Retiree Insurance vs. Medicare

[lizzzi]

I will be 65 in seven months, and apparently must sign up for Medicare at $109 per month or whatever it is, or else have to pay penalties. I already have retiree insurance through my state retirement system (left the workforce 14 months ago to take care of family.) This insurance is $310 per month and some change. So in trying to live on a Mustachian $2083/month, health insurance costs are going to be more than $400/month. That seems insane. I have no health problems at the moment (knock wood), and no prescription meds. I pay privately for eyeglasses and dental care. So…should I drop my retiree health insurance (NYSHIP--New York State Health Insurance Plan) and just use Medicare A&B and private pay for any health care needs in the future?  I can't find any information about this online…do people use Medicare as their only health insurance?  Thanks in advance for any wise counsel. (I'm probably also eligible for VA benefits…USAF, Vietnam-era veteran…but I've never needed them, so never tried to enroll.)

[Workinghard]

I'm interested in the replies too although it wii be a few years for my dh. 

As far as insurance, most of my patients have Medicare. Some also have private insurance but it's secondary. Most home health companies do not want private insurance patients and often just take them as a courtesy to the physicians who give them Medicare patients. It's difficult getting consent from private insurance for nrsg care, PT/OT and other disciplines.

That's the extent of my knowledge.  Lol

[lizzzi]

Thanks, Workinghard. I had noticed that in home health care, too. Skilled nursing, OT, PT, and the home health aide were billed to Medicare for a certain period (nine weeks??) after a hospitalization. Home care needed after that was either Medicaid if the person was low-income enough…or private pay. I'm just wondering if it's wise to save the $300 per month that I'm paying for retiree health insurance…use the Medicare for doctor visits, hospitalizations, the days permitted in a nursing home, God forbid…and just private pay for everything else out of my 'Stash. Any senior Mustachians have any input? Any health care workers/case manager types out there?? What do you think?

[bogart]

As I am reading this document:

http://www.upstate.edu/hr/document/nys_retiree_faq.pdf (which may not apply to your case but appears to be intended for people in your situation in general -- obviously you should check, I'm no expert), it appears (see p. 3) that NYSHIP will pay your Medicare premium:  "The State will reimburse you and your eligible dependent for the cost of Medicare Part B monthly premiums unless you receive reimbursement from another source."

If that is not the case, you may (besides the possibility of dropping the NYSHIP and non-Medicare coverage in general altogether) want to look into Medigap plans.  I have no idea how these are priced in NY, but you may find one that is less expensive than the NYSHIP.  They are intended to provide additional coverage (beyond Medicare), are, I believe, standardized and strictly regulated (i.e. depending on type -- there are different levels of coverage -- must cover a standard set of things at a standard level).  You can get an overview of what a Medigap plan is, and what the options are, here:
http://www.medicare.gov/pubs/pdf/02110.pdf .

[Abe]

A lot of patients I've seen have Medicare along with a private insurance plan, but they tend to be sicker than usual. It is mostly useful for high-expense items that Medicare does not fully cover, such as certain types of rehabilitation or certain very expensive medications. If you have, or are at risk of developing, an illness that requires frequent visits to specialists, private insurance is beneficial since Medicare sometimes balks at certain tests/vists.  That being said, Medicare is fairly reasonable at covering essential screening tests, regular physician visits or acute illness that rack up big bills.

[Workinghard]

And just to clarify, most Medicare home health visits (with my company) are short term from 3-4 weeks. If it's a post op visit, skilled nursing is only needed for about 3 weeks. Obviously wound care pts with ulcers need more time. PT, OT, ST can be extended if maximum potential hasn't been reach.

[lizzzi]

After carefully reading the NYSHIP website for the Empire Plan, I found out that  the Medicare premiums are, indeed, reimbursed. Also--and this will be important for me--if you receive health care outside the country, the Empire Plan does cover it. My gut feeling is that as long as I can continue to pay the premiums as I have been doing, the retiree insurance plus Medicare will provide a pretty good safety net if I ever need it. The premiums are already budgeted in under my Mustachian spending, and I think I'll just continue to pay them as I have been doing. I've seen people who were totally healthy have something unexpected happen--like a hypertensive crisis that came out of nowhere--or some kind of car accident--and under those types of circumstances, a decent  depth of health insurance would be useful. I personally would prefer health care from a shaman burning incense and casting spells in a teepee…but that's just me.  I suppose if I do have to go to some boring conventional MD or get my appendix out or whatever, it would be nice to have good coverage.

[lizzzi]

At age 65, Medicare will be the primary, with the retiree insurance secondary. I've been reading here and there (no links…sorry) that Medicare reimbursements are becoming lower, and fewer MDs are accepting Medicare…another reason to keep the retiree insurance. I wonder what the billing mechanism is for shamans; probably private pay only. lol

[Nords]

Thanks, Workinghard. I had noticed that in home health care, too. Skilled nursing, OT, PT, and the home health aide were billed to Medicare for a certain period (nine weeks??) after a hospitalization. Home care needed after that was either Medicaid if the person was low-income enough…or private pay. I'm just wondering if it's wise to save the $300 per month that I'm paying for retiree health insurance…use the Medicare for doctor visits, hospitalizations, the days permitted in a nursing home, God forbid…and just private pay for everything else out of my 'Stash. Any senior Mustachians have any input? Any health care workers/case manager types out there?? What do you think?

