My wife and I began our Medicare coverage 10 years ago. Part A (in-hospital care) was free and part B (health costs not involving in-hospital care) was $90 something per month or a little over $1000 per year for each of us. Part B pays 80% of those bills. We also bought supplementary policies to cover what Medicare doesn't pay. That was about $1800 per year for both of us. Finally I bought a part D policy to get reduced prescription costs. That was about $500 per year. So both of us were pretty well set with health coverage for a little over $5000 per year. No deductibles, no copay. Not bad. Over the years costs went up as we all know. My wife asked me write a check for our quarterly supplemental costs last week and I decided to review the whole thing because I was fairly sticker shocked. I called a well known medigap insurer and set up an appointment that occurred today. Since we started with Medicare they have developed a new type of medigap insurance known as Medicare Advantage. This was developed for people who had a problem affording what I and my wife had for coverage. Basically, the insurer makes a deal with Medicare. The part B payments are sent to the insurer as well as a portion of the FICA tax revenue and Medicare offloads part B onto the insurer and changes some of the rules. With Medicare supplemental policies, the insured pays up front for everything and enjoys freedom from copays, deducibles and management. The Medicare Advantage system is more of a pay as you go system. What it costs depends on how much health care you use. The basic coverage is almost free but you pay copays and deductibles for doctor visits, tests etc. So here are the brass tacks for those of you looking for medigap coverage. I visit my cardiologist twice per year and my oncologist once per year. I do my INR testing at home and it is covered by part B. Copay for the two specialists is $45 per visit or $135 per year currently. My annual scan carries a $90 copay and any visits to the family doctor are $10 each. My wife has a $0 premium for her Advantage policy because she doesn't have part D (prescription) coverage. She currently visits the family doc once per year. for $10 so, basically, she pays only the part B premium that is deducted from social security. That could change, of course, but we moved her from $3200 per year currently down to $1000 and change (the part B payments). My policy includes part D and has a premium of $15 per month or $180 per year and, since my prescriptions are all generic level 1 and 2, they are provided at no cost by the insurer. So my costs have gone from over $2800 per year down to something around $1300 at my current use of medical services. Since we have a reasonable amount of health care, the copays and premiums are a fraction of what we paid for the supplemental policies at least at the moment. To be fair, the Advantage policies, unlike the old supplemental policies, do not cover the part A deductible which is $360 per day in the hospital up to a maximum of 5 days. Another policy costing $44 per month can cover that if you wish. If our health care needs increase in the future so will the cost of coverage with the Advantage plan but they aren't likely to get anywhere near what we were paying before. My point in posting this is to share my experience and suggest that, if you have a supplemental policy you may want to look into an Advantage plan during the current enrollment period which ends at year end. If your activity with the health care industry is similar to ours, you will save a serious amount of money with a Medicare Advantage policy. It is worth checking it out. Give your agent a call.
