50+ Lifestyles

Enrollment Periods Continue

By Richard J. Schillig, CLU, ChFC, LUTCF
Independent Insurance and Financial Advisor

The Medicare Annual Enrollment Period began Oct 15 and continues through Dec 7 allowing beneficiaries to change their choice of plans. Current Medicare folks satisfied with their plans do not need to do anything. Plans will renew  automatically. This AEP allows Medicare folks the option of changing plans if they choose to do so. Medicare recipients may choose Original Medicare and a Supplement and a Prescription Drug Plan. The alternative to Original Medicare is the Advantage Plan.

Our firm sponsors monthly Community Meetings to review the options with either choice. The Medicare Annual Enrollment Period allows for changes.

Another Enrollment Period began on November 1 for persons under the age of 65. The pre-65 annual enrollment period runs until the end of January. Special Enrollment Periods are available throughout the year. I want to share a Special Enrollment Period example with our readers partly to demonstrate the value of working with a professional in matters of major medical insurance.

A married couple both age 60 came to see me. Their COBRA coverage was expiring at the end of the month. They were concerned with the monthly cost of insurance and wanted to know what options available. Because they are losing coverage a SEP (Special Enrollment Period) became available for them. We are in the midst of the Annual Enrollment Period that could have been considered but with AEP, the effective date of the new insurance would have been January 1. In this couple’s situation, COBRA was ending at the end of the month. They needed coverage to be effective Nov 1. The SEP allows for coverage effective Nov 1st.

Further, you will recall that the monthly cost of insurance was a concern for this 60-year-old couple. The normal monthly premium would have been $994. However
with qualification on the Health Insurance Exchange (….remember the Exchange? That’s the government website created under the Affordable Care Act) this couple’s household income of approximately $50K qualified for a premium subsidy of $648. Their net cost of insurance then ended up being $346.

The regular monthly premium of $994 minus the premium subsidy of $648 results in a net monthly premium of $346. This premium was considerably less than the Cobra cost. The plan of insurance was a Bronze Plan $20 co-pay for primary care doctor office visits. It had a deductible for major medical services of $5,750 per person, but doctor office visits and prescription drug co-pays were not subject to the deductible.

I bring this case to your attention as an example of the kind of work we do and the value of working with a financial professional that knows and understands some of the options for major medical insurance. The Affordable Care Act did succeed for this couple in making major medical insurance more affordable. That was one of the objectives of that law passed 2010.

Major medical insurance brings in a considerable premium for both pre-65 folks and folks on Medicare. Call us during these enrollment periods to determine if you have the most cost effective major medical insurance plan.

Richard J. Schillig, CLU, ChFC, LUTCF is an Independent Insurance and Financial Advisor with RJS and Associates, Inc. He can be reached at (563) 332-2200.