Annual Medicare Enrollment Period

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This is the Truth Network. Now let's get started with Finishing Well. Well, welcome to Finishing Well, a certified financial planner, Hans Scheil, and today's show, which, you know, may be the most important show you've ever heard in your life if you jump on my first idea here, is annual election period. Because, yes, you know, you might guess since this is Finishing Well, we talk a lot about, you know, how to plan your retirement, that kind of thing, that there is an annual election period. You might have heard of something between the election that we're going to talk about. This is a different kind of election because there is an annual election period, and you really need to take care of this one first and foremost before any other annual election period. It is, you know, which way are you going to head eternally, right? There's an election involved. And, you know, you can take the wide road.

It's kind of hot, right? But a lot of people go in that way. But it doesn't have the eternal consequence.

I mean, it does have eternal consequences versus the other election that's available to you is to actually have life. And maybe you have listened to this show for some time and you're thinking, why do these guys appear to be having so much fun? Where does that joy come from? You know, what is it about these guys? I like this financial show.

I listen to a lot of financial shows, but this one doesn't just seem like these guys are out to get me. And the reason for that is we both made our annual election period, and that election was to turn our lives to Jesus. And see, Jesus said it this way, apart from me, you can do nothing, okay? So the only reason that Finishing Well is a decent show, and we're hoping you like it, is because hopefully, you know, we've prayed and asked God to be part of this show, and as he is present with us, then all of a sudden we can do things that would be fruitful, like, you know, spread love and joy and peace and patience and kindness and goodness and faithfulness, all those things that you would hope during your annual election period that you were getting from your age. Well, it only comes because it takes two to bear fruit.

I don't know if you've ever thought about that, but if you want to have an apple, your apple tree is going to have to be met by a bee somewhere along the way because it takes two to make fruit. And so in our lives, in order to have joy in these kind of things, even self-control, which is sort of a misnomer when you think about it, you've got to have Jesus. I mean, you just do, and it's a pretty simple decision to make that election, I want Jesus, I'm going to ask him to come in, take control of my life, you can do that, and that's the most important election you will ever make. But since we happen to be in this season, it starts out October 15th, am I right? It is, October 15th to December 7th, and we're talking about Medicare. So there is an annual election period that is extremely confusing for many people because just because you're on Medicare does not mean that the annual election period has anything to do with you.

So here's the star of the show, John, I mean, excuse me, Hans Schile, to explain to you, you know, some really, from my standpoint, a very simple flowchart, even though he's going to do that audibly, you know, to take you kind of where you're going down this decision and so that you can make the right election if an election is even something you need to make at this point. If you're not on Medicare yet, when you get to Medicare eligibility, which is 65 for most people, you've got first some decisions to make about Medicare Part A and Part B, which is do I want to go on Medicare now or not? And if you've got, if you're still working and you've got group insurance, maybe not, maybe you'd want to delay Medicare until you actually need it when you're going to be off your group insurance. But even then, you may want to go for it because Medicare is really good coverage once you get on it. So people need to make that decision about A and B, Medicare A and Medicare B at 65.

And so if you're over 65 and you've already made that decision, well, we're not going to spend a lot of time on that. What we're going to say is each year during this period of time, you've got the right to make an election or to make an enrollment decision during the annual election period or annual enrollment period. What that decision is, is do I want to stay on Original Medicare, if that's what you're on now, and I get my claims paid and I get my coverage from the government directly, do I want to stay on that or do I want to consider going on to one of these Medicare Advantage plans, which are Part C plans?

And so you say, well, what are you talking about? Well, the government gives you the option and it's just your election to privatize your Medicare or in other words, to outsource your Medicare so that they don't have to worry about paying your claims. They're just going to send whatever insurance company you pick a check every month, a big check, and they're going to be done with you at least for the year where they're just going to collect their Medicare Part B premium and then they're going to send a check to like Humana or UnitedHealthcare or Aetna or whoever you pick as your Medicare Advantage plan. They're going to send them a check every month and you're now going to get your Medicare benefits directly from that insurance company that you picked.

