Medicare, Medicare Advantage, and Medicare Supplements in 2021: Changes to Expect for The Year

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Each year, the Centers for Medicare and Medicaid Services (CMS) revises its guidelines for coverage to make way for inflation and the changing demands of the times. That said, seeing changes to how much is covered for a certain healthcare services (or if that something is still even going to be included at all) shouldn’t be much of a surprise. Still, we need to keep ourselves updated of such shifts so that we know what our entitlements are for the year. Typically, the changes would involve the cost of premiums, level of coverage, and deductible and coinsurance amounts.  Here’s what’s new for Medicare, Medicare Advantage, and Medicare Supplements for 2021. 

Standard Medicare Premiums

In 2021, standard monthly premiums for Medicare part B (medical) will increase by $3.90. This is good news, especially that the CMS predicted a more or less $50 per month rise in consideration of the unexpected expenses when the pandemic broke out. Fortunately, the US Congress decided to help and offset the projected increase, finally placing 2021 premiums at $148.50 monthly, instead of the nearly $200 originally planned. 

Medicare Part A premiums are also rising to $471 in 2021, though many citizens actually quality for premium-free coverage. Most people do not need to pay for Part A because they already paid the Medicare tax during their working years (those who worked more than 40 quarters). Those who paid 30 to 39 quarters in tax will need to shell out $259 per month for Part A in 2021(up by $7 from $252 in 2020), while those who have not paid a minimum of 30 quarters will be billed $471 monthly (from $458 in 2020).

Medicare Deductibles 2021

The deductible amount for Part A will rise by $76 to $1,484 in 2021, while the monthly Part B deductible will be up by only $5 to $203. 

Medicare and Acupuncture

Good news for those who undergo alternative health treatments: Medicare now covers up to 12 acupuncture visits within a 90-day period for people who suffer from chronic low back pain only. Medicare defines chronic low back as follows:

  1. Pain that lasts over 12 weeks
  2. Pain that has no known cause (not related to an infectious disease, inflammatory condition, or cancer that has spread)
  3. Pain that’s not related to pregnancy or surgery

If you show improvement, Medicare will cover an additional eight sessions. However, if your physician says that your ailment is getting worse or isn’t showing signs of improvement, then there will no extension of coverage. The maximum number of acupuncture treatments you can get in a year will be 20. 

Medicare Advantage 2021: Lower Fees and More Choices

The CMS announced that Medicare enrollees will have more than 4,800 Advantage policies to choose from during the 2021 open enrollment period—which takes place from Oct 15 to Dec 7 annually. OEP is the time when beneficiaries are allowed to make changes to their current coverages for the next year. Additionally, the prices for monthly Medicare Advantage premiums have been adjusted to a historic low. For 2021, they are generally expected to drop by $21 across the country (the lowest since 2007).

Aside from huge price drops for Advantage plans, Medicare is also now offering more extensive telehealth services (in response to the changing needs due to the global pandemic). Telehealth benefits enable beneficiaries to obtain services that generally occur in person (like consultations with a health care provider or doctor) using real-time video and audio technology. This doesn’t just apply to general healthcare consults but also include specific areas such as cardiology dermatology, and psychiatry among others. Other similar channels that Medicare now recognizes are online services, like virtual check-ins and e-visits. 

ESRD Needs and Insulin Coverage

Patients who have been diagnosed with End-Stage Renal Disease (ESRD) can also join an Advantage plan during Annual Election Period. Policy coverages will begin on January 1, 2021. 

Also, if you are part of Medicare plan that takes part in the Part D Senior Savings Model, you can save on out-of-pocket expenses for insulin in 2021. This model is available to everybody who has Medicare. Plans that are part of it will offer a range of coverage options that include different types of insulin at a maximum copayment of $35 for a 30-day supply. Those who enroll in a partner plan can save as much as $446 annually. 

Medicare Supplement (Medigap) 2021

As of January 1, 2020, all Medicare Supplement plans sold to new Medicare enrollees can no longer cover the Part B deductible. In response to this, Plans C and F will not be sold to new enrollees from the said date. This remains unchanged in 2021. 

One other change to Medigap in 2021 is on the Plans F and G, which both offer high deductible versions, HDF and HDG. For the year 2021, the deductible amount will go up $30 to $2,370. Once you hit the deductible amount, your policy will cover any expenses for Medicare-approved services.

