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Pros & Cons of Long Term Care Insurance

Long Term Care InsuranceOur brokers at Hyers and Associates specialize in health insurance and can help you sort through what’s best when it comes to traditional long term care policies.

If we only knew what was in our future, decisions would be so much easier.

You don’t want to spend money on something you don’t need. And you don’t want to need it and then be unprepared. Let’s take a look at some of the pros & cons of LTC insurance.

 

The Pros

  1. Peace of mind is the main reasons most people are interested in a traditional long-term care policy. You don’t want to worry about what will happen to you and your loved ones with such a big expense lurking.
  2. No one wants to be a burden on their children, families, friends and loved ones. Many parents would prefer to have long term care insurance cover the costs (and time) associated with prolonger health care needs.
  3. Flexibility in coverage is an advantage for long-term care insurance policies.  For example, you can choose how much coverage you want to have per month, or how long you’d like to be covered.
  4. Start coverage in your 50’s or 60’s. The earlier you start coverage on a long-term care policy, the more likely you’ll be able to pass the required medical underwriting. Once you have been approved the policies are “guaranteed renewable” and cannot be taken away unless you don’t pay your premiums.
  5. For lower rates apply for the insurance when you are younger. Rates can increase as the years go on, however. This is why some of our clients purchase fixed payment hybrid long term care annuity and life insurance plans.
  6. Leaving your spouse with the assets she or he might need and an inheritance to you families. There’s not much that eats up estate like prolonged LTC expenses. Insurance solves that problem and protects your life’s work for the ones you want to provide for.
  7. Most plans include inflation protection. We know that the future cost of care is only going to increase. Have a policy that compounds at 3-5% each year is almost a necessity.

The Cons

  1. Passing medical underwriting can be difficult, especially if you wait too long. Once pre-existing conditions show up, they may keep you from qualifying for the insurance. About 30% of the people that apply for the insurance fail the health assessment and/or receive much higher rates.
  2. There is a long list of health issues that insurance companies use to decline applicants. There’s an even longer list that will cause your rates to be more at onset. Sometimes it’s not just one thing, but the combination of several risk factors.
  3. The cost of long-term care insurance can be prohibitive, especially for those in the middle-income bracket. Rates have been increasing. Long-term care insurance is disappearing for middle-income people as rates are too high. The high risk is causing many insurance companies to stop offering long-term care insurance.
  4. If you qualify for long-term care benefits, there is frequently a period of time before your benefits can begin. This is called a “waiting period’ and it acts like a deductible. Most policies have a 90 day wait, but some are flexible and let you choose the time. Shorter durations usually increase the cost of the policy.
  5. Most policies are capped in how much they will pay out. You get to choose the duration and benefit pool of your policy, however. It is unusual to see plans that pay indefinitely due to cost and risk.
  6. If you do not use the policy, or if you cancel the policy, you and your family may not get any money back. This issue is difficult for many after paying premiums for many years. That’s why hybrid policies have really taken off in the marketplace.

 

For Other LTC Options and Strategies, Call Us!

If you are interested traditional long-term care insurance, we can help you. We can also show you hybrid insurance policies – both life and annuity driven coverage.  Other strategies can include using your Health Savings Account (HSA) or Medicare Medical Savings Account (MSA) to cover your potential long-term needs.

If you are considering a traditional long-term policy or are interested in what other options are available, we’ll be happy to walk you through all your options. Contact us today to learn more.

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Category: Long Term Care Insurance, Retirement Planning

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Get the Facts: Group Health Insurance vs. Individual Health Plans

With the various health insurance options available today, it’s easy to see why people are confused. Basic options include group health, individual health plans and short term coverage. Get the facts about all of your options so you make an educated choice about your health insurance coverage.

group health insuranceWhat is Group Health Insurance?

Companies purchase group health insurance policies for their employees. Much like individual coverage, these plans are purchased by the employer on the open market. Some employers pay for the total cost of group health insurance, but they are only required to pay 50% for the employee only.

It is offered as an added benefit or incentive to employees. Often there will be a waiting period of 1-3 months before the coverage becomes effective. And some businesses require employees pay the total amount for their spouses and dependents in a group plan. Group health insurance can also be offered by professional groups and other organizations as long as they have enough participants to qualify for it.

Businesses will need a minimum of 2 employees to offer coverage and there will be minimum participation requirements depending on the size and scope of the group. Some companies can qualify for lower rates using medically underwritten MEWA plans. Be sure to ask about these innovative plans if you’re under 50 total employees.

What is Individual Health Insurance?

A single person (or family unit) purchases individual health insurance, as opposed to a company, organization, or professional group. It is purchased on the private market or through the federal marketplace. Despite the name, people can purchase this insurance for their families so it covers more than one individual. While one person is purchasing it, all the member of the immediate family can get coverage.

There are few companies offering plans outside of the Federal Exchange, so it’s wise to explore your options with an agent before enrolling. Depending on your income for the current year, some individuals and families will qualify for a tax credit. This can help lower your rates and in some cases your out of pocket exposure as well. In other words, your deductible and coinsurance amounts can decrease based on your projected income for the year.

How Do You Get Coverage in the Meantime?

It may take time to qualify for group health insurance, such as being employed for a certain period at the company. And purchasing individual health insurance may also take time. Plans may not start until the first of the upcoming month.