And you say, well, why would I want to do that? Well, there's a whole bunch of reasons and I'm going to go over those in a sec, but let's just understand the decision. So that's one decision is to have your Medicare outsourced essentially or to move from original Medicare to Medicare Advantage. The other decision is to stay on original Medicare, Medicare A, Medicare B, still have your claims processed just like they've always been processed. When you go to the doctor, as long as he accepts Medicare, you show him your red, white and blue card.

You're on there. The government's going to pay your benefits or pay the doctor. And that what most people that are on original Medicare have is what's called a Medicare supplement or a Medigap policy. And then you buy that separately from a private insurance company. But that's not the whole of your Medicare. That's just a supplement. So you're still on Medicare, original Medicare, and then you have this thing that you pay for every month that fills in the gaps. Most people that have those two are very, very happy. OK, if there's one thing that they're possibly not happy about is the monthly premium that they pay for that Medicare supplement coverage.

OK, those some are thrilled with it, though, because they know it pays so well. But there's many that, you know, that stuff goes up over time and we've got plenty of customers that that becomes a real struggle paying that Medicare supplement premium. So that's not really original Medicare. That's the supplement to original Medicare. But that could be a motivation to go on a Medicare advantage or to go on the Part C plan. So because you can you will be required to dump your Medicare supplements. So if you were paying 150, 175, 200 bucks a month for your supplement and you decide to go on the Medicare Part C route or the Medicare Advantage, you now have all these benefits from Humana or UnitedHealthcare or whatever. And you've got you pay in most cases zero premium for that Medicare Advantage plan with Humana or whatever. So there's zero premium. And in many situations this year, they actually give you a rebate on your Part B premium that comes out of your Social Security check.

So this year, they're in a lot of places. They've thrown in 30, 40 bucks a month that they're giving you in a credit back on your Part B premium. These people really want your business. And what we do is we represent – we're really more than five of them, but let's just say UnitedHealthcare, which is the ARP plan, Humana, Aetna, Cigna, Anthem.

We've got a few others. While you would not want to buy one of these things or allow your Medicare to be outsourced, first and foremost is most of them have networks. So you're now going to play the network game with the doctors where you will need to go to their doctors to get your care. And so if a doctor is out of network, you're going to pay a lot more.

Or if it's an HMO, you can't even go to the doctor that's out of network. So that's a word of caution, but it shouldn't scare you away because the networks have become much better over the last few years. I've been offering this stuff since it started.

And 10 years ago, I was very selective about who I sold this to and how I sold it. Still in that way a little bit, but it's a very good option and a viable option for people. And the main motivation here is the saving of the Medicare Supplement premium. Most of these Medicare Advantage plans include a Part D plan or a drug plan, and that's still at no cost as well.

So you've got a drug plan, and if you've had a separate private Part D plan going along with your Medicare Supplement, you can dump that too. So there's a cost savings here is the big motivator. The other thing is most of them have a little bit of dental coverage, and they've got some vision coverage. They've got hearing, either coverage or discounts for hearing aids. And then most of them have a gym membership option as well where you can go down and join the fitness club or they've already got one joined for you. So don't want to get too much into the details of these things because unfortunately a lot of folks in our industry, you call them up and you want information like I'm giving you, and they just start you over here selling you a Medicare Supplement plan. And you really have no context to put that into, and a lot of people just sign up, and even years later they still are a little unsure of what they have.

So when we get on the back part of the show here, I'm going to go over this kind of grid again, and I'm going to try to put some context into your decision making and then your ongoing coverage so that you'll have a little better understanding of what you have and why you have it. Yeah, one other little side note that I would caution, I think, if I'm right, but you can correct me because I know you know it better than I, is when you turn 65, you do need to make some kind of election because if you choose not to go on Medicare and you don't have health insurance outside of Medicare, then they start arranging these penalties for you. Oh, you're absolutely right. And those will last you the rest of your life. They do.

The penalties never go away. Like an annuity check, except they're the reverse. So actually, I guess, what is it, three months before your 65th birthday, you can go in and you can apply for Medicare. But you better have some good insurance that's not Medicare if you choose not to do that because – Sure. Just understand there's a bunch of regulations around that. So when you're 65, you need to make some elections even if the election is to not buy it, to not get on Medicare. One other little side note is that if you choose Part A and Part B, which you would do on the government's website, but what is not at all clear from their website or from anybody else's discussion, would not have known this in a million years had I not known my good friend Hans, was if you choose to go on Part A and Part B and you choose to get a Medicare supplement, you need to get a Part D because they will start – if you don't get a drug plan, guess what, they start figuring out fines because you didn't go on – Absolutely.