Bottom Line on Medicare in 2021

With the many changes happening to Medicare in 2021, the Medicare Annual Election Period becomes even more important as it gives you a chance to review your existing coverage and see if you need to make any changes for the next year. If you are currently on Medicare it’s imperative that you review these choices with a qualified Medicare insurance broker like those here at SecureCare65 annually. 

We Can Help with your Medicare Questions.

If you need more information and guidance related to the 2021 Medicare changes, our team of Medicare specialists can help give you a clearer picture. Don’t hesitate to get in touch with us at 800-354-1078.

What Does Medicare NOT Cover? 7 Services Not Included in Your Coverage

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While Medicare is designed to help retirees and persons with disabilities cope with the rising cost of healthcare, it cannot cover everything. Some might have the misconception that having Medicare will result in zero billing, but that’s far from the reality. It’s true that the program covers plenty, but this is still not enough. If you are counting on Medicare to shoulder all your possible medical emergencies, then you’ll eventually find yourself with a huge problem when such a time comes. 

With that said, you need to know what Medicare does NOT cover so that you can prepare a contingency plan. 

Medicare Part A and Part B

Traditional Medicare (AKA Medicare A and B or Original Medicare) pays for a huge part of your medical expenses after retirement (65 years old). Part A is equivalent to hospital insurance and will help shoulder skilled nursing care facility stays, inpatient hospital stays, hospice care, surgery and some types of home health care. Meanwhile, Part B, which is equivalent to medical insurance, will help pay for outpatient care, doctor’s appointments, some preventive care services and supplies. You can obtain the services of any hospital or doctor that takes Medicare anywhere in the United States.

So you probably already the details on what Medicare covers; are you aware of what it does not? Here we talk about the seven common medical products and services not included in your plan. 

1. Dental Care

Original Medicare will not provide coverage for teeth cleanings, dentures, fillings, routine dentist visits and most types of tooth extractions. When you sign up for Medicare Advantage, you might get basic coverage for x-rays and simple cleanings, but these usually have an annual limit. To make sure that you are prepared for your dental health needs, you can purchase a separate dental discount policy or dental insurance plan.

Note that Medicare only shoulders treatments that are “medically necessary,” as with a root canal that might need to be done prior to a heart surgery. Plus, dental services typically cost hundreds and thousands of dollars, too, so having a dental insurance policy might be a good option. Otherwise, you can search your location for dental schools that might be willing to provide discounted rates for certain services. 

2. Vision Care

If you need glasses, contact lenses or even just an eye exam, know that Medicare will not help you pay for routine services. As with dental, vision care products and services can be costly, so preparation is key. On the upside, you can purchase contacts or eyeglasses cheaper online, but the payment won’t be from Medicare. 

3. Hearing Aids

Hearing aids typically cost thousands of dollars—and some advanced auditory gadgets can cost as much as $10,000. Unfortunately, Medicare does not cover any of these, nor the exam required to be fitted for any accessory. If this is a huge concern, then you might want to consider Medicare Advantage instead as some plans offer coverage for exams and certain types of hearing aids. 

4. Long-term Care 

Long-term care, usually in a nursing home setting, can cost thousands of dollars every month, so if you’re not ready for this expense, it could eat into your retirement savings (granted that you have one). Although Medicare does cover some services under skilled nursing care, it will not shoulder the costs related to simply getting old or sick and then needing assistance with ADL (activity of daily living) routines. These custodial care needs might include dressing, bathing and other usual self-care activities that you can no longer perform on your own. 

That said, it would be wise to begin preparing for this possible expense while you’re young. However, if you’ve already left the workforce or are already nearing the retirement age, then you might want to consider getting another insurance policy that covers long-term care. 

5. Alternative Care

Medicare does not provide assistance for alternative treatments, like acupuncture or chiropractic procedures. If you need such services to manage your aches and pains or to maintain good health in general, expect to shell out for these yourself. Some Medicare Advantage and Medicare Supplement (Medigap) policies offer limited coverage for certain kinds of alternative therapies, so be sure to discuss these with your chosen provider. Some alternative health clinics also offer discounts based on age, so be on the lookout for these, as well. 