In the meantime, people can buy short-term health insurance. While the coverage is limited and only available for a brief period, it is better than having no coverage at all. Work with an insurance agent to learn more about short-term health insurance options to see if they are right for you.

In fact, some of our clients are purchasing short term health plans for an entire year now. These plans are growing in popularity because they can be much less expensive than Exchange plans and will cover most catastrophic events. They will not cover preexisting conditions, however – so they aren’t the best fit for everyone.

What Makes These Health Insurance Plans Different?

There are distinct differences between group health insurance and individual health insurance plans. Consider what makes them different:

  • With group health insurance plans, nobody with pre-existing conditions can be denied. And there are no waiting periods to satisfy for any preexisting conditions. By rule, companies must pay for at least 50% of the employees’ premiums only.
  • Individual health plans can cost less than group health insurance – especially for those who qualify for tax credits. You’ll need a Qualify Life Event in order to purchase a plan outside of the yearly Open Enrollment window. Preexisting conditions are also covered with on-exchange plans. You cannot get a tax credit if you’re offered coverage from your employer, however.
  • All group health insurance plans and individual plans include maternity coverage. Short term policies typically will not cover this benefit. It’s wise to ask to make sure.

What About Health Discount Cards?

You’ll also see a lot of advertisements about health discount cards and policies. These programs do not provide actual insurance coverage. Rather, certain services are offered at a discounted rate. And this means people could be left with thousands of dollars in medical bills for an emergency situation.

Discount policies are never a suitable substitute for legitimate health insurance coverage. Sometimes people use them as a supplement to their regular health insurance to offset deductibles and copayments, but you need to be careful with these plans. They can cause more problems than they solve.

Benefits From Selecting Group Health Insurance

Group health insurance is a top choice for most people. There are numerous benefits for people who have this coverage. The biggest difference these days are the networks. Most individual plans will only offer smaller HMO plans, but most group policies are PPOs. If you can get it, you’ll usually benefit from the larger network associated with a PPO. And if an employer pays all or part of the cost of this insurance, it is usually the most affordable and comprehensive option.

Consult with a reputable insurance agent today to learn more about group health insurance, individual health plans, and short-term health insurance. Find out which options are right for you or your business.

Thank you for reading! How can we help you? Contact us today.

 

Category: Group Health Insurance, Health Insurance

2020 Medicare Deductibles & Cost Sharing

It’s the time of year when Medicare announces changes that affect Medicare beneficiaries and the insurance plans they own.  Like most years, the 2020 changes are incremental, but larger than what we saw for 2019.  We will discuss them below and how they will affect your out of pocket exposure.

(It’s important to note that when the officials at CMS (Centers for Medicare and Medicaid Services) make changes, it affects all insurance plans – both new and old.  It doesn’t matter when you purchased your coverage – all plans must abide by any new cost sharing rules.)

2020 Medicare Premiums, Deductibles & Coinsurance

MEDICARE FEATURE
 2019 AMOUNT 2020 AMOUNT $ INCREASE
Medicare Part B Premiums (For Most People) $135.50 $144.60 $9.10
Medicare Part B Premiums (New Enrollees) $135.50 $144.60 $9.10
Part A Deductible (Inpatient Hospital) $1,364 $1,408 $44
Part B Deductible (Physician’s Services) $185 $198 $13
Hospital Coinsurance Days 61-90 $341 $352 $11
Hospital Coinsurance Days 91-150 $682 $704 $22
Skilled Nursing Facility Coinsurance $170.50 $176.00 $5.50
High Deductible Plan F $2,300 $2,340 $40

Medicare Part B Premiums in 2020

2020 Medicare UpdatesMedicare Part B premiums will be increasing for many Medicare beneficiaries in 2020 due to the increase in Social Security monthly payments.

Those who fall under the “hold-harmless” provision, by rule, must have their Part B premiums offset by increases in Social Security payments. Some will have their premiums raised to $144.60 a month while others will see smaller increases based on a sliding scale.

Those who are new to Medicare in 2020 will pay $144.60 per month – a $9.10 increase from 2019. This amount will be more for high income earners. The Income Related Monthly Adjustment Amount (IRMAA) requires individuals making more than $85,000 – and couples filing jointly making over $170,000 – to pay more for Part B coverage. There are four tiers to the IRMAA payment schedule. You can view them here.

Medicare Part A and Part B Deductibles

Most of our clients ask about the Medicare Part B deductible each year. The good news: The Medicare Part B deductible for 2020 is $198 – a $13 increase from 2019. This is an important amount for those who own Medicare supplements not covering the Part B deductible – like Plan G and Plan N.

Plans G and N continue to be some of our most popular policies because of the small Part B deductible. In many cases, the lower premiums with G and N more than make up for the deductible and/or office copay amounts.

Like most years, the Part A deductible (Inpatient Hospital Care) is only increasing slightly to $1,408 – a year over year increase of $44. Most Medicare supplements cover the Part A deductible, so this figure is not quite as important. The most popular policies, Plans F, G and N, all cover this gap.

What is the 2020 Plan G & Plan F High Deductible Amount?

High Deductible Plan F and G are also popular due to their low premiums and known out of pocket exposure. The deductible will only be increasing slightly to $2,340 in 2020. That’s a modest $40 increase from 2019.

Plan F, G and J are the only plans currently offered that come in a high deductible version. Plan J hasn’t been available for many years – and Plan F will only be available for those who were Medicare eligible before 2020.

