What you need to know

Medicare is the government-run health care program primarily for Americans age 65 and older and certain younger people with disabilities. Begun in 1965, it now covers well over 50 million people. Since 2003, Medicare has expanded its reach by offering prescription drug coverage (Part D).

While it’s intended to protect retirees from the high cost of health care, one of the most important things to remember about Medicare is that it is not free and does not cover all health care costs. Like other insurance programs, Medicare can leave deductibles and other “cost sharing” for you to pay. Plus, there are some services –dental, vision, recovery and more — Medicare just does not cover. Some services may only be covered in certain settings or for patients with specific conditions.

Get the rates. All the rates.

See a listing of all Medicare Supplement companies in your area, including their rates.

You have choices

Medicare lets you choose the way you’ll receive your benefits. You can select “Original Medicare,” the government-run program, or join a Medicare Advantage Plan, part of a program run by private companies.


Original Medicare is a traditional indemnity-type plan, with deductibles, coinsurance, and copays, but no physician network.


The two parts of Original Medicare are:


Part A: Hospital Insurance. It is usually recommended that everyone join part A when they turn 65 (after all there is no premium). The deductible is now $1,288.00 per benefit period (beginning the day you’re admitted as an inpatient in a hospital; ending when you haven’t received any inpatient hospital care for 60 days in a row). In 2017 it will be 1,316.00. Coinsurance kicks in for some longer hospital stays.


Part B: Medical and physician insurance. The current Part B premium is 104.90. The standard premium for 2017 will be $134.00 for those already on Medicare. Part B requires you to pay 20% coinsurance on your covered medical bills. So, for instance, a $10,000 bill could cost you $2,000!


Since Original Medicare can cost you a lot out of pocket, it may be important to have something else to help you pay. That’s where Medicare Supplement Insurance comes in.

If you’ve become comfortable with a group health plan from your employer, you may want to choose a plan that’s more like it than original Medicare.


These are Medicare Advantage plans (Medicare Part C). These are offered and run by private companies and cover everything required by Medicare. They may also include some “extras” that Original Medicare does not (vision benefits, for instance).


Often referred to as “all-in-one” plans the Advantage plans put together all the Medicare parts, maybe including Part D, prescription drug coverage. These plans may take the form of HMOs, PPOs (preferred provider organizations), and fee-for-service plans.


You should know this about Medicare Advantage plans: They may include provider networks, so your current providers may not be part of the network. Referrals may be needed. You cannot have a Medicare Supplement at the same time as Medicare Advantage, but many of our clients purchase advantage plan benefits to cover some of the gaps. Talk to your Adviser for details.


Contact your Cornerstone adviser to learn all about Medicare Advantage.

Important companions to Original Medicare

This is all about filling the famous “gaps” in Medicare.  Medicare Supplement Insurance (Medigap) can help do just that.


Offered by private insurance companies, Medicare Supplements work by paying some of the costs that Medicare will not. So if, for instance, doctor (Part B) coinsurance and deductibles leave you owing $5,000 out of pocket, your supplement can help pay that.


Supplements are standardized into 10 plans by the government — A through N. No matter which insurance company you choose, the plans are the same. The difference is in the cost. Companies can charge what they want.


At Cornerstone we help you identify the plan that’s right for you and the cost that’s right for your budget.


We’ve all heard about the skyrocketing costs of prescription drugs. Medicare Part D was started to lighten that burden for retirees.


Like supplements and Medicare Advantage plans, Part D plans are offered through private insurance companies. They can also be a part of Medicare Advantage plans.


Companies offering Medicare Part D plans can change their list of covered drugs (formulary) from year to year. So it makes sense to make sure any drugs you currently take or may take in the future are included in the formulary of any part D plan you are considering.


Here are some special periods for joining (or leaving) Medicare programs. Note that if you are receiving Social Security or Railroad Retirement Board, you are automatically enrolled in Medicare on your 65th birthday.


Initial Open Enrollment

You have your own Open Enrollment Period right around your 65th birthday.


You can join Original Medicare and a Part D plan, or a Medicare Advantage Plan during the three months before your birth month, your birth month, and 3 months after your birth month.


Here’s something important: During this period, you have guaranteed acceptance for the Medicare Supplement Plan of your choice.  This may not be true later on.


General Election Period
If you miss your Initial Enrollment Period, you can enroll between January 1 through March 31 each year. A late fee may be required.


Annual Election Period
Everyone has the chance to make changes to their coverage every year during open enrollment. This generally occurs from October 15 to December 7.


Special Enrollment period
If you or your spouse are still working, you can have a special period when your coverage ends.


Medicare Advantage Disenrollment Period
From January 1 through February 14 you can switch from a Medicare Advantage Plan to Original Medicare.

Big question: does Medicare cover Long Term Care?


The answer is mixed.


No, Medicare does not cover unskilled nursing care that primarily involves helping with daily functions such as bathing and eating.


It does cover skilled nursing care, with medical care provided by professional staff. There are limits to how long Medicare will cover this service and substantial pre-requisites that must be met.


According to reports, as many as 65% of Americans turning age 65 will need Long Term Care and the cost of staying in a nursing home (semi-private room) can be as much as $80.000 per year.


To protect against these costs, please talk to us about affordable Long-Term-Care Insurance and Short Term Recovery Cash options.