Medicare is about to get real.

[Greystache]

I will be going on Medicare in the next year. I have been retired since 2015 an have been on a bronze ACA plan with an HSA in retirement. My wife and I have been mostly healthy for the last 9 years and have accumulated over $70K in our HSA.  We do not have LTC insurance. We have about $1.8M in our investment portfolio and about $900K in home equity. We are very content with our current $60K per year budget. We have not decided when to start SS, probably not until FRA which is almost 67 for me and 67 for my wife. We now have to choose a Medicare plan.

Plan A is to buy a Medicare supplement plan and use our HSA funds to pay for premiums. I am leaning towards a supplement plan for the flexibility it offers and because of horror stories I have heard about poorly run advantage plans.

Plan B is to go with a Medicare advantage plan that will have much smaller monthly payments. We have access to a very good Advantage plan provider as long as we choose to continue living in our present location (most likely will not move any time soon). I have two friends who are currently enrolled and they both love it. We would probably not need to tap our HSA to fund the advantage plan. I guess we could then treat our HSA as our LTC fund.

What do you think we should do?

[iris lily]

I will be going on Medicare in the next year. I have been retired since 2015 an have been on a bronze ACA plan with an HSA in retirement. My wife and I have been mostly healthy for the last 9 years and have accumulated over $70K in our HSA.  We do not have LTC insurance. We have about $1.8M in our investment portfolio and about $900K in home equity. We are very content with our current $60K per year budget. We have not decided when to start SS, probably not until FRA which is almost 67 for me and 67 for my wife. We now have to choose a Medicare plan.

Plan A is to buy a Medicare supplement plan and use our HSA funds to pay for premiums. I am leaning towards a supplement plan for the flexibility it offers and because of horror stories I have heard about poorly run advantage plans.

Plan B is to go with a Medicare advantage plan that will have much smaller monthly payments. We have access to a very good Advantage plan provider as long as we choose to continue living in our present location (most likely will not move any time soon). I have two friends who are currently enrolled and they both love it. We would probably not need to tap our HSA to fund the advantage plan. I guess we could then treat our HSA as our LTC fund.

What do you think we should do?

Be sure to look very carefully at the limitations of the Advantage plans as regulated by your state. For me, I’ve heard too many “gotchas” about Advantage  plans. The Advantage plans dangle all kinds of pretty baubles in front of you such as Silver Sneakers gym memberships, vision and dental coverage.

Also, keep in mind that our government as a cost controlling measure wants to increase the number of Advantage plans out there. That should tell you something.

But coverage does vary from state to state.

Edited to add: I do see that you are aware of some limitations of Advantage  plans, good for you. But your Plan B includes going with Advantage plan? I have set aside how you pay for it as I read your post because I don’t understand how that really matters.

To me, LTC means long-term care which means nursing home which means $70,000 goes very quickly.

I’m not adding anything of substance to this discussion,  sorry! since you have plenty of money, I would probably just look at getting the absolute best insurance that is right for your situation. That’s what we did and our net assets, our retirement days, and our other factors are similar to yours.

We just went with a higher end supplemental plan.

[Rob_bob]

I recently started Medicare, I went with a Medigap Plan G.

I have read that you can not use a HSA to pay Medigap Plan premiums, not sure why since it can be used for B,C and D premiums.

[Dreamer40]

Going forward, I will always buy the most comprehensive health insurance available to me. My parents would be broke right now if they didn’t have their United Healthcare supplement to Medicare.

[iris lily]

Going forward, I will always buy the most comprehensive health insurance available to me. My parents would be broke right now if they didn’t have their United Healthcare supplement to Medicare.

agreed. We buy a Medicap plan (happens to be a G plan) to protect our assets mostly.

I will say that DH had appendicitis surgery last year, staying in the hospital a few days and the entire $32,000 bill was paid by the insurance policies. We paid not one cent.

[cwilkinson1ski]

My DH went on Medicare and Medigap part G in January - it's been fantastic.

Our advisor told us that you can easily switch from Medigap to Medicare Advantage at anytime but you can't make the switch from MC Advantage if you don't like it to Medigap.  So I thought we should try Medigap first and I can't be more pleased.

My husband had a total knee replacement in March and, including Medigap premiums, deductible ($226) and copays we will only be out a total of $1500 this year.

Highly recommend it!