High Deductible Plan G will be the only plan available for those who are new to Medicare in 2020 and beyond. In many states, HD Plan G will offer the lowest monthly premiums of any Medicare supplement for sale.

Medicare Supplement Plans K and L Maximums

Plans K and L were introduced in 2010 as part of the Medicare Modernization Act. In our minds, these plans most closely resemble Medicare Advantage policies. They have larger out of pocket exposure than more traditional plans like F, G and N. Unlike Medicare Advantage, Plans K and L do not have network restrictions, however.

CMS announced moderate increases for 2020 to the out of pocket maximums for these two unique plans. The out of pocket will be $5,880 for Plan K and $2,940 for Plan L.  We don’t see a lot of interest in these two plans at out agent as others (including many Advantage plans) offer more value when comparing benefits and costs.

Contact Us For Quotes And Assistance

We are a full service, independent insurance agency. We license direct with all of our carriers and can help you enroll (at no additional cost) with the Medicare insurance plan the best fits your needs and budget.

We work with many, many carriers offering Medicare supplement, Medicare Advantage and Part D prescription drug coverage. Contact us today to compare your best options.

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Category: Medicare Advantage, Medicare Supplements

Your Part D Medicare Prescription Coverage

Medicare Part D PlansAt Hyers and Associates, we work with Medicare prescription Part D drug plans every day. Whether it’s Medicare Open Enrollment or your new to Medicare and need a Part D plan to compliment your supplemental insurance, we can help.

Our team works with several different insurance companies and we can help you find a Part D plan that best fits your prescription needs and pharmacy choice. So let’s take a look at what you’ll want to know to get started.

The Basics

Medicare Part D coverage are private policies offered by insurance companies – not the government. You don’t have to sign up for a plan, but you may face a Late Enrollment Penalty later if you miss your Open Enrollment window. This penalty will continue as long as you have the Part D coverage. It is best to sign up for one right away even if you’re jus on a few inexpensive prescriptions. The penalty will add up quick if/when you do enroll later.

Every year the insurance companies submit their plans to Medicare for their approval. All of the insurance companies must meet the requirements of Medicare to qualify as a Part D prescription provider.

If you have prescriptions you are already taking on a regular basis, you’ll want to make sure they are covered by the plan. You can do this yourself using the Medicare Plan Finder Tool, but it might be easier to work us. We do this everyday. There are several ‘tiers’ in the plans which will determine your copay or coinsurance for your particular medications.

You want to factor in the plan’s premiums, deductible amount and copays to see which policy offers you lowest overall costs. And many plans have preferred pharmacies that can lower your costs too – so it’s best to plug in more than one at time.

And you don’t want to assume that the plan you have one year will be the best for the next year. It’s not uncommon for Medicare Part D Drug plans to change significantly year over year.

Do You Have Other Drug Coverage Options?

If you have drug coverage through your employer or a government provider such as the Veterans Administration, Tricare or Indian Health Service, you may not need a Part D plan. These other insurance offerings usually qualify as creditable coverage. It’s best to talk with someone in the know before making any changes to your existing coverage and/or enrolling in a Stand-Alone Part D so that you don’t make any mistakes.

If you are enrolled in a Medicare Advantage (Medicare Part C), and your prescriptions are included in said plan, you don’t enroll in Part D. If you do, you will be dropped from the Medicare Advantage program and returned to original Medicare Part A & B. Some Advantage plans (Medical Savings Accounts and Cost Plans for example )do not offer Part D coverage, however. Again, there’s a lot to know, so make sure you’re getting good advice before acting.

How Much will Part D Prescription Coverage Cost Me?

Medicare Part D Drug CostsThere are several competing plans offered in all states. In most areas, you’ll see 20-30 different plans offered from an array of different insurance companies. Most policies are around $20 a month give or take.

You don’t want to sign up for the plan with the cheapest premiums, however. Your drug copays might be much higher with that plan and wind up costing you more overall.

There’s a bit of a science to choosing the best plan and we can help you decide. You’ll have several individual items to factor into your personal choice.

How Do I Pay for My Part D Prescription Coverage?

You can pay the premiums for your coverage the same as any other insurance premium. You can be billed monthly, or use have the premiums deducted from your bank account or credit card. Alternatively, you can have the premiums deducted directly from your Social Security check.

If you chose the Social Security option, it may take up to 3 months to put that in place. And if you are changing plans, it can take another few months before it’s all squared away – so that may not be the best choice. If that happens the first 3 monthly premiums will be deducted from your third check, and after that, it will be just one month at a time.

Need Help or Information? Call Us!

The Hyers and Associates team members work with the insurance providers for Part D prescription coverage and Medicare Supplement Plans every day. We can help you navigate through the various companies and providers so you’ll make the best choice for your needs. We are here to help, so give us a call.

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Category: Medicare Part D

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2020 Medicare Open Enrollment Options

Medicare Open EnrollmentMedicare Open Enrollment for 2020 effective dates has begun. This window runs from October 15th through December 7th.  All changes to your Medicare Advantage and/or Prescription Drug Part D coverage will take effect January 1, 2020.

Should you miss the Annual Election Period (AEP) open enrollment window, it may not be possible to make changes until this time next year. It’s important to review your coverage and make sure your benefits, costs, copays and network availability are still in-line with your needs.

What Are My Options During The Medicare Open Enrollment Window?

