Insurance Open Enrollment Season is Here

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Open enrollment season has started. This is the time when folks can choose any insurance plan, regardless of health status and not have any limitations for pre-existing conditions. Dates are different depending on the type of plan.

Medicare Part D (Prescription Drug benefits for seniors or those covered by Medicare) & Medicare Advantage (MA) and Medicare Advantage Prescription Drug (MAPD) plans: Oct 15 to Dec 7- Coverage changes are Effective 1/1/2017

MA & MAPD plans replace Original Medicare Benefits. One such plan is AARP Medicare Complete Secure Horizons. This plan will no longer be available in our service area starting 1/1/2017, so open enrollment is particularly important to those folks!

Individuals On and Off Exchange (Benefits for individuals not covered by employer sponsored health plans or not eligible for “affordable” group health plans: 11/1/2016 to 1/31/2017. Applications received prior to 12/15 will be effective 1/1/2017.

Employer sponsored group health plans: Many small group plans moved to either a 12/1 or 1/1 anniversary. Typically open enrollment is during the month prior to the plan anniversary.

All I can say about the withdrawal of the Secure Horizons plan is, “It’s about time!” The $35 monthly premium was quite attractive to those who seldom used their plan. However the out of pocket maximum exposure was about $6750, not including Rx costs. Few local doctors accepted the plan. It was a rude awakening when a members got sick.

One such couple was in this week. They had really done their homework. ‘John’ had tracked all of their copays and out of pocket expenses. They typically spent about $5000 each. By year end 2016, they will likely be at $6750 each.

When we looked at Medicare Supplement and Part D Rx Options, the total out of pocket cost including the Plan F or Plan G premiums, was likely less than they had been paying under the Secure Horizons Plan when all costs were included.

It will be important for this couple to choose their supplement wisely. Since they have ongoing health issues, it’s unlikely they would qualify to upgrade plans should they wish to do so later. There is another “Guaranteed Issue” period available to them each year in their birthday month. It allows them to change Medicare supplements. However, that 30 day period only allows them to make a lateral change, i.e. to the same plan in which they are enrolled. IF they want to upgrade they must submit to underwriting.

Those very healthy MAPD members may be able to offset the sticker shock with a High Deductible plan F. This $2180 deductible is the extent of exposure for Part A & B uncovered expenses. Between the Part A hospital deductible and 20% share of professional services, a hospital stay will pretty much guarantee the insured will meet that deductible.

On the other hand, if not hospitalized, the Part B deductible for outpatient services is only $166,and Medicare pays 80% of the “Medicare allowable” charge of covered outpatient services. Assuming one’s provider accepts Medicare assignment, it will take about $10,900 in eligible out-patient charges for the insured’s share of cost to reach $2180.

Typically, premium savings are $1000-1200 per year from the standard Plan F, to assume $2180 of risk. While this may not be ideal, it can help with the sticker shock.

Medicare Part D Rx Standard Benefits have changed. Calendar year deductible increased to $400 and the out of pocket threshold to get to the catastrophic level is up from $4850 to $4950. The infamous “donut hole” is closing a bit with enrollees’ paying about 51% the cost of generic drugs and 40% the cost of brand name drugs.

Each year, the plans change, so pay attention! First review the changes sent by the inforce plan. Be sure your medications are still covered at the same Tier on the plan’s formulary (approved Rx list). Look at the list of Preferred Pharmacies and confirm that yours is still on the list. If not, find the status and the new copay as well as which pharmacies are preferred.

The best way I know how to evaluate Medicare Part D Prescription drug plans is at www.Medicare.gov. Here you can input a list of your medications and your favorite pharmacy. Then you will see the TOTAL cost including premium, deductible and copays for the entire year, based on the medications you are now taking.

Of course, we are only one doctor visit away from a new drug, but at least you are able to project your costs using the retail pharmacy as well as the mail order options. We have step by step instructions on our website: www.insuranceredding.com. Another option is to make an appointment with HICAP at (530) 223-0999. Call right away as they fill up fast.

Margaret R. Beck
Margaret Beck  CLU, ChFC, CEBS started her insurance practice in Redding in 1978. As an insurance broker/consultant,  she represents businesses and individuals as their advocate.  She assists in choosing proper products, compliance with complex benefit laws and claims issues once coverage is placed. All information in her column is provided to the best of her knowledge, subject to final regulation by the respective agencies. Questions to be answered in this column can be submitted to info@insuranceredding.com. Beck's column is also published in the Redding Record Searchlight.
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