Because you have to have a drug plan. You don't want to mess this stuff up at 65 or shortly thereafter. So there's an election period. I'm sorry. You have to make some decisions as you – Right around your 65th birthday. Right.

It's called the initial enrollment period or initial election period, IEP. So you can tell we're loaded for bear again. So we're coming back on the other side of this. Again, this is brought to you by Cardinal Guide, cardinalguide.com. Hans' book, The Complete Cardinal Guide to Planning for and Living Your Environment, it's all there at cardinalguide.com.

We'll be right back. Hans and I would love to take our show on the road to your church, Sunday school, Christian, or civic room. Here's a chance for you to advance the kingdom through financial resources by leveraging Hans' expertise in qualified charitable contributions, veterans' aid and attendance, IRAs, Social Security, Medicare, and long-term care. Just go to cardinalguide.com and contact Hans to schedule a live recording of Finishing Well at your church, Sunday school, Christian, or civic group. Contact Hans at cardinalguide.com.

That's cardinalguide.com. Welcome back to Finishing Well with certified financial planner, Hans Scheil. Today's show is essentially annual election period. So, yeah, you're going to make some elections annually when it comes to Medicare specifically. And because even if you're 85, right, that this period of time could affect you.

Oh, yeah. A lot of those people are. We have people this year that are well above 80.

I don't know of one personally, but I bet it's there already during the annual run that's in their 90s that have made some elections with us. And they've already been a customer. We're not calling somebody new at that age. But, you know, what I really want to do with the show here, again, and I worked at it in the first part. And then the second part is just to give you some context for decision making. Because you've got to make ongoing decisions about Medicare. This isn't one of those things that you can just get it all set at 65 and then turn your back.

And it's everything's going to be wonderful for the rest of your life. There may be some people like that, but most likely you're going to need to pick a drug plan at 65. And then you're going to probably need to pick another drug plan maybe at 68 or 69 or 70 for a variety of reasons.

You either could be unhappy with the drug benefits or you could be unhappy with the formulary. Just they're not covering your drugs properly. You could be put on some new drugs that this one doesn't cover them as well.

And we could switch you over to another one during the end. There's just a multitude of reasons that you need to look at your drug plan every, you know, once a year. And then the same thing if you're on one of these Part C Medicare Advantage plans that includes a drug plan. It might be that somebody that's been on UnitedHealthcare for the last three years would have some of their problems fixed that they had with UnitedHealthcare by just changing to one of Humana's plans. You were just mentioning a family member that was prescribed a new drug that's very expensive. And she just decided not to get it because it was so expensive on the Part D plan. Well, what we can do is just plug that drug in along with some of the rest of her drugs and just put it in the system and reverse engineer. And it'll tell us the best plan to pay for that drug and, you know, her other things. And we can just switch you over to that just like that simple. There's one other little thing, and I know I hate to keep backing up, but I think it's important because it totally floored me.

I didn't see it coming. If you're still working, right, and you have not taken your Social Security. Now Medicare is far from free, sports fans. And not only is it far from free, you've got to pay it the first three months in advance.

And so it's like, wowzers. What's it, $144.60 a month. They haven't announced.

They always wait until after the election to announce that as an election year. But they haven't announced 2021 yet, but $144.60. I'm just guessing somewhere about $150 a month next year. Right, so, you know, somewhere around $350, you know, you've got.

$450 if you multiply it by three, yeah. You can tell that I'm not an anyone. I'm not a producer or any of this stuff.

It's all right. Yeah, I remember I wrote this like huge check. I thought, wait a minute, I'm on Medicare. Well, you know, you apparently pay it three months in advance.

Sure. And so what you think, you know, is because if you're on Social Security, it just apparently comes out. It comes out of your check, but it's still money. I mean, any way you shake it, you're paying $144.60 a month. Now, they have a program called the Low Income Subsidy for people that have a low income, which you don't qualify for that. But you can get that part be paid for by the government. Then for the affluent people, $144.60 would be a bargain. So if you're a high income person in retirement, you're going to pay way more than $144.60.