I'm no expert, but I've been taking care of my Dad's finances for the last three years.  He's 80 years old now.

When he was hospitalized three years ago, the emergency surgery and recovery was over $50K by itself.  The skilled nursing facility billed $220/day.  There were plenty of other medications and "additional" fees.

Medicare would have covered about 80% of the bills (and all of the SNF) but we still had thousands of dollars of "other medical" bills rolling in.  It was a tremendous relief to merely redirect the biller to Dad's Medicare supplemental insurance company.

Later in 2011 he was treated for multiple myeloma:  chemotherapy and medications.  MM is apparently not uncommon among seniors.  The anti-nausea pill alone costs $250-- per dose.  It's a big relief that he has prescription insurance.

In 2012 Dad was hospitalized again for a couple of weeks, and eventually administered more medications.  Another few thousand in bills, again referred to the supplemental insurer.

Now that Dad's in a full care facility, he still has frequent doctor's checkups along with several types of therapy:  occupational, physical, speech.  Most of the expenses are paid by Medicare but the copayments add up to several hundred dollars per month.

In 2011 the annual cost of Dad's Medicare supplemental insurance policy was about $3700.  Last month the renewal price was $4400.  He's still ahead on claims, and I have no way of predicting whether he'll ever have fewer claim dollars than premium dollars.  However my peace of mind (and lack of bill-paying paperwork) has been priceless.

[Workinghard]

Nords, what Medicare supplemental insurance and prescription insurance does your dad have?

[lizzzi]

Workinghard, after reading about Nords father, I think researching the Medigap policies would be a good idea if there is no other insurance except Medicare. (After reading some of the stories on the "Medical Expenses" thread, I am starting to realize how lucky I am to have that retiree insurance from New York State.) I think one approach would be to check with your local Office for the Aging (may be called something different…Area Agency for Aging…whatever. They should be well-versed in Medicare issues, and can probably offer good information regarding what's available in Medigap policies--which based on Nords experiences, are probably needed. I guess the question is: how affordable are they?

[Workinghard]

Lizzzi, you're right. The cost is a huge factor. Things change so I probably won't do a lot of researching until it gets closer to my dh's retirement. I wish he was a little less doctor oriented.  Lol. We're polar opposites when it comes to medical care.

[Nords]

Nords, what Medicare supplemental insurance and prescription insurance does your dad have?

Back in 1999 (when he turned age 65) my Dad chose Bankers Life and Casualty for his Medicare supplemental insurance.  I chose not to mess with it and have just renewed it each year, but I keep flipflopping between a short-term perspective and a long-term perspective.  That's the hardest part of taking care of Alzheimer's finances.  That perspective switching is probably one of the hardest parts of Alzheimer's caregiving, too.

I don't have any experience with other Medicare supplemental insurance companies, and you might have better choices.  The good news is that I tell billers to send their invoices to Bankers Life, and I never hear another peep from the billers.  A month or so later I'll usually get an explanation of benefits from Bankers Life that so-and-so has been paid.  The not-so-good news is that if the biller doesn't do it right then BL sends the check to me, not to the biller, and it comes without an EOB or a cover letter.  I have to match the amount of the check to the biller's invoice and then call the biller (or BL) to figure out the problem.  (It took me about six months to figure out that issue, but back then things were kinda chaotic.)  My other frustration with BL is that they don't have a website where I can look up a history of Dad's claims & payments.  I don't know whether other insurers do that either, but it seems awfully stupid to keep snail-mailing me reams of paper when we could do this all online.  That's probably misguided HIPAA paranoia.

Bankers Life works so hard to make their marketing and communications materials simple, pleasant, and customer-friendly.  I find them just this side of patronizing and condescending.  When I changed my Dad's mailing address to my home, someone (I'm not able to identify the culprit) put Dad's name on the mailing list of all the local Bankers Life agents... as well as every Medicare-oriented company and geriatrics product business on the island.  Three years later I'm still stomping out the smoldering embers of that junk-mail wildfire.

[rant] Side issue:  what really pisses me off are the medical billers who send one invoice and then turn the account over to a collection agency.  Just what the patient (or the caregiver) needs-- more threatening letters and phone calls.  Luckily these miscreants are less than 5% of the billers, or maybe they don't stay in business very long. [/rant]

Dad's prescription insurance came through his Westinghouse (CBS) pension in 1999:  Medco.  Medco was bought out last year by Express Scripts, which seems to be the only remaining prescription-insurance company-- or at least the 800-pound gorilla.  I'm also reluctant to try to shop around this benefit for a better deal. 