There are several changes you can make to your Medicare coverage during the AEP window.  You can:

  • Switch to a new Part D prescription drug plan
  • Enroll in a new Medicare Advantage Plan
  • Disenroll from a Medicare Advantage Plan and return to Original Medicare
  • Compare and shop for Medicare Supplement Insurance

As you probably know, Medicare is full or rules and timelines. It’s usually a good idea to talk with a knowledgeable agent this time of year. Changing Medicare Advantage plans or enrolling into (or out of) an Advantage plan for the first time can be tricky. You’ll want to make sure you follow the Medicare guidelines so as not to incur penalties and/or delays.

Lowest Priced Part D Prescription Drug Plan For 2020

One of the most common changes this time of year is purchasing a new stand-alone Medicare Part D Drug plan. Medicare drug plans can change dramatically year over year and this year is no exception. You don’t want to assume your premiums, copays and deductibles will be the same. They won’t.

There are some significant changes for 2020 – more so than most years. WellCare has purchased Aetna’s book of business. Aetna has, in-turn, partnered with SilverScript. And Humana has introduced a new Walmart Drug plan. But if you have the old Humana Walmart plan, you will not automatically be mapped into the new one! In fact, you’ll be moved into a different plan with premiums that are twice as high. That change may not work well for a lot of consumers.

This year, more than ever, it’s important to check your options with several major changes happening. You may want to create an account at MyMedicare and plug-in your prescriptions. Or you may want to speak with an experienced agent if you’ve never shopped for a new Part D drug plan before.

There are several new competitively priced Part D plans for 2020. Aetna, Envision, Humana and Wellcare all have plans with inexpensive premiums, robust formularies and low copays on most generic drugs. Your best option may depend on which pharmacy you prefer. Mail order will be a good option with many of these plans as well. Make sure to review your ANOC for (Annual Notice of Changes) and then research all of the new plans for 2020.

There will be other comprehensive low cost plans offered from SilverScript, Anthem BCBS and United Healthcare. But remember you don’t want to shop on premiums alone. Copays are one of the most important factors in determining your best option for 2020. It’s best to shop by lowest overall cost. This method factors in your premiums, copays and the deductible all at once.

Switching Medicare Advantage During Open Enrollment

Medicare Advantage plans can and will change year over year. Many will adjust their premiums, drug coverage costs, health benefits and networks. A plan can have a $0 premium one year and increase the next. It’s wise to review all of your options each year – especially if you experienced higher than expected out of pocket costs during 2019.

We help our clients shop for new Medicare Advantage coverage each year. If you are unhappy with your plan for any reason, then the Open Enrollment window is the best (and sometimes only) time to make changes.

It’s comforting to know that we see more competition and better coverage from Medicare Advantage plans almost every year. In some counties, you might have over 40 plans to choose from. It’s wise to compare them all with an agent to see if one has lower prescription costs and/or better access to the doctors and hospitals you prefer.

Additionally, the government has loosened the reins on many Advantage providers. Many companies are offering new ancillary benefits, like: dental, vision & hearing coverage as well as rider services, wellness visits, gym memberships, free meals during recovery, and much more. While these are not reason alone to buy an Advantage plan, they can put some policies ahead of another.

Leaving Your Medicare Advantage Plan

This change can be a little tricky. There are several factors that will help determine your best course of action. Most people who drop a Medicare Advantage plan will also want to purchase a Medicare supplement and/or a stand-alone Part D Drug plan.

In almost all cases, Medicare supplement carriers will require medical underwriting if you’ve been in an Advantage plan longer than 1 year. This means you can be turned down. Your acceptance depends on how long you’ve had your Medicare Advantage plan, what type of insurance you have previously, and your overall health. You don’t want to assume you’ll be automatically accepted for a Medicare supplement policy.

The good news is you should have no trouble enrolling in a Part D drug plan when making this change. In almost all cases, those can be purchased on a guaranteed acceptance basis with no underwriting. You just need to make your choice by December 7th. After that, the Open Enrollment window is closed until next year.

Our brokerage can help you understand your options when disenrolling from a Medicare Advantage plan and returning to Original Medicare. If you have some health issues, there may be some Medicare supplement providers who will accept you – and others who won’t. We can help find the companies that may make this transition possible.

What About Changing Medicare Supplement Insurance?

Unless you live in certain states like California and Missouri, there is no open enrollment window for Medicare supplement coverage. If you want to change Medigap plans, in most cases you will need to pass medical underwriting. This usually consists of answering yes/no questions on the application and a phone interview with a medical underwriter. You won’t need to see your doctor. At the end, you can be turned down for any number of health concerns.

In other words, you can try to change your Medicare supplement insurance any time you want so long as you are able to pass medical underwriting. A lot of consumers wait until AEP to shop for better rates on these policies, but this change can be done throughout the year. We encourage our clients to call us year round to see if they can qualify for lower rates.

Applying for a new Medicare supplement during Open Enrollment does not guarantee acceptance like it does with Medicare Advantage and Part D plans. It’s best to shop while you are in good health and/or when you get a rate increase during the year.

Our Independent Medicare Focused Insurance Agency

We offer Medicare supplement, Advantage and Part D insurance policies direct from several carriers all across the country. There are no fees whatsoever to use our services. Contact us today to discuss your best Medicare options for 2020.