We're not going to get into it. That's called Irma. But I'll certainly, anybody that wants to call me and talk to me about Irma, there's things we can do about Irma. So we're talking about the Part B premiums. And what I want to get clear with everybody is I want to give you some context to make good decisions. So if you're on a Medicare Advantage plan, Part C and Part D, I'd like through this show and perhaps even a meeting with you, is just to explain exactly what it is you're on and why you're on it and what your options are. And during this time of year, you could change to another one. That would be one of your options, is you could just say, well, I want to leave that one. You know, as I'm listening to what you're saying, hey, I'm not getting $30 rebate kickback towards my Part B.

Hey, I don't have a hearing plan on mine. You know, there's obviously all sorts of advantages that I want to make sure I'm getting the cash. So you're on original Medicare and a supplement. You can also, during this time of year, you can make an election to go on to a Medicare Advantage plan. You can pick the one.

You've got to do it by December 7th. And then you'll dump your Medicare supplement and dump the premium and dump the Part D plan and the D plan premium. So, you know, this isn't cut and dried for everybody.

It's just you've got this period of time that you can make this election. So if you're on one of these Part C Medicare Advantage, you could switch to another one, or if you totally didn't like it, you can go back to original Medicare. So you can leave that. You can leave your Part C plan. And one of the parts that I think may be a little bit hidden in here that we haven't really discussed when it comes to the difference between Part C or being on original Medicare Part A and Part B is if you're on a Part C plan, the reason why you're not paying any premiums is because you've got deductibles. You've got deductibles and copayments. You've got deductibles and copayments.

And you have a network that you have to go to. Right. But just the deductibles and the copayments are going to kind of be an offset. They're going to be an offset of the savings of the premium. Unless you have a good year, then you're going to be money ahead.

And if you have a real bad year, you're going to be money behind. Sure, you're going to be saving the med-sub premium, but you're going to be paying out more in deductibles and copayments. Isn't that cut and dried, okay? But regardless, as you go through your options, so you could change to another Medicare Advantage plan, or you could go back to original Medicare, and then you would need to buy a supplement. And you would need to qualify for that supplement, too.

So if you're in poor health, we're going to want to get that supplement part taken care of before we make this election. And then you'll also need to purchase a Part D drug plan, and that can be a positive or a negative. It's a positive in the sense that you get to pick your Part D plan, so we can go through all of them that are for sale and pick the best one for you. Whereas on the Medicare Part C plan that includes a Part D, you just get whatever they got. So the positive is you could have some choice. The negative is you're going to have to pay for that. And now you're going to have, you know, it's usually not a lot, 15 bucks a month or so.

Mine's 16. Yeah, it's a premium. So, you know, all of this is not that cut and dried. So there's a situation where somebody's on Medicare Advantage, and we went through their options. Let's take somebody that doesn't even know what those Medicare Advantage things are.

They haven't wanted them in the past, but they want to investigate them. Well, so now what you'll be doing is you're on Medicare Part A and Part B on Original Medicare. And so during this period of time, you can make an election to go to any one of those plans. You don't have to answer any health questions. They'll automatically just move you over there. I mean, we'll do it for you.

And you don't have to go straight to a man or whatever. You guys handle a bunch of stuff. You can call us, and we'll take care of it for you, and we offer all of them. So, you know, we're brokers for all that. And really want to give you this kind of advice before we get into the plans. I mean, that's the thing that I have the hardest time teaching to the people I work with, all this stuff, is they just want to be pitching whatever their policy is.

And I say, wait a minute. What I want to do in my advertising or marketing is I want to be educating the people on what their choices are and giving them some context of what they have and why they have it. And then, once we get them in the right box here, then we can start getting into their individual choices of what company they're going to buy it from and which plan they're going to buy. And another one of my motivations personally to go with the med sub rather than going with the plan C, which would have had no premium, I got that. And I was, you know, and I understood the co-pays and the other.

But one of the things is when you're at turn 65, there's no health questions. You don't have to qualify for the Medicare supplement, right? You automatically get the low-price deal.

