What’s a Final Expense Plan?

Final expense plans are, quite simply, small life insurance policies. They are designed for people who no longer need to have large policies to cover their mortgage, or the education of children still at home or the loss of income for a family breadwinner. For folks on Social Security and Medicare, those situations don’t usually exist anymore.

However, there typically is still a need for a small amount of coverage to help out with final legal and funeral expenses so that a surviving spouse or adult children won’t have to suddenly come up with a substantial lump sum, often $20,000 to $30,000. For this specific situation, Final Expense Plans were created.

They are offered in three varieties depending on a person’s health. For those in excellent health there is the Level plan and you must medically qualify for this one. Next, for those with health challenges like diabetes, high blood pressure or weight issues, there is the Graded plan which has a slightly higher premium and offers a limited payout in the first two years of the policy. And, finally, for people with more serious medical problems, there is the Guaranteed Issue plan that has no medical qualifications at all. This plan has a higher premium and, like the Graded plan, has a limited pay out during the first two years of the policy.

If you would like additional information on a Final Expense Plan for yourself or a loved one, please give me a call at 263-2194 or use the Contact Form on our website.

Changing Medigap Plans? Be Careful!

Shopping for Medigap PlansSo you have had your Medigap (Medicare Supplement) Plan for several years, the price has gone up and you’re thinking of switching. No problem there, but keep a few things in mind to avoid shooting yourself in the foot.

First, recognize that almost all plans have rate increases. It is important to compare your plan to others to see if the increase is reasonable. If you feel it is not, then go ahead and shop around. I suggest using an agent that specializes in Medicare products but you can certainly do it on your own.

Make sure you are comparing similar plans. This is easy with Medigap Plans because the federal government began requiring companies to standardize their plans many years ago. If you have a Plan F, then a Plan F from another company will be the same in all major respects. It doesn’t hurt to check a company’s AM Best rating just to see how it compares to others. Certainly, you want a financially sound company backing up your plan.

Most importantly, remember that Medigap Plans are medically underwritten if you are not in your Open Enrollment Period or in a Guaranteed Issue situation. This means that the company can take a look at your current health situation and legally decline to offer you coverage. Most applications have “key” questions that clearly state that a “Yes” answer disqualifies you for coverage. But even if you answer none of those questions positively, you may still be declined.

Even if your application seems to be perfect, never — and I repeat here NEVER — discontinue your current Medigap Plan until you have the new policy and ID cards in your hands. I say this even if it means that you pay two premiums in the same month while you wait for approval. The reason should be obvious. If you cancel your current plan, then two weeks later receive a declination from the new company, you have NO Medigap Plan.

So, shop wisely, purchase carefully and if you need help call me at (208) 263-2194 or fill out the Contact Form.

Will Trump Change Medicare?

As the Trump presidency looms ahead of us, it is important for those of us either on Medicare or soon to be to take a look at what the new administration may bring to Medicare. Although there are many possibilities, there are a couple of areas worth considering.

Republicans, and the President-Elect, have vowed to repeal the Affordable Care Act (ACA), also known as Obamacare. No one has yet offered a specific plan for replacing the program and there are differing opinions within the party whether to keep some of the ACA’s more popular provisions or throw the whole thing out. What does that have to do with Medicare? Plenty! Within the ACA are several provisions that directly impact the Medicare system. Despite the fact that candidate Trump campaigned on promises to keep Medicare intact, the fact is that the repeal of the ACA will severely damage Medicare.

The ACA included provisions that strengthen Medicare by reducing its costs and increasing its revenue. These include reducing Medicare payments to providers, increasing revenue with higher taxes on high income individuals, closing the “doughnut hole” in the Part D Drug Coverage and much more. For a more thorough discussion, see this article from the non-partisan Kaiser Family Foundation. The bottom line is that if all of these provisions are repealed along with the ACA, the Congressional Budget Office estimates the additional cost to the Medicare program over the next 10 years will be $802 Billion! Yes, BILLION!.

