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Welcome to Lesson 2, where we tee off into the details of Medicare Supplement and Medicare Advantage. Now that you've mastered Original Medicare, you've likely spotted the potential "gaps" left by Part A and Part B – a bit like navigating a challenging golf course.
Original Medicare comes with a potential $9,648 deductible on Part A and 20% coinsurances with no maximum under Part B. It's akin to facing hazards on the health course, with the potential for financial pitfalls. This is why many Americans opt to enhance Parts A & B with either a Medicare Supplement Plan or a Medicare Advantage Plan. These plans step in to cover the gaps, providing an extra layer of protection.
Whether you choose a Medicare Supplement Plan (also known as Medigap) or a Medicare Advantage Plan, keep in mind that you remain responsible for your $174.70/month Part B premium. It's like maintaining your club membership on the health course – an essential aspect to consider.
Think of Medicare as your skilled driver, getting you through most of the health course by covering a significant portion of the costs. Now, enter the Medicare Supplement, your expert irons on the journey. The supplement steps in to put it on the green for you, seamlessly filling the gaps left by Original Medicare. Together, Medicare and the supplement create a winning combination, with Medicare leading the way and the supplement covering the rest making sure you sink that final putt without a hitch.
Let's dive into the intricacies of Medicare Supplement Plan G:
In your initial year, anticipate Plan G to typically cost between $110 to $140 per month, influenced by your location, age, and smoking status. These rates may see an annual increase ranging from 3% to 10%. It's essential to note that this strategy will also require an additional premium for the Part D coverage, adding an extra layer to your comprehensive plan alongside the $174.70/month Part B premium.
Visualize Plan G as your strategic partner for comprehensive coverage – it covers everything except the Part B deductible. Once you've crossed the hurdle of the $240 yearly deductible for Part B, your Plan G supplement steps in to seamlessly catch all the "gaps" in Medicare. This ensures you're 100% covered for the remainder of the year, like navigating the health course without any unexpected hazards.
Here's the bottom line: With Medicare Plan G, your responsibility is limited to the Part B and Plan G monthly premiums after the initial $240 Part B deductible, along with the additional premium for Part D coverage. No hidden costs, just straightforward coverage to keep your health game strong and well-rounded.
Let's take a swing at understanding Medicare Supplement Plan N, a bit like opting for a more economical driver in golf:
In your opening year, depending on your area, age, and smoking status, Plan N usually comes at a cost of $85 to $100 per month, offering upfront savings with typical annual premium increases of 3% to 10%. It's like choosing a golf club that might not have the flashiest price tag but saves you on the front end.
However, this economical choice does introduce a few considerations when you use it. Alongside the Part B/Plan N monthly premium and the Part B deductible, there's a $50 copay for the emergency room – a bit like paying a fee when you hit the golf course hazards. Additionally, there's a $20 copay for a specialist visit, adding a bit more to your healthcare game when you make specific shots.
Just remember, while it might not hit the premium ball as far, choosing Plan N ensures you pay a bit less on the front end, offering a more economical approach to your health coverage strategy.
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Medicare Advantage Plans, often called Medicare Part C, are like your personalized golf strategy designed by insurance firms partnered with the federal government. Picture it as selecting the perfect set of clubs to enhance your game. While all Medicare Advantage Plans must include the same coverage as Original Medicare (Part A & Part B), they go the extra mile by offering additional coverage and benefits to help you cover gaps and limit liabilities.
Enrolling in a Medicare Advantage plan means waving goodbye to the Part A and Part B deductibles or coinsurance/copays. Instead, you receive your Part A & B benefits through an insurance company that provides set copays until you reach the Maximum Out of Pocket for the year. It's like having a cap on your health scorecard – you might take more hits to your wallet if you find yourself in healthcare trouble, but there's a reassuring limit on how much those hits can affect your overall financial well-being.
Now, here's the game-changer – you still need to pay your Medicare Part B premium, but the majority of Medicare Advantage plans come with no additional monthly costs to join. It's a bit like joining a golf club without an initiation fee – straightforward and cost-effective. So, while with a Medicare Supplement you'll have a premium to pay, with Medicare Advantage, you might pay less because most MAPD plans have no premium and come with copays, creating a more flexible and wallet-friendly healthcare game.
Navigating through Medicare Advantage Plans is a bit like selecting the right club for different shots on the health course – it's essential to understand the coverage nuances and costs that come with it.
These plans are provided regionally, and benefits may vary based on the plans available in your area. It's a bit like choosing the right club for specific course conditions. If you have a preferred doctor, ensure they are "in network" with the Medicare Advantage Plan you choose – think of it as selecting a club that suits your swing.
Now, when it comes to the costs, copays and expenses across most Medicare Advantage Plans are fairly consistent. It's like having a set cost for each shot on the health course. The key factor to consider in selecting a plan is the MAXIMUM OUT OF POCKET – think of this as your safety net, not a deductible. The lower this number, the less you'll potentially spend in copays throughout the calendar year. It's like having a lower cap on your total expenses, ensuring a smoother financial journey through the health course.
Example Plan (this is a made up plan, not an actual plan:
- Monthly Premium = $0
- Primary Care Visit = $0
- Specialist Visit = $20 copay
- MRI is $150
- Hospital is $300 per day for the first 6 Days
Lets pretend the example plan has a Maximum Out of Pocket of $3,500.
Example of how you would hit the Maximum Out of Pocket:
January: In January, you visit your primary doctor. Your expenses are $0.
February: It was a bad month... you went to the specialist 10 times. It was a $20 copay each time, so you ended up spending $200 for the month.
March: It was an even worse month. You spent 2 weeks in the hospital. You must pay $300 a day for the first 6 days. This results in a total of $1,800 in hospital fees.
At this point, your total charges for the year are $2,000.
April: Things have progressively become worse. You are now back in the hospital and end up staying 3 weeks. Like last month, your first 6 days are at $300/day, resulting in another $1,800. However, since you have now spent over $3,500, you have met the Maximum Out of Pocket for this year.
Any other services are 100% covered with no copays.
May: You go to a specialist to get an MRI. Typically, specialist visits are $20 and copays for an MRI are $150. Because you have already reached the plan's Maximum, you would not pay copays for either of these services.
Now that you have been educated on the different options, lets take a simplified look and compare:
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