6. Cosmetic Surgery

To reiterate, Medicare covers only those that a medically necessary, so enhancements are definitely out of the picture. What it can cover, however, are those that are needed either to improve the function of the area that requires surgery or to address an accidental injury (depending on the evaluation). It also provides assistance for breast prosthetics/breast reconstruction following from a breast cancer-related mastectomy. 

7. Prescription Drugs

Outpatient prescription medications are not covered, though you can purchase a separate prescription-drug plan (Medicare Part D) or a Medicare Advantage policy (Part C) separately. You can enroll in either when you have Part A and Part B or when your other drug coverage lapses (usually private). 

Another important thing to note about Medicare coverage is that it will only shoulder your expenses from services and procedures performed inside the United States. If you receive care while traveling outside the country, that will unfortunately be an out-of-pocket expense—UNLESS, you have a Medicare Supplement plan (C, G, M, N) which can coverage as much as 80 percent of the cost of emergency medical needs abroad (lifetime cap of $50,000). 

Medicare Supplements are paid in addition to your Original Medicare policy, and it is strongly advised that you enroll in one when you are first eligible to ensure approval and get the lowest price available. 

To learn more about what Medicare can and cannot do for you, or if you’re curious about what benefits Medicare Supplement plans bring, get in touch with us at 800-354-1078. Our team of Medicare specialists are always ready to answer your questions and provide the guidance you need in making the right policy decisions for retirement.

Medicare Supplement Plans: Do They Make Sense and Are They Really Worth It?

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People have differing opinions about Medicare supplement policies—how do you decide which one really need and if it’s even worth the investment?

Summary:

  • Having Original Medicare is great, but its coverage is limited.
  • You pay an extra monthly premium for this plan—on top of what you are already paying for your Original Medicare Part B coverage.
  • Having a Medicare Supplement plan will help you pay for coinsurance, copayments, and deductibles. 
  • Medicare Supplement policies are sold through private insurance agencies, although their standard coverage is fixed according to federal guidelines.
  • Some Medicare Supplement plans also cover healthcare expenses incurred when you travel outside of the U.S.

Being enrolled in a Medicare plan does not mean that you are totally free from any medical expense. In fact, while Original Medicare does cover a large chunk of your health-related costs, being a government product, it simply cannot shoulder everything. Your total bill will be reduced but you will still need to worry about the likes of copayments, deductibles, and coinsurance. This is pretty understandable given that the government’s funding sources are limited.

That said, in order to help ease the burden on its Medicare beneficiaries, the government created a set of standardized insurance policies—only these will be sold through private companies. In comes Medicare Supplement insurance, also known as Medigap. 

Understanding Medicare Supplement Plans

A Medigap plan is an insurance product that is sold through private insurance companies. Designed as a supplement to Original Medicare, it covers certain healthcare services and supplies that the former cannot shoulder—or the so-called “gaps.” Note that you can only purchase a Medigap policy if you already are enrolled in Original Medicare Part A and Part B. It also comes with an additional monthly premium.

If you have both Original Medicare and Medigap and then a medical emergency happens, then Medicare will first pay for the items that are covered under its guidelines before Medigap steps in to pay for the rest (depending on the plan that you are enrolled in). There are several types of Medicare Supplement policies (letters A, B, C, D, F, G, K, L, M, N), with levels of coverage ranging from basic to comprehensive, and their corresponding monthly premiums rise alongside the expanded coverage. 

Another important item to note is that because Medigap policies are government-regulated, their basic coverage will be the same no matter where you are in the United States. Although some insurance agencies have add-ons to their programs, more likely than not price will be the only difference between policies of the same letter sold by various companies. Hence, if you are shopping around for the best Medigap policy for you, it’s best if you compare the offerings of different insurers first before making a decision. 

Basic Inclusions of a Medigap Plan

Regardless of the policy letter you are enrolled in, these are the minimum inclusions of a Medicare Supplement policy. The main difference between the programs is the percentage of coverage (0, 50%, 75%, 100%).

  • Medicare Part A coinsurance and hospital expenses (up to an extra 365 days after the Medicare benefits are exhausted)
  • Medicare Part B coinsurance/copayment
  • Part A hospice care coinsurance/copayment
  • Part A deductible
  • Part B deductible
  • First 3 pints of blood
  • Skilled nursing facility care coinsurance
  • Part B excess charges
  • Foreign travel emergency (up to plan limits)

NOT included in any Medigap plan are: vision and dental care, long-term care (as with a nursing home), hearing eyes, eyeglasses, and private-duty nursing. If you wish to obtain coverage for these, then you will have to speak to your private insurance provider if these can be purchased as add-ons or if they have other independent policies that you can also subscribe to. 

