Questioning the NEED for additional insurance with Medicare

[Paula Sims]

Hi there,
I have a question about the NEED for additional insurance with Medicare

My parents, once on Medicare, got supplemental insurance for about a year or so and then dropped it because it was too expensive for them and they didn't see the benefits - most things got covered.

Just before Father died (2014), he needed heavy emergency surgery and then died shortly afterward. At that time he had ONLY Medicare - no other insurance (other than Medicare Part D). The bills with the ER, doctors, surgeries, ICU, etc were over $300,000 but we only had to pay about $1200 in total. Eighteen months later (2016), the same thing happened to my Mother, and again, only about $1200 in payments. And yes, same with my Uncle in 2015 (he spent 3 days in the ICU dying from a massive stroke & hemorrhage).

During their lives they went to the doctors as needed and everything was covered without additional insurance. Dad went every 3 months to the cardiologist and kept getting blood pulls, Mother to the regular doctor and gynie, and Uncle - well, he was a mess but went about every month or so.

Given that final bills were only about $1200 per person, that's less than a year's insurance premiums.

On the other hand, my Mother in Law had both - medicare and supplemental and we were always fighting as to who would pay what.

So given my experience, what's the purpose of having more than Medicare? I'm getting worried now because my husband is 63 and although I'm going to keep working for another 15 years (G-d willing) and he'll be on my plan, what's your opinion on all of this?

Thanks for your help

Paula

PS - yes, I'm for Medicare for all but that's pie in the sky - I need help now!

[MineralMan]

1. Well, it's a choice people have to make.

You have to do the math, as it applies to your situation and expectations. Some people don't buy the supplemental insurance, and then later regret not doing so. Others buy it and never really needed it.

It's a choice, really.

[sinkingfeeling]

2. Here's what Medicare pays this year. It is designed to only pay 80% of

medical expenses.

https://www.medicare.gov/your-medicare-costs/costs-at-a-glance/costs-at-glance.html

[riversedge]

4. Thanks. I am in about the same situation as the OP.

[GeorgeGist]

3. Medicare ONLY pays 80% of doctors fees ...

so I strongly suspect that you are misinformed.

[question everything]

18. And some doctors do not accept Medicare patients

because the payments are so low.

[still_one]

5. We pay into Medicare through our Social Security taxes and are able to collect when we turn 65.

That coverage is for Medicare Part A. Medicare Part B coverage is essentially for outpatient coverage, and the premium for that starts at 107/month/person. However, coverage is not 100%. It is usually 80%, unless the provider takes Medicare assignment as payment in full. For the services NOT covered, the 20%, that is why people buy a supplemental policy which also requires a premium. Depending on how comprehensive and flexible coverage one wants, a supplemental premium can cost anywhere from 100, 200, and up per month, per person.

Then depending, a prescription drug plan will include an additional premium.

The coverage for Medicare supplemental plans and what they cover and the out of pocket expenses are identified by letters A, B, .... F etc. An F Medicare supplemental is the most comprehensive. Little to no out of pocket expenses or deductibles, and more comprehensive.

In lieu of a Supplemental Plan, there are also Medicare Advantage Plans, which are usually less expensive premiums, cover more services that Medicare does not cover.

Medi-Gap or supplemental policies sold after January 1, 2006, do not include prescription drug coverage. Before that, there were supplemental policies that did include some drug coverage. If you want prescription drug coverage today, you need to sign up for Medicare Part D.

For those that need Part D, the premiums for Part D depend on one's AGI

Medicare Advantage Plans usually bundles things together and sometimes include things that Medicare does not cover, such as drugs, vision, and dental., but Medicare Advantage plans can limit where you can go, or what services are covered, and have more restrictions than standard Medicare Supplemental Plan such as A, B, C........F etc. The most comprehensive supplemental plan would be F.

The 107 dollars that you pay is for Part B, but if you elect not to go with a supplemental or a Medicare Advantage plan, you might be responsible for 20% of the cost of outpatient services.

Everyone's situation is different.

https://www.medicare.gov/your-medicare-costs/costs-at-a-glance/costs-at-glance.html#collapse-4811

[CurtEastPoint]

12. My Part B is much higher as I just retired and they look at recent year's income. FYI.

[SCantiGOP]

13. Same for me

I retired April of this year. My premium will go down once my tax form no longer appears to show that I am earning what I used to.

[CurtEastPoint]

14. Same here. April. They review things annually so I am hoping it will drop!

[SCantiGOP]

16. You may need to take action

I put a note in my tax file to call them after I get my 2017 taxes done. Since I only have 3 months of earnings I may be able to get it adjusted as soon as I can show them the tax return. I remember someone on the phone from Medicare telling me this might get the reduction in earlier.
BTW, I have been very impressed every time I had to call about either Social Security or Medicare. Not only is the phone answered quickly, but the info is accurate and delivered in very helpful manner. Yes, they are from the government and they are here to help you.