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Category: Medicare Advantage, Medicare Supplements

Lasso Medicare Medical Savings Accounts

Medical Savings Accounts for those on MedicareThere are several policies designed to fill the gaps in Medicare. Medical Savings Accounts from Lasso are no exception. These innovative insurance plans offer a great way save toward future health care expenses.

First, you must be enrolled in both Medicare Parts A and B to qualify. You must also live in the plan’s service area and redside in the US for more than 183 days a year. These plans are in 35 states for 2021 with two different tiers available.

What’s a Medical Savings Account (MSA)?

MSAs fall into the category of Medicare Advantage plans. They combine a high deductible health plan with an IRS approved custodial savings account. They are approved and regulated by Centers for Medicare & Medicaid services – our federal government.

By CMS rules, these policies must be offered at no cost to the consumer – they have no premiums. You still pay your Medicare Part B premiums to the government, but MSA plans cost $0.

There are two moving parts: Your deductible and the insurance company’s contribution to your account. Deductibles and contributions will vary by state and region. For example, one option for 2021 has a $5,000 deductible and a $2,000 deposit. Subtracting one from the other makes the member’s responsibility $3,000 for the year. That’s less than many HMOS and PPOs offered today.

At the beginning of each year the insurance company deposits funds into your MSA account. If you enroll in the middle of the year, then those funds (and the deductible) would be prorated based on the month of enrollment. The deposits belong to you – not the insurance company. The funds are in a no-fee, interest crediting account with Optum Bank.

Once you’ve met the deductible, there is nothing more to pay. Like most Medicare Advantage (MA) plans, it would take a hospital stay or big health event to meet the deductible. But unlike other Advantage plans, you get a large upfront deposit each year. You can apply that amount toward your deductible and other Qualified Expenses.

It’s important to note that these are not Medicare Supplement insurance plans. They are similar in that they have no network restrictions, however. With a MSA qualified policy you can see any doctor or hospital that accepts Medicare. They are not HMO or PPO type plans. You benefit most by using doctors who accept Medicare assignment – which most do.

What Should I Expect From a MSA?

Preparation for future and financial concept. Coins in glass jar with HEALTH label. Malaysia coins.The first thing to know is the insurance company’s contributions to your savings account are NOT  use it or lose it. The funds belong to you – it’s more a matter of how you choose to spend them. In this way, they work very much like a Health Savings Account.

Your funds roll over year to year and can be spent on a number of Qualified Medicare Expenses (QMEs) as defined by the I.R.S. You can spend your money on physician services, labs, scans & x-rays, hospitalization and a host of other Part A and Part B services.

All of these items would count toward your deductible.

You can also use them tax-free toward eye glasses, dental work, hearing aids, over-the-counter and prescription drugs. You can see a long list of QMEs here.

You should be aware that if you choose to spend your deposits on non-QMEs, then there can be a penalty and the funds would be taxed as ordinary income. So it’s wise to know your options. These funds are not designed to be spent on a vacation or new car.

The yearly contributions made on your behalf are always yours. You cannot contribute additional funds to your account, however. Yearly contributions only come from the insurance company, but you are in control of how they’re spent.

Why Might I Enroll & What If I Leave the Plan?

Lasso Medical Savings Account Medicare Advantage plans are most popular with our well-organized clients who are familiar with HSA type policies. These consumers also tend to be in above average health. Those who might be planning a joint replacement – or something of that nature – might benefit more from a different type of Medigap plan.

And if you leave the plan, your remaining deposits stay with you. They do no belong to the insurance company. Should you leave mid-year, they can recoup a prorated amount. And should you have any funds in your account at passing, then those go to your named beneficiaries – much like a HSA or IRA account would.

Learn More About Medicare MSA Policies

For 2021, our brokerage is working with Lasso to provide MSA policies in several states, including Ohio! There is more to know, so we’ll be happy to explain the details of this exciting new coverage.

You want to keep in mind that MSA plans, by rule, do not include Part D drug coverage, so that will be a separate expense. And if you’re concerned about the gap between the deductible and their contribution in the first year or so, then you might consider an inexpensive hospital indemnity plan as a stopgap measure.

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Category: Medicare Advantage

Three Reasons To Choose A Medicare Advantage Plan

Medicare Advantage Plan InsuranceMedicare doesn’t cover everything so it’s wise to enroll in additional coverage. In our second part series, we discuss three reasons why you may want to choose a Medicare Advantage plan over a Supplement. (View Part One Here.)

There’s not always a right or wrong way to fill in the gaps, but in this post we’ll make an argument for Advantage plans. Many of our clients choose this option for a variety of reasons, but we’ll discuss the most common reasons below. We’ll also explain what to watch out for.

Background On Medicare Advantage

What are they? These are private insurance plans that, to some extent, replace government provided Original Medicare. In other words, you’re turning your Medicare A & B coverage over to a private insurance company like, Aetna, Humana, Cigna or United Healthcare. There are also many smaller regional companies across the country offering Advantage policies as well.

Most plans are HMOs and PPOs, but you will also see PFFS, MSA and Cost plans available too. Usually these plans have networks of doctors and hospitals you’ll want to use for routine care in order to keep your costs lower. Going out of network can cost you more – ore in some cases – not be covered at all.

You can’t have both a Medicare Supplement and an Advantage plan. It’s one or the other. Either you keep your Original A & B benefits from the government and pair it with a Supplement – or turn your coverage over to a private insurance company who will insure your government benefits and more.