Medicare Supplement Insurance Pricing

As mentioned earlier, price is the primary difference between the Medigap plans offered by different agencies. However, while you cannot control how private companies set their monthly premium rates, you can find out HOW they price their Medicare Supplement policies so you aren’t met with surprise bills in the future. Insurance agencies determine their prices based on any of these three methods. 

1. Community-rated (no-age-rated)

Monthly premiums are not based on your age and everyone who applies will be charged the same regardless of age or gender. Premiums can go up in the future due to inflation issues, but never because of age.

2. Attained-age-rated

Prices are based on your current age, so younger buyers will have an advantage of lower rates. However, the fees can go up as you get older and it could more expensive in the long run. This is a good option, however, for those who do not have enough money now to pay for a plan. 

3. Issue-age-rated (entry-age-rated)

This pricing structure is based on the age you are when you purchase your Medigap plan—and this won’t change as you get older. 

Other factors that can affect the pricing of Medigap premiums include your location, smoking history, health history, and if your provider thinks that you should be subjected to a medical underwriting and screening process. As of 2020, rates for Medicare Supplement plans range from $50 to $1,130. 

Is Medigap Worth Your Money?

Because Medigap policies come with an additional cost, it’s only fair that you ask whether it’s truly worth the investment. In making this decision, you can start by considering your current typical out-of-pocket health-related expenses. 

If you are relatively healthy, have a good prognosis, and are not subject to any maintenance meds or procedures, then you might want to start with the lowest-cost Medigap plan or maybe delay purchasing it. However, if you need recurring care for a chronic illness or are concerned that an emergency might happen in the near future, then it’s wise to enroll in a comprehensive plan. Otherwise, all the money you had saved up for retirement will only go towards your medical expenses. 

That said, shouldn’t you be using your retirement funds to actually relax and enjoy? Such considered, having a Medigap plan can definitely be a worthy investment. 

Medicare Advantage vs Medigap

A Medicare Advantage Plan (also popularly known as a PPO or HMO) is different from Medigap policy. If you currently have a Medicare Advantage plan but want to return to Original Medicare, then you may apply for Medigap insurance shortly before your HMO coverage ends. As long as you have the intention of leaving your Advantage plan, you can start applying for Medicare Supplement coverage. [Note: it is illegal for an insurance provider to sell you a Medigap plan unless you are definitely switching back to Medicare.]

That said, to ensure that enjoy continuous coverage and there are no empty gaps during the transition, you can ask your insurance provider to have your Medigap policy begin when your Medicare Advantage ends.

Note that most Medicare Advantage policies cover prescription drugs, which Original Medicare does not. Some also even shoulder the cost of eyeglasses and hearing aids. If these are important to you and you’re not leaving your HMO provider (employer) anytime soon, then it would be wise to stay. 

Conversely, if you are in a Medigap plan and want to switch to Advantage, then you will need to cancel your policy first before you can proceed. Further, if you find that you don’t like Medicare Advantage after enrolling, federal law gives you the right to return to Original Medicare within 12 months from purchasing.

When to Buy a Medicare Supplement Plan

The best time to buy any of the Medigap plans is during your six-month Open Enrollment Period. This is the half-year window when you turn 65 years old wherein you can purchase any Medicare Supplement plan available in your location and not be rejected for any reason (even if you have a pre-existing health condition). This period begins on the first day of the month that you turn 65. 

If you do nothing during this time and forego enrollment, you run the risk of getting rejected for a plan or being asked to pay a higher monthly fee than the standard rate. You might also be required to undergo medical underwriting. Check the guidelines governing OEP in your state, as some locations may have additional conditions and privileges. 

To know more about which Medicare Supplement plan is the best option for you and how you can find the right insurance provider that will cater to your needs (and budget), you may get in touch with our team of Medicare experts who will gladly guide you through the entire evaluation and selection process. 

Still unsure if Medigap is worth your money? Give us a call at 800-354-1078 so we can provide the information you need to make a sound decision. Understanding the ins and out of the Medicare and Medigap world can be quite confusing, especially if this is your first time hearing about this or feel overwhelmed with information. We are here to help you with your next steps.