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Now is the Time to Review Medicare Plans

By Mike Chaney
Commissioner of Insurance And state Fire Marshal

Although we donít like to admit it, all of us are getting older. And our stateís population is getting older every year. In fact, in January, experts say the first wave of Baby Boomers will begin turning 65.

And, although we all might like to ignore the turning of the calendar, we canít. And one of the most important things we canít afford to ignore is Medicare. While we might not want to think about it, itís vitally important that our aging citizens understand Medicare and when and what to do about it.

If youíre among the population that is closing in on retirement age, there are some decisions you have to make about your health care, and if you make the wrong decisions, or just ignore them, you may be setting yourself up for some unnecessary expenses in your retirement years.

Itís important to note that Social Security has raised the retirement age to 66, but Medicare eligibility still begins at 65. That is an important distinction. It is very important that you sign up for Medicare at age 65, even if you are still employed.

Even if you are still working and have health benefits from your employer you need to sign up for Medicare Part A, which covers hospital expenses. And when you sign up is critically important. The enrollment period for Medicare Part A is from three months before your 65th birthday, the month your birthday is in and continues for three months after your 65th birthday. But those months are not all the same. If you sign up during the first three months your coverage will start at the beginning of your birthday month. If you wait until your birthday month your coverage wonít start until the beginning of the next month and if you wait for the final three months, you may experience lengthy delays before your coverage begins. So, the rule of thumb is, the earlier the better.

That brings us to Medicare Part B, which is one of the most costly if you make a mistake. Medicare Part A is free to everyone who has paid Medicare taxes. But Part B, which covers other-than-hospital medical expenses, with the exception of prescription drugs, has a monthly premium of around $100 for most people. But if you donít sign up for Part B when youíre supposed to, there can be a harsh and permanent penalty consisting of 10 percent per year for every year you should have been enrolled but werenít. You should sign up for Part B when you turn 65 or stop working, whichever comes later.

If any of this confuses you, you should check with your benefit manager if youíre still working, confirm the information with Medicare and Social Security and be certain you understand the rules.

Then we come to Part D, the prescription drug benefit. This has different rules but again, a mistake can cost you permanently. Part D is delivered exclusively through private plans with an average premium of around $41 a month. Again you will pay a permanent penalty for late enrollment, but with Part D it is about 1 percent extra per month for every month you should have been enrolled but werenít. Sign up for Part D as soon as you are eligible.

And one last thing; Medicare Open Enrollment, which runs from now through Dec. 31st is currently open and you should take this opportunity to carefully review your policies and benefits. Be sure to check the list of drugs covered, the premium, deductible and cost-sharing you pay and any coverage gap.

Also, beware of door-to-door sales people. Agents of Medicare cannot solicit business at your home without an appointment. Never allow uninvited agents into your home.

Do not give out personal information, Social Security numbers, bank card numbers or credit card numbers to anyone you have not verified as a licensed agent.

Also, verify that the plan you choose is an approved Medicare plan. You can view all of the approved plans at www.medicare.gov or by calling 1-800-633-4227.

Even though you would like to ignore that calendar slipping up on you, you cannot. For a happier retirement, enroll in Medicare in a timely fashion, choose the correct plan and make sure you understand everything it does.

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