1) Most MAPD Plans Offer All In One Coverage

Many of our clients like the convenience of Medicare Advantage Prescription Drug plans.  These all-in-one policies privately cover everything provided by Original Medicare (Parts A & B) while also including Part D Drug coverage. They close all gaps in Medicare so you know exactly what your maximum out-of-pocket exposure will be for the year.

You’ll typically have copays, coinsurance and deductibles, but so long as you don’t have a significant health event, your out-of-pocket costs should be minimal each year. And the network of providers with Advantage plans are fairly robust in most areas. Many policies provide concierge services when you travel and will help you find doctors and hospitals in your area if needed. This is helpful for those who travel extensively and/or own multiple homes.

2) Extra Benefits At No Additional Cost

Medicare Advantage plans have more flexibility in the benefits they can offer. We have to be a little careful as Medicare does not want consumers to buy these plans for the extras alone. They are nice to have, but not usually the best reason to choose an Advantage plan over a Supplement.

That being said, many policies will include basic dental and vision coverage at no additional cost. Oftentimes, you can buy-up if you want more comprehensive dental and vision coverage – some benefits available without waiting periods. Other plans will include transportation services to and from doctor’s appointments – and free home meal delivery if you’re recovering from an ailment or procedure. Still others can provide quarterly funds toward over-the-counter items that monitor or improve health.

But the benefit we’re asked about most often is Silver Sneakers. The good news is almost all Medicare Advantage plans include a free Silver Sneakers gym membership with your policy. That’s a big help for those who enjoy going to the gym, but don’t want to pay a monthly membership fee.

3) Low To No Cost $0 Medicare Advantage Plans

The cost of the insurance policy itself is a very important factor for most of our clients. Medicare Advantage plans are popular because they can be found for under $50 a month in a lot of areas. In fact, you’ll see many HMO, PPO and MSA plans offered for $0 a month.

Having no monthly premiums does not necessarily make Advantage plans inferior, but there are some risks. Zero cost plans can have more out-of-pocket exposure to the insured, smaller provider networks, and/or less comprehensive drug coverage. You’ll want to review all of these items with your broker. We have many clients who get along just fine with $0 policies, however.

The bigger risk is if you have a significant medical event. Most Advantage policies will have somewhere in the neighborhood of $3,500-$10,000 in out-of-pocket exposure depending on whether you are in – or out of network. This would be for something like a major surgery or prolonged hospital stay. Otherwise it would be hard to reach those maximums.

And remember, you still have to pay your Medicare Part B premiums to the government no matter what. So even though your Medicare Advantage plan is free, you still pay the government. Your Part B premiums are unavoidable, but some plans offer Part B premium reductions to those who qualify.

Are Medical Savings Accounts A Good Option?

Preparation for future and financial concept. Coins in glass jar with HEALTH label. Malaysia coins.Okay we said only three reasons to consider Advantage plans, but Medical Savings Accounts (MSA) deserve a subheading here. These innovative Medicare Advantage plans offer a great way to save money while also accounting for future health expenses.

MSAs are $0 high deductible health plans that contribute approximately $3,200 each year into the owner’s account. The deposit can be used to pay the deductible which will range be in the range of $7,500 to $9,500 depending on where you live. If you’re in good health, you can cover your deductible after a two or three years of deposits.

There are no networks to worry about with Medical Savings Accounts and your balance rolls over each year. It always belongs to you. MSAs do not cover Part D drug insurance, however. Medicare Drug plans will need to be purchased separately when enrolling in an MSA.

Contact Us To Learn More About Your Insurance Options

We are a full-service, independent insurance brokerage specializing in Medicare Advantage, Supplements and Part D Drug policies. We’re licensed direct with dozens of providers across the country and can help you compare the options that best meet your needs and budget. Contact us today!

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Category: Medicare Advantage

Three Reasons To Choose A Medicare Supplement Plan

Choosing A Medicare Supplement PolicyWhen you’re Medicare eligible, you’re likely deciding how to best supplement your coverage. Should you choose a Medicare Supplement or a Medicare Advantage plan?

A good argument can be made for both, but for the purposes of this article we’ll explain why many of our clients choose a traditional Medicare supplement plan. Also referred to as Medigap policies, these plans (like F, G, & N) work with Original Medicare as oppose to replacing it.

1) No Network Restrictions With Supplements

The primary reason many of our clients enroll in a Medicare supplement is to avoid the hassle of network restrictions. When you choose a supplement, you can see any doctor or hospital that accepts Medicare. Your supplement will not in any way determine who you can see – or where you can receive care.

Medicare Advantage plans work differently. Most of these policies are HMOs and PPOs.  In other words, they have networks you need to use in order to keep your medical costs down. If you go out of network, you’ll pay more. And in some cases, out of network care may not be covered at all. Additionally, some Advantage plans require a referral from your Primary Care Physician to see a specialist.

Since Medicare Supplements have no networks to worry about (they simply start paying after Medicare stops), they’re convenient for those who travel frequently within the U.S. They can also be more suitable for those who have second homes in other states. With a supplement, you never need preapproval to go see any doctor or hospital that accepts Original Medicare.

2) You Have Limited Out Of Pocket Exposure

The other nice feature Medicare supplements provide is predictability. With almost all of these plans, you’ll know exactly what your out-of-pocket exposure is for the year. The most commonly purchased policies (like Plans G, N and F) only have a couple of hundred dollars that you are responsible for each year – if that. Then your supplement covers the rest of any Medicare approved expenses you might encounter.

