In this week’s column, Phil Moeller, the author of Get What’s Yours for Medicare: Maximize Your Coverage, Minimize Your Costs and co-author of the updated edition of How to Get What’s Yours: The Revised Secrets to Maxing Out Your Social Security, clarifies the benefits and disadvantages associated with Medicare Advantage and Medigap coverage.
Is Medicare Advantage or Medicare Supplement (Medigap) better as I age?
Question: My husband and I are in the financial services industry and we purchase both your books (Medicare and Social Security) in bulk and send them to our clients as they are getting to that magic age. Amazon loves us!
Now it’s our turn; my husband turned 65 this month so I know he has to enroll soon. He will not collect Social Security for many years but has to sign up for Medicare as you know.
I am fairly confident we are going to go with original Medicare and a Medigap supplement plan rather than Medicare Advantage. We are not concerned about copays and normal expenses, but we do want to make sure we are covered for the “big stuff” that can come as we age.
I’d like to clarify that this understanding is correct: With Medigap we cannot be turned down as long as we apply within the allowed time frame after signing up for Parts A and B of Medicare, and our Medigap policy can’t exclude pre-existing conditions?
I also understand that there are no network or out-of-network issues and that any doctor accepting Medicare will accept the Medigap.
My biggest concern with Medicare Advantage is that even if we find a plan that accepts all of our doctors now, they can change that at any time in the future. We want to be able to go to the providers we choose.
If we go Medicare Advantage and then some of our providers are dropped, I know that we could then apply to switch to Medigap, but they are not required to accept us and, even if they do, they may not cover any preexisting health conditions. Am I correct?
Any clarification you can provide would be very much appreciated. I’m not sure how anyone navigates this process without reading your book!
Answer: Well, first off, thank you so much for buying my books. I might come back to you for a testimonial request.
Thank you also for being such a careful reader. Your understanding is spot on and represents the classic reason for getting Medigap.
And while you didn’t ask, as a “good reader” bonus, I will tell you that I am a fan of letter G plans now that C and F plans will be no longer be sold to new Medicare enrollees beginning in 2020.
Lastly, I assume the reason you’re getting Medicare at age 65 is either because you’ll no longer be working or that your shop has a small employer health plan that requires Medicare at 65.
If that’s not the case, perhaps you won’t need Medicare so soon.
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Sandi: I really appreciate your response. I was under the understanding that a person had to sign up during the seven month period beginning three months prior to their 65th birthday, their birthday month, and three months after, and that we also had to sign up for Medigap within six months of signing up for A and B to be accepted and have pre-existing conditions covered. Do we only have to sign up for A during that time and B later, then Medigap within a certain time period after getting B?
Our investment business provides a medical plan, but it costs us nearly $2,000 a month in premiums. Because of that, I thought it would probably make more sense to go Medicare and Medigap.
You can certainly use me for a testimonial at any time!
Phil: Your husband will have a special eight-month enrollment period for Medicare once he drops your business plan. However, to avoid a lapse in coverage, he should apply for Medicare before that private coverage ends.
He can enroll in Part A anytime after turning 65 and it will provide secondary coverage for hospital expenses while his private plan is still in effect.
You’re correct that the six-month Medigap “window” begins with the effective date of his Part B coverage.
Sandi:I have one last question. I finally got around to enrolling online for my husband’s Part A and B.
It’s my understanding that he has to get a Part D plan within that time period as well. But when I tried to enroll in the Part D plan they wanted the number from his Medicare card, which he obviously doesn’t have yet.
Phil: The rules say you have 63 days after getting B to get a Part D plan. You should have his Medicare number well before then.
However, to avoid a lapse in drug coverage, you should call a customer representative with your preferred Part D insurer and make arrangements for coverage to be in place before his business coverage ends.