Congratulations! I just retired 2 weeks ago (Turn 65 in June).
I retired from United Health Care where I worked as a data analyst within the Medicare arena.
I am not a Medicare Consultant, but I did learn something over the past 20 years and learned more while navigating my choices and helping several other people navigate their choices.
PLEASE NOTE - I have work experience with Medicare but I am not a licensed broker or consultant and am providing this information as general information and not professional advice.
You will sign up for Medicare Part A and Part B through Social Security.
Now you have to decide which plan you are going to get to cover what traditional Part A and Part B coverage doesn't include. (covers 80% of charges after the annual deductible).
Every County in each State has different offerings at different price points, so you do need to compare what is available where you live, but the good part is that core coverage is dictated by the Federal Government. 5 companies may offer a particular plan, but the core coverage is the same for all 5.
This chart shows the basic differences between the most common plans and compared to traditional (A+B) coverage including Part D prescription medication coverage for the Advantage (usually included) and Gap plans (not included).
Note: Some states have made it illegal for doctors to charge excess fees over Medicare Standard charges which is why I included a banned state and standard state option for Plan N
This chart gives you some standard spending numbers that you can compare based on some tiered medical condition costs.
Some things to keep in mind - You only get the guaranteed age based rates for Plan N and Plan G during your initial enrolment period. If you choose traditional Medicare or an Advantage Plan and then decide to switch to a Gap plan the premiums will be adjusted based on your medical history. You can always change from a Gap Plan (G/N) to an Advantage Plan without a health screening.
This is where you need to evaluate your health history, your family history, your aversion to risk and special circumstances that may alter your numbers (Retired from a job that covers all or part of your insurance premium once retired or low income status. . . )
I have already had a heart attack and cancer and have reached my Out of Pocket Maximum 4 times in the past 10 years and I have some moderate chronic conditions that require monitoring. I assumed 3 years with a major medical issue and 7 years with a moderate chronic condition to make my decision on type of coverage. Plan N w Part D was the best option for me.
I then evaluated the Plan N options using the average published costs for age 65 through 75 and a comparison of the same costs from 5 years ago that I got from my Medicare Consultant.
I compared the options for Mutual of Omaha, United Health Care, Aetna, Humana and the Blues.
Different companies offered Household or Spousal Discounts of 5-12% that did not impact my costs, but did impact some of the people who I assisted with their selection.
For me, Humana had the lowest cost, but it was not a substantial savings over Aetna. Aetna's rates had increased at a slower rate and they have a better rating for both financial stability and customer service than Humana.
My cost is $282.50 per month for Plan A/B - $123 per month for Plan N and $8 per month for Part D coverage for a total of $413 per month. More than I would like to spend, but the most affordable, long term option for me.
One other thing to note: Medicare Consultants do not charge you anything, but they do work on commission. Ethically, they should be finding the best plan for you, but they make a lot more money selling advantage plans than Gap Plans.
The Centers for Medicare & Medicaid Services (CMS) sets the maximum allowable compensation agents can earn for Medicare Advantage and Prescription Drug Plans
Medicare Advantage (Part C)
National Baseline: $694 initial and $347 for renewals.
Connecticut, Pennsylvania, & DC: $781 initial and $391 for renewals.
California & New Jersey: $864 initial and $432 for renewals.
Medicare Part D (PDP)
National Baseline: $114 initial and $57 for renewals.
Medicare Supplement (Medigap)
Commissions: These plans are not regulated by CMS, allowing private insurance carriers to set their own rates. Agents typically earn around 20% to 22% of the annual premium for new policies, with lower renewal commissions (usually for up to 6 years).
My consultant earned $295 + $114 on my plan N and part D ($409 total) Had I bought an advantage plan he would have been paid $781 for the Advantage Plan that includes Part D.
PLEASE NOTE - I have work experience with Medicare but I am not a licensed broker or consultant and am providing this information as general information and not professional advice.
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