S1 E11:On a Budget? There's a "Medicare Advantage" to planning with a Certified Medicare Planner!

Today, Certified Medicare Planner Adam Frye shines the educational spotlight on Medicare Advantage Plans! Learn just what they are and what they do! Be sure to listen to the "Original Medicare" Educational Spotlight as well to be fully informed!

Email Adam? Adam@AmericanRetire.com
Looking for a workshop? WWW.123EasyMedicare.com
Call our office? 602-281-3898 

Transcript

Hello Happy People!  Welcome back to another episode of 65 and Counting, I’m your host Adam Frye. I’m a Certified Medicare Planner and I’m here to ask the important questions you want answered by industry professionals. This show is for anyone and everyone coming on that important milestone of 65 years old. That means retirement, it means medicare eligibility, or it means that you’re just plain interested in the world of retirement planning. Whatever it is, on this show, you’ll hear from the people that know it best.

I’ve got another great episode for you today. It’s time to shine our educational spotlight on Medicare Advantage Plans! What are they? What do they do? What kinds of plans are available? And who benefits from them the most!? 

But first! If you missed our workshops last week online or in person I’ve got some good news! There are still more in person and online workshops this month! For a complete schedule visit www.123easymedicare.com or give the office a call at 602-281-3898. I’ll include that information in the description of the episode. Also, American Retirement Advisors is working hard to prepare for the Annual Election Period! No, not that election. It’s almost time for AEP! I’ll get into detail about what that means and why it’s so important shortly BUT if you’re a current client of American Retirement Advisors, keep an eye out for some extra super-duper important emails coming later this month or early next month. We’ll also have a very special Annual Election Period round table episode, where all our advisors will come on to the show to discuss big changes!

Alright, enough housekeeping because we have got a LOT to cover in today's episode.

Medicare Advantage Plans….. Where did they come from?

Medicare Advantage’s roots trace back over 40 years! Medicare had offered “Managed Care” programs since the 1970’s but they didn’t really look like Medicare Advantage Plans until 1997.

That year, the government passed the Balanced Budget Act, which created the Medicare+Choice Program. The name changed to Medicare Advantage in 2003 and enrollment in Medicare Advantage Plans has been steadily growing since 2004! As of 2019 there were 22 million Americans enrolled in Medicare Advantage Plans! That accounts for about 34 percent of all Medicare Beneficiaries. And the federal government expects this number to grow to 24 million by the end of the year! 

So what exactly are Medicare Advantage Plans? 

Medicare.gov defines them as a type of Medicare Health Plan offered by a private insurance company that provide all the  contracts with Medicare to provide all of your Part A and Part B benefits. Most Medicare Advantage Plans also offer prescription drug coverage. If you’re enrolled in a Medicare Advantage Plan, Medicare services are covered through a private insurance companies plan. Your Medicare Services aren’t paid for by Original Medicare anymore (don’t forget to check out our episode on Original Medicare from last month if you haven’t already). 

Medicare Advantage Plans, sometimes called “Part C” of Medicare are a much more inclusive alternative to Original Medicare. Once you have your Original “Part A and Part B” of Medicare, you can transfer those benefits over to a private insurance company and they will take over as your insurance provider. If you join a Medicare Advantage Plan, your “bundled” plan includes Part A and Part B benefits and usually Part D Prescription drug benefits as well.

Medicare Advantage Plans cover all Medicare Services. Most also offer extra coverage which I’ll get into later. 

There are a few different types of Medicare Advantage plans such as HMO’s, PPO’s, PFFS Plans, and Special Needs Plans. There’s also HMO POS Plans and MSA Plans. For times sake, this episode is going to cover two of the more common Medicare Advantage Plans: HMO’s and PPO’S.

Now we call Medicare Advantage plans “All in One” plans around here. Why? Because typically you’ll find that your plan covers your doctors and hospitals, but in most cases they will also cover your prescription medications, dental, vision, and hearing. Some of them even give you credit to spend on over the counter pharmaceuticals and neat gadgets like Fitbits and Sonicare’s!

