“My Medicare Plan F supplement is going to cost more than $210 per month next year. I can’t afford it! What should I do?”

Answer: Approaching the third week of this Medicare annual enrollment period, I hear your question frequently. It’s so difficult on a fixed income paying skyrocketing insurance premiums when only receiving a 1.5% Social Security cost of living increase. Some insurance companies are raising premiums by as much as 15%. I see three choices: (a) staying the present course and being “insurance poor;” (b) applying for a less expensive Plan G supplement to see if you satisfy an insurance company with your answers to their medical questions; or (c) replacing your supplement with a Medicare Advantage Health plan.

Plan G supplements are available in the $120 - $140/month price range. But, there’s no guarantee a company will accept you unless you recently enrolled in Part B of Medicare and are at least 65 years old. Otherwise, an insurance company can choose not to enroll you. The only difference in a Plan F supplement and a Plan G is the $185 Part B deductible required with a Plan G.

Many people (more than 40% of the Medicare population) have chosen a Medicare Advantage Health plan. By law, these plans cover everything Medicare covers (and more). But, they require you to pay co-payments and co-insurances when using the plan. My favorite plans require a $0 monthly premium. Most importantly, in my opinion, is that these plans must have a maximum amount that enrollees pay before the insurance company pays 100% of claims for the rest of the calendar year. In our area, these maximum amounts range from $3,300 to $6,700/year.

Look at the arithmetic:

Plan F - $210 x 12 = $2,520/year (no other medical costs) + drug plan

Plan G – ($130 x 12) + $185 deductible = $1.745/year (no other medical costs) + drug plan

Medicare Advantage Health Plan - $0 premium (co-payments and co-insurances required) but with a guaranteed maximum out-of-pocket and usually a drug plan is included.

If you have a Medicare supplement and you’ve never tried a Medicare Advantage Health Plan, you’re guaranteed to be able to return to your supplement within the first trial year if you don’t like the Advantage plan.

Call if I can be of service (479-442-8585). Or, go to my website at www.talkretirement.net for more information. Until next week. Dave