Social SecurityMedicare Potpourri

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Social Security/MedicarePotpourri

• C. Crispin Sargent
• CS AdvoCare, Inc.
• 9725 E. Hampden Ave., Suite 102
• Denver, CO 80231
• 303-755-1845
• Email ccrispin_at_earthlink.net

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Social Security

• Social Security
• Retire before age 65
• Retire at age 65
• Retire after age 65
• Full retirement in 2006
• Age 65 8 months

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Earnings 2006

• Age 62 65 12,480.00
• Withhold 1 for every 2 earnings
• Age 65 Full Retirement 33,240.00
• Withhold 1 for every 3 earnings
• No Offset after Full Retirement
• 2006 Age 65 8 months is Full Retirement

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Medicare

• Medicare Eligibility
• Initial Enrollment Period (IEP)
• 1st of the month that you turn 65
• Special Enrollment Period (SEP)
• 1st of the month following retirement
• General Enrollment Period (GEP)
• January through March
• Effective Date July 1st
• Premium Penalty of 10 for each year you should
  have been enrolled in Medicare.

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COBRA Eligibility

• Termination/Retirement
• 18 months
• Second Qualifier
• Eligibility for Medicare
• Death of Employee
• Divorce
• Additional 18 months

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When Do You Want/Need To Take COBRA

• Retire before age 65
• Spouse is
• Caution Special Enrollment Period is only
  available for retiree that is actively at work at
  time of retirement.

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Medicare Background

• Medicare Parts A and B became law in 1965
• Part A Hospital coverage
• Pay no premium for coverage
• Pay 393.00 per month if not covered under SSA.
• Part B Medical Coverage
• Current premium 88.50 per month
• Provides no coverage for outpatient prescriptions
• Medicare Part C Medicare Choice Now called
  Medicare Advantage
• Introduced under Clintons Balanced Budget Act in
  1997

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Medicare Background

• Medicare Part D Medicare Prescription Drug Plan
• Introduced in 2003 under the Medicare
  Prescription Drug, Improvement and Modernization
  Act
• Plan has two parts
• a two year voluntary prescription drug discount
  program (2004 2005) and
• second, a standard drug benefit to begin in 2006

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Medicare Modernization Act
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Medicare Drug Insurance ProgramMedicare Part D

• Begins January 1, 2006
• Enrollment November 15, 2005 to May 15, 2006
• Penalty for late enrollment
• 1 per month unless creditable coverage thru
  employer plan
• Premiums will average 28 per month.

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2006 Medicare Plan Deductibles and Coinsurance
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Who is Affected?

• All Medicare Beneficiaries
• 43.1 M Medicare beneficiaries / 29.3 M expected
  to enroll
• 476,000 Colorado Medicare beneficiaries
• 60,000 Colorado dual-eligible beneficiaries (have
  both Medicare and Medicaid)

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Who is Affected?

• 100,000 Colorado low income beneficiaries who may
  qualify for subsidies
• 60,000 Colorado Medicare beneficiaries under age
  65
• There are two groups of low income
  beneficiaries.
• 150 poverty level - 14,355 individual/19.245
  couple
• Assets less than 10,000/20,000
• 135 poverty level - 12,924 individual/17.316
  couple
• Assets less than 6,000/9,000

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Do You Qualify?Who is Eligible
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Do You Qualify?What You Get
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Things To Think About

• You do not need a PDP
• IF you have prescription coverage through a
  retiree plan, PERA, or State or Federal retiree
  plans.
• IF you have VA or TriCare prescription coverage.

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Things To Think About

• You do not need a PDP
• IF you have coverage under an existing Medicare
  Advantage Plan (Kaiser, Secure Horizons, Rocky
  Mountain HMO.)

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Things To Think About

• IF you have prescription coverage through a
  Medicare supplement (plans H, I, or J), you may
  want to consider a Part D plan. You will need to
  either decrease your Medicare supplement to plans
  A-G or carve-out the prescription benefit from
  your current plan. Premiums will be reduced.
• IF you do not currently have prescription
  coverage with your Medicare supplement, you may
  want to sign up for a Part D plan.

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Original Medicare Beneficiaries Will Have

• Medicare Part A
• Medicare Part B
• Medicare Supplement
• Prescription Drug Plan (PDP)
• Stand alone
• There will be about 18 companies approved to
  provide coverage

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Medicare Supplements
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Medi-Gap Policies
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Medicare Advantage Beneficiaries Will Have

• Kaiser
• Secure Horizons
• Rocky Mountain HMO
• There will be new Medicare Advantage Plans
• Colorado Access
• Denver Health Medical Plan
• Fidelis Securecare
• Humana
• United Healthcare

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Medicare Basic Prescription Drug Benefit
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Medicare Basic Prescription Drug Benefit

• Plans may not actually follow the basic
  prescription drug benefit formula.
• They must just be actuarially equivalent.

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Pit Falls

• Formulary
• Pre-Authorization Requirement
• Quantity Limits
• Step Therapy

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Why Bother

• Medicare beneficiaries not covered under an
  employer sponsored plan, TriCare, or a government
  sponsored plan, are subject to cost shifting and
  pay the highest price for prescriptions.
• Low income beneficiaries have no access to cost
  reduction.
• Medicare supplement plans have limited benefits
  that result in dollar trading.
• Prescription plans need government subsidies in
  order to provide meaningful benefits.

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Retiree Plans

• And
• Tax subsidies are given to employers to encourage
  them to maintain drug coverage for retirees.

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What Do The Advisors Need To Do

• Ask about current coverage
• Why?
• To determine if any action is required.
• If action is required, then determine type of
  coverage desired.
• Original Medicare Model
• Medicare Advantage Model

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Beneficiaries Will Do One of Four Things

• Nothing
• Change to Medicare Advantage
• Purchase PDP (Prescription Drug Plan) recommended
  or affiliated with Medicare Supplement Plan
• Purchase PDP (Prescription Drug Plan) after
  reviewing plan options for best coverage

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What You Need to Compare PDP Plans

• Medicare Number
• Last Name
• Date of Birth
• Effective Date for Medicare Part A or Part B
• Zip Code
• Name and address of preferred pharmacy
• List of drugs
• Name of Drug
• Dosage
• Quantity for 30 day supply

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Where do you get more information

• CS AdvoCare 303-755-1845
• State Health Insurance Assistance Program (SHIP)
  1-800-633-4227
• Centura Health Insurance Counseling for Seniors.
  1-800-544-9181 or 303-899-5151
• www.coloradomedicare.com
• www.medicare.gov 1-800-633-4227
• www.socialsecurity.gov 1-800-772-1213
• /retire2/retirechart.htm
• /retire2/delayret.htm
• www.benefitscheckup.org