Medicare Supplement Insurance Plans – Where Should You Start?

Typically the very first question that comes up for people going on Medicare is “Where do I even start?” There is no Medicare office. If you began drawing Social Security early at 62, you are likely already in the system and you can simply call your local Social Security Office to start your Medicare Part B.

If you didn’t start your Social Security early, you want to contact your local office. It’s always best to go early in the morning and you can get signed up for your Medicare Part B once you turn 65. For people turning 65 there are some very important things to consider when shopping for Medicare Supplement insurance plans.

What Do The Plans Actually Cover?

Medicare Part A is already paid for. This was deducted out of your paycheck while you or your spouse was working. However, Medicare Part B does have a monthly premium. Most people are shocked to find out how much it costs as the premium is approximately $100 a month. Along with the expense of Medicare Part B which covers doctor’s service is a monthly for a Medicare Supplemental plan.

Many people first getting on Medicare think this “benefit” will all be financed by the government. Many are then shocked how expensive it really can be. Medicare Parts A and B are termed “original Medicare.” This is the red, white, and blue Medicare card you’ll be receiving. There will be two dates on this card signifying the effective date of both Part A and Part B. If you held off on taking Part B Medicare due to employment by yourself or your spouse, then these two dates will be different. You want to keep that card safe because you’ll be giving that every time you get care.

In addition to Medicare A and B, which again is going to cost about $100/month (higher income earners will pay more) you will very likely also buy a Medicare Supplemental plan. These are often also called Medigap plans and they supplement the holes or “gaps” of expenses in original Medicare. The price of these can and does vary tremendously from plan to plan, and there are several plans, and from state to state. For example in New York, Florida, and California, it’s going to cost much more than if you’re a resident of Texas.  For Seniors that are snowbirds and go back and forth from state to state, you can choose residency of either state. Speak to one of our agents to check eligibility based on this. Again, if you bought Medicare Supplement Insurance Plan in Texas it would cost approximately 50% less than if you purchased it in Florida, even though the plans might have identical benefits.

How The Plans Work

Medicare Supplement insurance plans are different than any other type of insurance plan that you might have had in the past, because they are standardized by the government. For example, if you buy the most popular plan in America, a Medicare Supplement plan F, it’s going to be identical in benefits to a Plan F from every other company in the market.

So whether you purchase a plan from Blue Cross, United Healthcare, or Mutual of Omaha it will be identical. Medigap plans have been standardized for years now and it’s taken a lot of the fraud and abuse out of the industry. Although you can get a Plan F from several companies, price is not the only variable to consider when enrolling in one. The benefits might be the same, however the service will differ slightly. Most importantly however, is the company’s ability to keep yearly rate increases low.

Cost

Medicare Supplement rates go up every year, and sometimes twice per year. The good news is that you have a lot of different options with Medicare and you may change a Medigap policy any time throughout the year. Many people believe you can only change during the enrolment period from October 15th through December 7th, however this only applies to Part D drug plans and Medicare Advantage plans.

Medicare Advantage plans are an alternative to traditional Medicare Supplements. These plans come in a variety of versions including HMOs, PPOs, and Private-fee-for-service plans and they are an alternative to a Medicare Supplement, and the premium can be lower in some instances. These plans may or may not be a good option, and they might not even be available in certain counties.

Working with a qualified, independent agent can help make the process of shopping for Medicare Supplement insurance plans much easier. You don’t pay any extra, yet you can benefit from the experience and the many options that an independent agent has. As well, a good agent can shop the market each year for you, or any time you do get a rate increase to see if there is plan with lower premiums.

 

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