA/retiree) or union coverage that pays after Medicare pays & that plan is ending.

No later than 63 calendar days after… Date coverage ends Date on the notice of coverage ending Date on a claim denial

You are in a Medicare Advantage Plan & your plan is leaving Medicare or stops giving care in your area, or you move out of the plan�s service area.

Early as 60 calendar days before the date your health care coverage will end but not later than 63 days after it ends.

Trial Right: You joined a Medicare Advantage Plan or Programs of All-inclusive Care for Elderly (PACE) when you were first eligible for Medicare Part A at 65, & within the first year of joining, you decide you want to switch to Original Medicare

As early as 60 calendar days before the date your coverage will end, but no later than 63 calendar days after your coverage ends

Trial Right: You dropped a Medigap policy to join a Medicare Advantage Plan for the first time, you have been in the plan less than a year, & you want to switch back

As early as 60 calendar days before the date your coverage will end, but no later than 63 calendar days after your coverage ends

Your Medigap insurance company goes bankrupt and you lose your coverage, or your Medigap policy coverage otherwise ends through no fault of your own.

No later than 63 calendar days from the date your coverage ends.

You leave a Medicare Advantage Plan or drop a Medigap policy because the company hasn’t followed the rules or it misled you

No later than 63 calendar days from the date your coverage ends.

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Medicare Part D: Prescription Coverage

Step 1: Annual Deductible

Step 2: Initial Coverage

Step 3: Coverage Gap

Step 4: Catastrophic Coverage

Who Pays What?

•  Memberpaysall•  Planpaysnothing

•  Memberpayspart•  Planpayspart

•  MemberpaysMOST•  PlanpaysaliGle

•  MemberpaysaliGle•  Planpaysmost

up to… $415

$435

LEGEND

<$3,820

<$4,020 *based on retail costs

<$5,100

<$6,350 *based on Tro-oP

>$5,100

>$6,350 *based on Tro-oP

TOTAL COST OF DRUGS

Many plans have $0 deductible.

COPAYS or COINSURANCE

25% of Brand-Name Drugs

37% 25% of Generic Drugs M

EMBE

RPA

YS: The greater of

5% or $8.50 $8.95 (Brand-Name)

$3.40 $3.60 (Generic)

~12%ofMedicareBeneficiariesreachthe

CoverageGap

Strikethrough:2019valuesOrangeText:2020Changes

2020

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~4%ofMedicareBeneficiariesreach

CatastrophicCoverage

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Not enrolling in Part B on-time

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•  Initial Enrollment Period

•  10% Penalty/year

•  COBRA

•  Retiree Plans

•  Social Security Disability

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Not analyzing prescription drugs

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•  Could cost you thousands of $$

•  30 different drug cards

•  Formularies are key

•  Medicare.gov

•  Annual Enrollment 10/15 to 12/7

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Medicare Advantage vs Medigap

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•  Networks & Referrals

•  Max. Out of Pocket Expense

•  Changes during Annual Enrollment

•  Extra Benefits

•  Overall expenses

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Not analyzing retiree coverage

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4

•  Premiums

•  Co-Pays

•  Co-Insurance

•  Compare all-in expenses

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Listening to Friends & Family

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•  Drug Cards

•  Advertisements

•  Analyze entire expense (not just prem.)

•  Association Plans (not guar. renewable)

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