Low or No Cost Health Care for Seniors

Is there a better way for the 20,000+ Californians who turn 65 every month to afford their health care cost?

Medicare was signed into law on July 30, 1965 by Lyndon B. Johnson, as part of his Great Society.

Today, seniors live longer and healthier lives. Most seniors purchase a Medicare Supplement plan to cover the deductibles and co-insurance that Medicare does not pay for. As health care evolved, prescription drug therapy became an important tool in combating disease and keeping people alive. Unfortunately, many seniors could not afford the drugs they needed and had to make choices between basic necessities and their prescriptions. As a result, Congress enacted the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), which went into effect on January 1, 2006. Many insurance carriers offer various part ‘D’ plans ranging in price from $25 to $100 per month. The most popular Medicare Supplement, Plan F, costs about $155 per month. Add both Part D premium and the $121.80 that most seniors pay for their Medicare Part B, their total monthly expenditure is about $300.

Medicare Advantage Programs: Are they all HMO’s?

In today’s tough economic times it’s no surprise that one out of four seniors are enrolled in a Medicare Advantage (MA) product. With a MA product, seniors actually assign their Medicare over to an insurance carrier. The carrier is compensated by Medicare as the Center for Medicare Medicaid Services (CMS) now pays the carrier in lieu of the doctors and hospitals for health claims. Most Medicare advantaged programs are free or negligible in price, as the bulk of money comes from the government. Seniors will pay lower co-pays and deductibles than he or she would have by Medicare alone. MA products are not supplements to Medicare, but the senior does reduce his or her cost sharing as they would if they purchased a supplement. Most MA products are HMO’s. Insurance Carriers such as : Scan, Secure Horizons, Anthem Blue Cross & Blue Shield of CA are among the plethora of available plans. They provide an invaluable service for those who can’t afford to pay premiums monthly. Most MA products are MAPD or Medicare Advantaged Prescription Drug plans as prescription, Part ‘D’ is all inclusive. Part D coverage is covered in three phases:

  1. Initial. First $3,310 (2016) of combined drug cost, payment from both the insured and the carrier.
  2. Coverage Gap or ‘Doughnut Hole’ between $3,310 and $4,850. In this phase, you pay approximately 45% of the plan’s cost for covered brand name drugs and 58% for covered generics.
  3. Catastrophic coverage after total drug cost reaches $4,850. TROOP – True Out of Pocket cost, which is your own cost. You pay the greater of 5% or $2.95 for generic $7.40 for all other drugs.

Although Part D isn’t free, it is heavily subsidized by the tax payers. To help defray the cost of those who use prescriptions, the government tries to sway those who don’t use prescriptions to enroll in a Part D program too. This is done by penalizing late enrollees by 1% of the average part D premium nationwide each month that they don’t enroll. In today’s tough economic times many people who would not consider a Medicare Advantage Product are taking a fresh look, and new products are there to entice them. The problem with HMO’s is that many seniors will not consider changing their doctors. That’s why it’s important that you check the various carriers network to see if your doctor is participating. The HMO plans of today are measurably better than yesteryear. More doctors who want to join the medical groups are denied than accepted. The better Medical Groups do an excellent job of organizing the patients care and making sure that the various specialists all have access to the patient’s information and talk with one and other. For patients with chronic condition’s they often have special programs for disease management.

When Can I enroll?

Enrollment in these plans is only available during certain times of the year. The major window is Annual Election Period (AEP) from October 15th through December 7th for a January 1st effective date.  Depending on your situation such as loss of employer coverage you may be eligible for a Special Enrollment Period known as a SEP. Remember to check your prescriptions as different carriers have different formularies. It doesn’t make send to have a zero copayment as opposed to a $5 copayment if that $100 per month retail prescription isn’t part of the carriers’ formulary. Also compare the maximum out of pocket cost for the plans on your short list.