[CurtEastPoint]

22. Thanks for that info!

[still_one]

17. Absolutely right, and it can go up based on other factors. I was naming an average starting point

Supplemental scan and will go up also

[question everything]

20. This automatic rise can be waived for "life event" like retiring

see if you can talk to an agent.

We had a great agent. Spouse was self employed so could not provide a proof from the employer. But we found a letter notifying the client - was really only one - of the intention of closing shop and the agent did the magic.

[OldHippieChick]

6. Medicare is designed to only pay 80% of the doctors' fees,

but negotiates quite well w/ hospitals and ends up paying a lot more than 80%. Plus if the doctors are associated w/ the hospital, they pay more for that as well. I say this from my recent experience of two hospitalizations, one involving surgery and the ICU. I have only Medicare, no supplements. I had to pay no more than $1500 for each visit and they were both extensive stays. A supplement would cost me minimum of $300 per month, which is obviously more than I had to pay out of pocket. Recently I did go to a doctor not associated w/ the hospital and paid 20% of his bill, so I would say it really depends much on whether or not the doctors are associated w/ the hospital. But keep in mind they do pay more of the hospital.

[PoindexterOglethorpe]

7. Medicare Part A only pays for certain things.

Like hospital stays.

Part B, which they must have also had, covers a bunch of other stuff. There's a monthly cost for that, which is taken directly out of your social security payment. If you don't sign up for Part B when you are no longer covered by a plan through work, there's a permanent penalty to signing up late.

There are also Advantage Plans, some of which cost more than that monthly deduction, others of which don't. I have an Advantage Plan. Humana gets that Medicare Part B payment ($104.50 in my case. It's going to be more for your husband, and later on for you at the entry level, and more if your income is above $85,000/year) and it's better coverage than I had when I was still working. Like no doctor visit copays. No copays for generic meds. Plus there's some coverage for vision and dental, which otherwise aren't included under Medicare.

Here's a link to current Part B costs: https://www.medicare.gov/your-medicare-costs/part-b-costs/part-b-costs.html

There are some other supplemental choices out there, some of which make a great deal of sense for some people. It will depend on things like what kinds of meds you're taking, or what sort of health issues need ongoing treatment.

The thing is, there are a lot of choices, and what you can choose, at least so far as Advantage Plans go, will depend on where you live. So you're going to want to research this very carefully, and talk with friends locally about what they have and how it works for them.

Your husband will want to get Medicare Part A as soon as he turns 65. You might want to have a talk with your human resources department or whoever handles employee health care plans in your company to make sure you know exactly what you and he need to do when you each turn 65. If you work for a large enough company (more than 20 employees) the company insurance pays first, then Medicare picks up their share of what's left over.

It's all very complicated, I know.

Here's a link to a brief explanation of the different parts of Medicare: http://finance.alot.com/insurance/what-are-your-choices-for-medicare-coverage--10631

Where it gets confusing is Part C (Advantage Plans) and Part D (Prescription drug coverage). You want prescription drug coverage, and can get it by signing up for one of the plans on Part D, or going with an Advantage Plan that covers the drugs you currently need.

I think that one reason your relatives wound up with paying so very little of those huge bills, is that institutions that accept Medicare patients are not allowed to bill anything or not very much above and beyond what Medicare already pays for. Why your mother-in-law keeps on having issues about who is paying what is probably more a function of exactly who she has the supplemental policy with, not the fact of the supplemental policy.

I'll add this. One friend of mine has an Advantage Plan which costs her about $60/month over what's already deducted for Part B. She's very happy with it because it allows her free access to doctors who might otherwise be out of plan and cost her more, and provided incredible coverage after she had a pulmonary embolism several years ago. Somewhat like your parents she only paid a few hundred dollars after a week in ICU and another four or so days in the hospital. But again, that low cost to her might have been because of federal requirements that the hospital not charge much above and beyond their payment from Medicare.

So basically, Medicare is excellent for most people when it comes to hospital stays. Where it can be lacking is in other areas, including specialist visits or prescription drugs.

Good thing you are thinking about all of this so far in advance. You're going to have time to figure out what will work best for your husband in a couple of years, and for you down the road.

[tritsofme]

8. This doesn't add it up. As others noted, Medicare only covers 80% of inpatient charges.

It doesn't seem possible that the personal portion only could have been $1200 if there was no supplemental coverage.