I do not care for Express Scripts.  They have difficulty understanding why an Alzheimer's patient would need more than one year of anti-depressants and why a care facility won't use Express Scripts' mail-order refill service.  Both times I've had to coordinate extensive correspondence between Dad's doctor and Express Scripts to get a "waiver" to maintain the status quo.  Express Scripts also has absolutely no respect for a state probate court order appointing a conservator.  Luckily they were able to believe that Dad signed me up on their website as his "authorized representative" so that we could work on the aforementioned waiver paperwork.  Again, this sort of HIPAA charade gets very tiresome at precisely the time that the caregiver is the most frazzled-- and Express Scripts must only go through this kabuki script about a thousand times a month.  Their educational materials are way over the line into the patronizing/condescending category, complete with full-color images of stereotyped white-haired smiling elders.  Their website is just as bad-- "You just signed up for our website notification service-- you're taking charge of your health!  Good for you!!"

Express Scripts' website is still better than BL, but Express Scripts also continues to send threatening letters about mail-order refills.  It took me a couple of frustrated phone calls to realize that their mail-order waiver is valid for at least a year, but it takes almost as long for them to shut off the auto-mailer.

The good news is that I only had to make one phone call to the pharmacy that serves Dad's care facility, and they promptly connected with Medco/Express Scripts.  The pharmacy seems like a small local business with an outsourced biller service, but the monthly copay for Dad's half-dozen meds is only about $25-$40.  They were also a big help in 2011 with Dad's anti-nausea meds for his chemotherapy, because each dose cost $250-- after the copay.  They're pretty responsive to phone calls and e-mails. 

I'm probably preaching to the choir, but here's my suggestion to anyone of Medicare age:  teach your responsible adult children how to take over for you.  Don't just show your spouse or a sibling/relative of your generation-- they have enough on their hands already.  If you don't have responsible adult children then find a local geriatric care manager who will keep a (free) file on you and wait for the call.  Ideally that change of command will never need to happen, but walk through the exercise now.  (It'll also save your children from working themselves up to initiate that awkward conversation with you.)  Either send them the websites/account numbers/logins/passwords, or give them the location of your file with the info, or leave a trail of breadcrumbs-- but tell them what you've done.  Don't just offer vague reassurances or hint about scavenger hunts:  sit them down for a frank conversation with all the gory details.  Don't lock the folder away somewhere "safe"-- make it accessible when they come to your home after visiting you in the ICU (and after traveling all night to get there, and while everyone is exhausted & worried).  Take a hint from the military and pretend that the crisis is going to hit when everyone is already overworked and exhausted.

By the way, your old POA is usually worthless.  Your "durable" POA is not much better than Charmin.  You either need to have a fresh POA on file that you're willing to update every year (and keep in your "Emergency" folder in your file cabinet) or you need to name an alternate trustee on your revocable living trust.  You might also consider opening a joint checking account with a few thousand bucks in it (and the checkbook in your Emergency folder), or gifting your progeny with that amount to use when the time comes.  Between the night I got "the call" and nearly 10 months later when I got the conservator court order, I blew through $10K in legal bills and another $8K in caregiver/travel expenses.  Even after the court order was signed, the fun was just beginning.

It goes without saying that you have a will in that folder, as well as a medical directive and a designated healthcare representative.  And if you're a military veteran then you'd better have a copy of your freakin' DD-214 in there too.

Not that I'm bitter or anything.  But you probably don't want your adult children to feel that way too.

[Workinghard]

Nords, I always appreciate your posts. They're so informative. I need to start a file to save them for future reference!

My parents have AARP as a supplemental insurance and they run into a similar problem with some of the checks being sent to them. My mom spends hours trying to sort it out and it's a big source of frustration.

We're in the process of transitioning my parents finances. It's not easy by any means. My mom is under hospice and has a progressive illness. It's extremely difficult for her to give up control and adjust to my way of doing things. Then there's the glitches. I'll set up online bill pay, online account access, and she'll change the password. She will pay a bill, or thinks she did, and puts it in the checkbook instead of waiting for my weekly bill pay visit. Then I'm trying to sort through what has and hasn't been done.

She also doesn't understand my need to save for retirement and comments they've been just fine. I don't think she fully grasps how much my brother has contributed over the years for the "big" and unexpected expenses as well as a monthly stipend.

My brother has our account information which works for now. As we get older, and our younger son ages, we'll give that info to him since the bulk of our estate will be his. My older son received a size-able inheritance from his dad and said he doesn't need it. However, I am going to gift his 3 children some money for college, or however he chooses to give to them. I would still like to leave him 50-100k, but we'll see how our finances hold up.

As far as the POA, I know the military only does it for a year at a time. Our son thought it was because of a trust/buyers remorse issue and commented if he can't trust his parents who can he trust. I now understand otherwise.

[lizzzi]

The durable POA is a godsend when you need it, though. Most people "get it" that they should have a will, but don't stop to think that if they become unable to manage their affairs through a long, chronic, health issue like Alzheimers or becoming comatose for some reason, no one can pay their bills, handle their taxes, sell their house, etc., etc.--without that durable power of attorney. Naturally it should only be given to someone you trust--and who knows your wishes very well--and it can always be revoked if the POA person turns out to be unworthy of trust. Thanks to everybody who posted on this thread--it has been beyond helpful.