Typically you’ll find that you have copays and coinsurance for different medical services and medications. But fear not! Medicare Advantage Plans are required to put a cap on your liability, so you don’t break the bank, with Maximum Out of Pockets or MOOPS! Maximum out of Pockets are the most you’d be responsible to pay for medical expenses in a calendar year. In Las Vegas I’ve seen them as low as $999 and they’re regulated by the government so they can’t be higher than $6700 (in 2020) for in- network providers! Which brings me to my next point...

Let’s talk about Networks, because they are an important part of Medicare Advantage Plans. More often than not, with a Medicare Advantage plan, you’ll find yourself making use of a plan’s provider network. Most plans are geographically restricted by county. This means that the plan contracts with certain doctors, hospitals, and pharmacies to treat you. Typically you’ll need to seek medical services within these networks for plan coverage unless you need to use an emergency room or an urgent care. Or if you have a PPO, although with a PPO you’ll experience higher copays and coinsurance if you go out of network!

Speaking of HMO’s and PPO’s…… Just what are they?

Let’s start with an HMO:

HMO Stands for Health Maintenance Organization. They have their own network of doctors, hospitals, and other healthcare providers who have agreed to accept payment at a certain level for any services they provide. This allows the HMO to keep costs in check for it’s members. 

Since there’s an agreed-upon payment level, an HMO usually offers little to $0 in monthly premiums, compared to other types of insurance plans. They also tend to have lower copays and coinsurance, which helps make them more affordable. HMO’s are an affordable option for people who don’t usually need anything more than basic medical care like an annual check up or immunization. Although, due to network restrictions, out-of-network providers are not covered except in a true emergency.

With an HMO, you choose a Primary Care Physician from your network of providers when you sign on. This is the doctor that you see first when you need medical care. The PCP will have the best picture of your health and will be able to coordinate any additional care you may need. If you need to see a specialist, first you’d see your PCP and if needed, they’d provide you with a referral to see one. Although there are some Medicare Advantage Plans that allow you to see a specialist with no referral. 

Now on to PPO’s

PPO’s stand for Preferred Provider Organizations. A Medicare PPO Plan is a type of Medicare Advantage Plan offered by private insurance companies as well. PPO’s have networks, and you’ll pay less if you use doctors, hospitals and other health care providers that belong to a plans network. You’ll end up paying more if you use providers outside of your network, but they’ll still be covered. In most cases you can get your health care from any doctor or hospital you want. You have the flexibility to go to providers outside of network at a higher cost. Additionally most PPO’s will have a monthly premium where HMO’s for the most part cost $0 per month.

Some other fun facts about PPO’s are that you don’t need a primary care provider and in most cases, you don’t need a referral to see a specialist!

Medicare Advantage HMO’s and PPO’s are not the same as original Medicare or a Medicare Supplement. They’ll usually offer extra benefits not on Original Medicare, but you may have to pay for these extra benefits. 

In most cases HMO’s and PPO’s cover prescription drugs. And remember, if your Medicare Advantage Plan covers Prescription drugs, you can’t also buy a separate prescription drug plan. I’ve got a special episode about Prescription Drug Plans coming soon!

Let’s talk enrollment, because that’s a very important aspect of a Medicare Advantage Plan and there’s some important dates regarding enrollment coming soon. If you’re not yet 65 and have no qualifying disabilities or circumstances, then you’ve got a seven month window to enroll in to Medicare and transfer those benefits over to a private insurance company. That window starts three months prior to your 65 birth month, goes through the month of your 65 birth month, and then three more months after your 65 birth month. If you’re already on a Medicare Advantage Plan or if you’re on Original Medicare and a Medicare Supplement with a Prescription Drug Plan, your time is coming to switch! October 15th through December 7th is the Annual Election Period and during that time you can make changes to your coverage that will go into effect the first of the following year! I’m going to have more on that in an episode coming soon! There’s also some other special enrollment periods and open enrollment periods I’ll talk about in upcoming episodes. 

So all in all, if budget is important to you, Medicare Advantage could be the right way to go as they are more of a “pay as you go” type of plan. 

Remember that we always have Certified Medicare Planners standing by waiting to help! If you remember my episode about Certified Medicare Planners, you’ll recall that they research all the Medicare Advantage Plans in your area to help you find one that has your doctors and hospitals in the network, and your medications at the lowest cost! 

Thanks everyone for tuning in today! Don’t forget to like the video and follow us! And most importantly share with your friends and family! Tune in next week for another very special episode and have a great week!