I think it would be crazy to not have some sort of supplement to cover that 20%. No one is healthy forever.

And if you don't join soon after turning 65, or later if you and/or spouse are still working, then you may not be able to get supplemental coverage at all, or end up paying huge penalties.

[Demsrule86]

11. There was probably medicaid as well...low income seniors qualify for now...but won't if Grahams

deathcare repeal goes through as the ACA goes down and so does Medicaid which will be block grants.

[greatauntoftriplets]

9. I'm on Medicare and have a good supplsemental policy.

It's Plan F that still_one references above. Yet, right now I have two doctor bills to pay -- one for $159 and the other for $63.

My suggestion is to investigate further since the numbers you cite about your parents seem off to me. I wouldn't be without the supplemental coverage.

[Demsrule86]

10. Your parents may have qualified for Medicaid but Medicaid is under attack right now

and will go down if the Graham ACA repeal bill goes through. My sis in law had a hip replacement she is older than my husband and I ...she is disabled and on Medicare...can't get medicaid and until the ACA could not get additional insurance. Hubs and I paid the 20% deductible for the doctor and hospital before they would agree operate on her hip...she would have been denied the surgery if we didn't pay...also Chemo is an issue...single payer will never work in this country...but universal similar to Germany will work I think.

[Vinca]

15. I'm in the same boat as your parents. I can't really afford supplemental coverage, but

given the coverage Medicare has provided me so far I don't really see the need. I'm not poor enough to qualify for Medicaid, but I can easily cover what Medicare doesn't pay. My husband had a brief hospitalization a couple of years ago and we only had to pay about $300. I was really surprised.

[pnwmom]

19. With my husband there's NO QUESTION he'll choose the supplement.

He called his company's benefits department and asked what happens to his wife's coverage when he goes on Medicare (since I am younger).

The response: as long as he takes the company's supplement plan, his wife's coverage is included.

Once I am of Medicare age we'll revisit the decision.

[oppressedproletarian]

21. I decided against supplemental MC coverage

Last edited Sat Sep 16, 2017, 03:11 PM - Edit history (1)

after carefully investigating what my actual costs were likely to be. I was able to do this with online research. So far it has worked out very well, despite having had several expensive procedures. However, one must be prepared to pay some expenses, unless one qualifies for Medicaid, which I do not.

In my opinion the supplemental companies are taking advantage of most folks' ignorance/fear. Think about it, they would not be offering coverage if they did not make a healthy profit. Bonus: I get to skip the enormous hassle of dealing with a parasitic intermediary.

This is my own experience only and I would not presume to advise anyone else. YMMV.

[loyalsister]

23. There are limits on the number of hours of PT

and provisions for mobility equipment that are worth considering.

[PearliePoo2]

24. K & R nt.

[Paula Sims]

25. Thanks to everyone for your answers. . .

To clarify, my parents (Mother) didn't qualify for Medicaid (and wouldn't know how to if she did) and yes, that's ALL I paid after the hospitalizations ($1200), but I forgot to include (or assumed. . .) that most of the balance was "Medicare write off". Interesting part is when my Mother in Law had supplementary insurance, she never got "Medicare write off" because there was always another insurance to back things up.

So the moral of the story is - medical providers will take what they can get and hopefully there is more insurance to pay more of the balance. If not, they'll write it off.

However. . . another good point was made - a lot of doctors/specialists no longer take Medicare so we are at the mercy of who will take it. Most big hospitals will but it's your luck as to who the treating physician is.

We (as a country) are in perilous times indeed given what's being proposed. My husband is 63 and we don't need to make a decision yet, but we will and I need to make sure I have all information I can.

Thank you DU - for your love, support, and info!

[SoCalDem]

26. We have medicare (-$104 from check)

and Kaiser $159.00 additionally deducted, but nearly everything is covered. I had two strokes in 2015, and of the $45,000 billed, we only paid out of pocket $200 for the ambulance ride..The two brain MRIs were no cost to us. Thankfully. my recovery was more or less complete, and other than a few meds, I have been fine.

I recommend additional coverage IF you have assets to protect.. a home, some saved money etc.

If you rent, and are of more modest means, you might be fine to forego any additional coverage.

My husband is diabetic, and with my recent history, we kind of scared ourselves into the extra coverage.

[WillowTree]

27. I'm thinking maybe a Medicare Advantage plan was in play here.

Don't see any other way these numbers add up with traditional Medicare and no supplement.

[marybourg]

28. The $3000,000 is the hospital

"reaching". They don't get that amount from Medicare; they just "reach" for it. Medicare has a negotiated amount which they pay for each service. If your parents paid $1200, then Medicare paid about $5000.