Whether you are preparing to sign up for Medicare or deciding what to do about your coverage in 2020, navigating the maze of options can be challenging.
One resource available to help you — at no cost — is the state’s Senior Health Insurance Information Program, or SHIIP.
The confidential service offers counselors who can help Iowans make informed decisions about Medicare and other health coverage.
“People really have to decide if they want to take Medicare when they are 65, even if they want to continue to work,” said Kris Gross, director of SHIIP. “Many people are choosing to continue to work for a variety of reasons. They feel good, they are challenged by work, or because of financial necessity, they want to continue to work,” she said. “It is critical that they understand what their options are if they are going to continue to work.”
Medicare is a federal health insurance program for people over age 65; for some younger people with disabilities; and for people with end-stage renal disease. It has two main parts:
Medicare Part A: This helps pay for four kinds of medically necessary care: inpatient hospital care; inpatient care in a skilled nursing facility following a hospital stay; home health care; and hospice care.
Part A has deductibles and coinsurance, but most people do not have to pay premiums.
Medicare Part B: This helps pay for doctor services, outpatient hospital care, durable medical equipment, diagnostic tests and other health services and supplies not covered by Part A.
The top two misconceptions SHIIP counselors hear from Iowans are that they think they have to sign up for Medicare Part A at age 65 and that they have to enroll in Medicare Part B, even if they are continuing to work and have employer health insurance.
Neither is true.
Gross said keeping all options open will be important when people do decide to retire.
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“If someone is continuing to work and has private health insurance through their employer or they are covered by their spouse’s health insurance, they can delay signing up for Medicare Part A and Part B,” she said. “Delaying signing up for Medicare Part B saves having to pay the monthly premium.
“It also postpones the six-month Medicare supplement open enrollment period. That’s a once in a life time opportunity where you can get any Medicare supplement sold in Iowa. You have guaranteed coverage, you get the best premium, and there are no questions about pre-existing medical conditions.”
Gross said signing up for Medicare Part A or Part B halts employee and employer contributions to health savings accounts.
“When you do sign up for Medicare Part A, your eligibility is backdated a few months,” she said. “It is critical that people get good information.”
SHIIP counselors provide information and help fill out Medicare forms online, but they do not make recommendations or sell policies.
Medicare Advantage plans are an alternative to Medicare Part A and Part B.
Instead of having benefits administered through the governmentrun program, beneficiaries can choose to get their coverage through a private insurance company that contracts with Medicare.
Most Medicare Advantage Plans offer prescription drug coverage.
A Medicare supplemental plan, also known as Medigap coverage, is private health insurance that supplements Medicare Part A and Part B coverage. The policies are sold by licensed health insurance agents, and you pay monthly premiums to insurers.
“You only need to purchase one Medicare supplement policy,” Gross said. “Since Jan. 1, 1992, insurance companies selling Medicare supplement policies in Iowa are limited to selling standardized policies.
“Companies can only sell 10 plans identified by the letters A, B, C, D, F, G, K, L, M and N.”
Choosing a Medicare Advantage plan with Part D drug coverage typically depends on what medications are involved. SHIIP counselors can enter the names and dosages of drugs you take and provide a comparison of what you’d pay for coverage.
Drug co-payments are based on categories or tiers:
Tier 1: Lowest cost tier of prescription drugs, mostly generic.
Tier 2: Preferred generic drugs.
Tier 3: Preferred brand medications.
Tier 4: Non-preferred drugs.
Tier 5: Specialty medications.
When deciding whether to choose a Medicare Advantage plan or a Medicare supplement, several factors may influence the decision.
Pros and cons
Medicare Advantage plans often do not require payment of a monthly premium and also coordinate the delivery of added benefits, such as vision, dental and hearing care. But they also typically have higher annual deductibles and do not pay for 20 percent of outpatient coverage.
Medicare supplemental plans help take care of co-payments, deductibles and coinsurance that you are responsible for paying. But you pay premiums for that coverage.
The annual Medicare open enrollment period opened Oct. 15 and will close Dec. 7. During this period, Medicare beneficiaries can change aspects of their coverage.
They can switch from original Medicare Part A and Part B to a Medicare Advantage plan, or vice versa. They also can switch from one Medicare Advantage plan to another, or from one Medicare Part D (prescription drug) plan to another.
Not everything is covered
Dr. Jason Wilbur, a family medicine and geriatric medicine doctor at University of Iowa Health Care in Iowa City, said financial circumstances usually influence the choice of a Medicare Advantage plan or Medicare supplement.
“I tell patients to consider what kinds of medications they are taking,” Wilbur said. “If they are taking a lot of medications or expensive medications, they may end up with a Part D plan that doesn’t cover certain medications or force them to switch to other medications.”
Wilbur said some patients are surprised to learn what Medicare supplemental plans do not cover.
“They expect it to cover everything that Medicare does not cover, which is not the way it works,” he said. “They end up with some very unpleasant surprises.”
Where to find SHIIP counselors
SHIIP counselors can help you understand Medicare options. Offices are at:
• UnityPoint Health-St. Luke’s Hospital, 1026 A Ave. NE, (319) 369-7475
• Mercy Medical Center 600 Building (Eighth Street entrance), (319) 861-7887
• Iowa City/Johnson County Senior Center, 28 S. Linn St., Iowa City, (319) 356-5220
• Mercy Iowa City, 500 E. Market St., Iowa City, (319) 339-3658