Medicare Advantage plans have much higher out-of-pocket exposure for the insured. It’s not uncommon to see yearly out-of-pocket maximums in the $5,000 – $10,000 range. Your exposure will depend on what plan you choose (HMO, PPO, or PFFS) and whether you are in (or out of) network for your care. It’s much harder to predict, but the cost-sharing is much higher with most Advantage plans.

3) You’re Tailoring Your Coverage To Fit Your Needs

You’ll here many insurance companies refer to Medicare Advantage plans as, “All in One” policies.  That’s because they privately insure you for what Medicare Parts A and B cover – while also filling in some of the gaps in A and B. On top of that, many of the policies include Part D drug coverage and some dental and vision insurance.

But some of our clients like to tailor their Medicare insurance coverage to their needs. This means selecting the Medicare Supplement that’s best for them, choosing a separate Part D drug plan that best covers their specific prescriptions, then choosing a comprehensive dental and vision plan that their providers accept.

Sometimes an Advantage plan can work well for some of these part, but not all of them. Maybe they don’t have a favorable copay on a particular prescription – or one of your doctors is not in the plan’s network. While you usually pay more when purchasing each piece separately, you have the peace of mind knowing that all parts should be a better fit overall.

And there are a handful of plans available that offer a free Silver Sneakers gym membership. This is a great way to stay healthy and in shape while not needing to spend more money on memberships.

Contact Us To Compare All Of Your Medicare Options

Still not sure? Read our article on the top three reasons to choose a Medicare Advantage plan and then contact us with questions. Hyers and Associates is an independent insurance brokerage specializing in Supplements, Advantage, and Part D Drug plans.

We can help you compare all of your options so you can find the insurance coverage that best suits your needs and budget!

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Category: Medicare Advantage, Medicare Supplements

High Deductible Plan G Quotes

HD Plan G Supplemental Insurance

Several insurance companies offer High Deductible Plan G. This newer Medicare supplement is available for sale now and offers some of the lowest rates available.

As part of the recently passed MACRA legislation, all plans covering the Part B deductible are unavailable to those who are newly eligible to Medicare in 2020 and beyond. This includes Plans F, C and High Deductible Plan F. The replacement for HD Plan F is High Deductible Plan G.

What To Expect From High Deductible Plan G

The first thing you’ll notice is low rates. HD Plan F already offers some of the lowest rates of all supplement policies, and most High Deductible Plan G Medicare supplement quotes will be even lower. Depending on your age, where you live, and any household discounts, most plans will be around $40 a month. That’s the lowest you can find for any supplement.

And of course, there will be an annual deductible to meet as well. In fact, there will be two. The first would be the actual High Deductible itself. For HD Plan G, (Plan J and HD Plan F), that amount is $2,870 for 2025. It was $2,800 in 2024 and $2,700 in 2023. The second is the smaller Part B deductible which is $257 for 2025.

These numbers move with inflation, and inflation has been elevated. Thus, the deductible amounts have increased more quickly in the last couple of years.

The question is whether owners will be required to meet two deductibles with this new version of Plan G. The answer is usually, no. In other words, you’ll be working off the overall deductible while meeting the smaller Part B deductible at the same time.

For example, if you’ve met the Part B deductible, that amount would count towards and lower your High Deductible amount of $2,870. It should also be noted that one of our HD Plan G carriers offers a deductible waiver if you enroll mid-year. If you enroll in July (or after) your deductible would be reduced. This provides a strong incentive for those who might want to change sooner rather than later.

Are High Deductible Supplements A Good Choice?

They are certainly a good choice for savings. Between your Part B premiums, a Supplement, and a Part D drug plan, you can have significant monthly insurance outlays. This is especially true if you’re in a higher income bracket and assessed an IRMAA charge. Keeping your Medicare supplement premiums below $50 a month can help when you’re on a fixed income.

The other advantage to almost all Medicare supplements is that you can see any doctor or hospital that accepts Medicare. There are no networks to worry about. That’s not necessarily the case with many Medicare Advantage plans.

But once you choose a Medicare Supplement (like High Deductible Plan G), it can be difficult to change to a more comprehensive plan later. For most, you only get your one Open Enrollment (6-month) window when you’re new to Medicare Part B to purchase any plan you want.

After that, you’ll likely need to pass medical underwriting to switch to a new one. This means you can be turned down – even if it’s the so-called Open Enrollment window in the fall (AEP) each year. So you want to choose wisely as there are no guarantees of future changes.

Comparing & Purchasing Medicare Supplement Insurance Direct

Several companies offer High Deductible Plan G insurance policies. Aetna, Cigna, Humana, Medical Mutual of Ohio, Mutual of Omaha, United American, and many others are competitively priced in this market.

If you want to compare all plans and premiums side-by-side, you’re in the right place. Hyers and Associates is an independent insurance brokerage and we represent all companies directly to you – at no additional cost. Contact us today to learn about your best Medigap options.

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Category: Medicare Supplements

Annuities With A Death Benefit Rider

Annuity Death BenefitsInvestors like annuity policies for a lot of reasons, but a new feature is adding even more certainty to these guaranteed products. Some companies are now offering a death benefit rider on their contracts to assure policy growth every year.