How will that additional cost impact Medicare Beneficiaries? Higher Part A and Part B deductibles, higher premiums on Part B, higher premiums for Medicare Advantage plans, higher out of pocket costs for medical services and more.

A second area of concern is that House Speaker Paul Ryan has long advocated for the privatization of Medicare. Until now, he has not had the support in Congress to push it through. But with a Republican controlled House, Senate and now the White House, things are different. Ryan indicated in a recent Fox News interview that he is now ready to move ahead with his plan. Ryan continues to justify his plan by stating that Obamacare is causing Medicare to go broke. That is at complete odds with the Congressional Budget Office that, as indicated above, has already determined that the repeal of the ACA will cost Medicare nearly a Trillion Dollars.

Under Ryan’s plan, a person on Medicare would receive a voucher for a certain amount and would apply the funds (premium support) toward a private insurance plan. Supposedly, those on Medicare currently could continue with the plan. There is some doubt however, about the future of traditional Medicare if that happened. With no more new people coming into the program, those in it would become older and sicker and the program would probably go broke quickly. So much for being “allowed” to stay on original Medicare!

It is important to understand the strategy of the incoming administration and to pay attention to all proposals submitted. If there is an attempt to gut Medicare, rest assured that it will be sugar coated and quite possibly tucked away inside some other legislation. It is important for every beneficiary who depends on Medicare to be alert and let your elected representatives know how you feel about Medicare. There are those who believe that if Ryan and others in the GOP have their way, Medicare as we know it could be gone by next Thanksgiving.

Introducing Idaho Senior Insurance

Medicare Insurance Products

I am pleased to be able to launch my new website, Facebook page, and Twitter feed for Idaho Senior Insurance products for Medicare beneficiaries. While the introduction of these new media sites marks a significant change in my insurance practice, it is important to note first what is not changing:

  • I still work for North Idaho Insurance, an office of Alliant Insurance Services, Inc.
  • North Idaho Insurance still offers a full spectrum of insurance products for Business, Commercial, Auto and Home needs. In fact, our agency just moved into more modern and spacious offices at 509 N 5th Ave Ste H, in Sandpoint and added another experienced agent to handle the growth of the agency.

So, what is changing?

  • I am now concentrating my personal practice on Senior Insurance products such as Medicare Supplements, Advantage and Drug plans, Final Expense plans and Dental and Vision plans.
  • I will continue to service all of our agency’s individual and group health and life clients as well.
  • By focusing on just one area of insurance, a pleasant side effect is that I will usually be able to work less than 5 days per week.

Over the years many of my clients have found the area of Senior Insurance products to be confusing and intimidating. Unfortunately I was unable to devote the time necessary to expand this part of the agency as long as I was also committed full-time to our Commercial and Personal Lines products as well.

Now, by concentrating solely on this area, I have been able to take on the additional companies and products needed to offer my clients the widest choice of plans and pricing available. In addition to companies I have long represented such as Blue Cross, Regence, Bridgespan and Delta, I have now taken on Senior Insurance industry leaders like Humana, Aetna, Security Life, PacificSource and Transamerica, among others.

So if you are a Senior (like me!) and need to review your coverage, or you happen to be approaching that landmark Medicare age of 65, be sure to phone me for an appointment at (208) 263-2194 or submit the Contact Form.

For over 30 years I have enjoyed helping people find solutions to their insurance needs and I look forward to continuing that process with this new area of specialization.

Medigap or Medicare Advantage – Which is Best?

Which is best, Advantage or Medigap?Folks on Medicare find out quickly that, as nice as it is to have Medicare, the program simply does not pay for everything. Most everyone faces a choice of selecting a private plan to make up some of the difference. The most common choices are either a Medicare Advantage Plan that includes Drugs, or a Medigap Plan combined with a separate Drug Plan. I often get the question, “Which is best?” As with so many such questions, the correct answer is that “It depends.”