We put you on the lowest one. Right. And so, you know, I got the low-price deal until they rate it later on or whatever.

But in other words, if there was a time to set up a Medicare supplement when you turn 65 because you've got… You've got what's called open enrollment. Right. And we represent 40 companies selling that stuff. They all sell exactly the same G plan. You know, you've got Mutual of Omaha, Cigna, Aetna's got about two or three flavors.

And, I mean, you just go down the list. Again, a lot of these companies you've never heard of. But we spreadsheet them. And they're different, which everyone's the strongest in different parts of the country.

We do this all over the United States. The important thing, you know, sure, to get a good premium on that and get them in the right plan, which is typically plan G. What I want to do is I want to get you understanding what you've got and make sure that it, you know, it meets your needs. Right. Because that was the initial deal is like, did I want to work… And I've dealt with networks before. And I don't like being referred to people because they were in the network and they'd really rather refer me to somebody else. But they can't do that because it's my health that's involved. So that concerned me.

Sure. So if I'm on a plan C, I've got to deal with a network issue. I have to deal with payments and copayments, you know, and that kind of stuff. But the thing that flipped me, like, really was I was amazed. You know, I bet in the last year of my dad's life, you know, it might have been $250,000 in the house. It was crazy how much those hospital bills were, you know, and with his Medicare supplement he had at the time. I think we might have paid $20 towards one of the ambulance visits, something. But somebody messed up to create that.

It's literally that good. He paid nothing. He paid nothing. And, you know, the thing is with your dad, he was never even looked at his $350 a month premium until he met me.

And then I said, well, I don't care how old you are. Let's see what you're paying and what you're getting and what the option. I went out and saw him. He had already gotten sick, so he didn't have the options to move, but I still wanted to get some understanding of it. Had I gotten to him before he got sick, I could have cut the $350 a month in half and he would have still had exactly the same thing.

He would have had to pay nothing. So once we get zeroed in that you need a Medicare supplement or you have a Medicare supplement, then I would encourage you to price shop. And you can do that any time of year.

You don't need to do that in the annual election period. Medicare supplement, we do that all year long. And, you know, we've kind of rambled on about Medicare here today, and I know that a lot of our listeners are not at Medicare age yet.

So I hope this helps you, but I also want to point out something. When I called on Robbie's dad, it was about two years ago, maybe going on three years ago, and Robbie was like 62 at the time. So he had an ear toward this Medicare stuff because it was coming, but you were thinking in terms of your dad, and that's why you sent me out there. And those of you that are under 65, and if your parents are still alive or your aunts or uncles, in-laws, people that you really care about, I'm telling you, they can use your business savvy or your clean slate. I bet you if you called them up during this period and you just said, you know, I was listening to this guy on the radio, do you need some help looking into all this stuff with somebody that's unbiased? And, you know, we can get you on the phone, them on the phone, and me on the phone, or one of my associates, and just talk through a few things. You'd be amazed at how much we can help people just explaining to them what they've got. Yeah, because, you know, I know what a help it has been for, you know, two or three of my family, you know, since I began to understand, oh, wow, you're on Medicare Advantage?

You mean, oh, you've got a, you know, understanding part A, part B, part C, part D, and then you get all alphabet soup with the, you know, Medicare supplement letters as well. So cardinalguide.com, you can find me. You know, I don't spend a lot of time blurting out my 800 number and blah, blah, blah, blah.

You can find me pretty easily. You can find me through the Truth Network, you know, Robbie here, Hans Shile, and we do our consulting by phone, and we'd love to be of help to you. Cardinalguide.com, thanks for listening.

Thank you. We hope you enjoyed Finishing Well, brought to you by cardinalguide.com. Visit cardinalguide.com for free downloads of this show or previous shows on topics such as Social Security, Medicare, IRAs, long-term care, life insurance, investments and taxes, as well as Hans' best-selling book, The Complete Cardinal Guide to Planning for and Living in Retirement, and The Workbook. Once again, for dozens of free resources, past shows, or to get Hans' book, go to cardinalguide.com. If you have a question, comment, or suggestion for future shows, click on The Finishing Well radio show on the website and send us a word. Once again, that's cardinalguide.com. Cardinalguide.com. This is the Truth Network.