The Medigap plans are more accurately called Medicare Supplement Plans and they come in several different options standardized by the federal government into “lettered” plans (Plan C, Plan F, etc). These plans have been around a long time and although each plan varies, they can pay some or all of your Part A (Inpatient) Deductible, Part B (Outpatient) Deductible, the other 20% of the Medicare approved amount for certain services, the balance left over when doctors charge in excess of the allowed amount, some coverage for out of the country needs and so forth. What is common about them is that they can be used with any doctor that accepts Medicare. So, no networks, no referrals, no having to choose a Primary Care Provider. Medigap Plans do not cover drugs so it is necessary to purchase a separate Part D Drug Plan (PDP) to cover that aspect of your health care.

Medicare Advantage Plans have been around in one form or another since the 1970’s. Rather than filling in the “gap” in what Medicare doesn’t pay, they actually replace Medicare for your coverage. They typically don’t have deductibles for inpatient or outpatient care but it is common for them to have co-pays for doctor visits, a certain number of days in the hospital and so on. Many are HMOs and some are PPOs, but what they generally have in common is a preferred network of doctors and providers. If you go out of network you either pay more or, in some cases, have no coverage at all. The exception is that emergency and urgent care is almost always covered at in-network pricing regardless of where you are when the incident happens. Medicare Advantage Plans generally have the option of including Drug coverage in the plan. Medicare Advantage Plans, by and large, cost less than a Medigap Plan combined with a separate Drug Plan.

People who travel a lot, perhaps spend months in Arizona or elsewhere, may find Medigap or Supplement Plans to be a better fit, despite the higher cost, because there are no network restrictions. For people who get their primary care near their home and might only need emergency care when occasionally traveling, may find a Medicare Advantage Plan more to their liking, but it is important to examine the network and make sure it works for you.

Finally, since Medigap plans tend to leave you with less to pay out of pocket for doctor visits and hospital stays, I also usually recommend that you carefully consider your own health history before purchasing either type of plan. If you visit the doctor often or have just a couple of hospital stays, the savings of the Medicare Advantage lower premiums can quickly disappear in multiple copays.

As with all such decisions, I recommend that you sit down with an insurance agent that specializes in this sort of coverage, or do some very careful research on your own. To set up an appointment with me, just phone or return the Contact Form. To research on your own, the best place to start is the official government website, Medicare.gov.

Ready for AEP?

medicare-wp-sizeAnnual Election Period starts October 15 and runs through December 7. This is the time when anyone with a Medicare Advantage plan or a Part D Drug plan can change to a different plan. Also, a person with a Medicare Advantage plan, also known as Part C Medicare, can decide to drop their plan and revert to original Medicare. If you do that, don’t forget that you will need to purchase a separate Part D Drug plan at that time.

Naturally, if you are happy with your current plan there is absolutely no reason to make a change. By now, you should have received your annual Notice of Changes for your plan for 2017. Don’t ignore this letter! You may find that not only the premium has changed but coverage may have changed as well. Perhaps last year your plan had no Drug Deductible and for 2017 it will have a deductible. Don’t wait until you fill your first prescription in January and be surprised.

It is easy to compare plans. You can do it yourself by going to the official Medicare website and take a few simple steps. If you are not comfortable with a computer or just prefer some face-to-face help, call an insurance agent that specializes in Over 65 products. Make sure the agent represents several companies so you won’t be getting information on only one plan.

Also, don’t be swayed to automatically purchase a plan just because you see it advertised on television all the time. While those plans may be just fine, their premiums vary from state to state and even county to county. And never forget, television advertising is expensive and the cost of marketing obviously has to be included in the premium.

The main thing is, time is short! The Annual Election Period ends on December 7 and if you hesitate you may be stuck with a plan you don’t like for another year. So go online or call an agent today to get started.