This optional feature allows your death benefit to grow each year by a guaranteed rate no matter how the contract performs. This is a great benefit for those who are most interested in leaving a legacy for their beneficiaries.

How Do Annuity Death Benefit Riders Work?

With this innovative rider, you will have a second annuity value at work. A sub-account is created that will increase for a guaranteed number of years – usually 10-15. At passing, this value is available to your beneficiaries in a lump-sum or over a longer period of time if desired. Most accounts are required to pay the full amount over 5 years, but a lump sum option will always be available

It’s common for these riders roll-up at a 5-7% rate each year. This could be a simple interest credit, while others will compound your interest. We help our clients compare all scenarios to see which plans offers the largest guaranteed death benefit.

Death benefit riders will have some stipulations. Most will only roll-up for a maximum of 15-20 years. And they are only available to annuitants/owners who are 80 years or younger. Ones missed at 80 years might only offer an annual step-up for ten years.

An in most cases, annuity contracts with and Enhanced Death Benefit can stack policy interest growth on top of the rider. This means your death benefit value can increase above and beyond what is offered by the guaranteed rider. This is allows for growth even after the rider term has ended.

Do I Pay Taxes On My Annuity Death Benefit?

The short answer is, yes. Almost all annuity growth in a non-qualified account is taxable as ordinary income. Annuities that are in an IRA or 403(b) (referred to as qualified accounts) are taxable in full. However non-qualified accounts only tax the growth of the principal – whether it’s through a death benefit rider or regular interest and/or investment growth.

Life insurance is the only product that pays out income tax-free at passing. This is why a lot of consumers use life insurance for wealth transfer and estate planning. However, you cannot exchange an annuity account for a life insurance policy through a 1035 tax-free exchange.

Thus, if you already own an annuity with sizable gains, a death benefit rider might be your next best option for capturing those gains and then guaranteeing future growth for several more years to come.

Many of our clients also ask about probate. We don’t give legal advice, but generally speaking, annuities are not subject to the probate process. So long as your beneficiary status is up to date and in good order, probate is not required.

What If I Surrender The Annuity Before Passing?

The other account with these types of annuities is what’s called, the walkaway value. It might be more or less than the death benefit value, but in many cases, it will be lower. If you surrender your annuity before passing, you’ll get the walkaway value and the death benefit will be void.

There is almost always a cost to add a death benefit rider to a contract. It’s usually close to 1% of the contract value each year. While this is deducted from your walkaway value, it does not decrease the value of your death benefit. Thus, it’s disadvantageous to surrender your contract before passing unless you simply have no other choice.

In other words, it’s unwise to spend 1% of your contract value each year for a rider that was not used. However, if the walkaway value outperformed the death benefit value, then it might be a good idea to exchange your annuity for a new one. This is something you should speak to an experienced agent about before making an exchange.

Many of our clients are using the 1035 exchange rule to transfer, on a tax-free basis, their underperforming fixed and indexed annuities. The death benefit roll-up is a great way to rescue an old policy that might only be paying 2-3% each year. Guaranteed growth for your beneficiaries makes good sense in many cases.

Contact Us To Learn More About Your Annuity Options

Let’s face it:  If you’ve ever shopped for annuities, you know there are many options. One size does not fit all. Some are designed for growth, others are for income, and still others can be used to account for long term care needs.

An annuity with a guaranteed death benefit is more designed for growth and wealth transfer. It might be more suitable for owners who do not intend on accessing their money but are most interested in passing on the largest amount possible to their beneficiaries. No matter your needs, we can help. Contact us today to review your best options.

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Category: Annuities, Retirement Planning

A Guide to Immediate Annuities

Retirement income annuityWe are all working toward a comfortable, financially stable retirement. We want to enjoy more time with our loved ones while immersing ourselves in the activities that bring us peace and joy. The Hyers & Associates team is here to help you achieve your retirement goals.

The fact is you need a plan to create a reliable income stream to support your lifestyle during your retirement years. You want to wake up each day knowing you have a solid foundation in place that provides regular income. One way to facilitate your dream is to buy an immediate annuity.

What is an Immediate Annuity?  

An immediate annuity is a way of ensuring a regular income throughout your retirement years. An immediate annuity is usually purchased in a lump sum – and then an agreed upon amount is paid out when you’re ready. Essentially it acts like a pension plan, supplementing your other income.

Your investment grows while in deferral and with some accounts, your income can increase each year. There are several different ways to establish your personal income stream. One size does not fit all. We’ll help you find the plan that best accomplishes your financial goals.

The insurance is that you will have a set income guaranteed by the policy. The insurance company will look at the type of annuity policy being purchased, the term and the person’s life expectancy. Based on those factors and others, your chosen insurance company will issue you a check for the agreed upon amount for the agreed amount of time.

Things to Consider With An Immediate Annuity

There are several factors to consider when shopping for and purchasing an immediate annuity account. Are you looking for the highest payout immediately? Or would you rather have a lower payout for a longer period of time? Is the income just for you or for your spouse as well? Are survivorship benefits important beyond you and/or your spouse? Do you want the income to have the ability to grow or even double for long term care expenses? These products can be tailored in several ways.

With income annuities, you can choose to have an agreed upon fixed amount paid regularly, a guaranteed payout over the contract, or a payout based on certain stock market indexes. A policy that moves with inflation will generally pay out less initially than one with a guaranteed amount. Plans that pay income to spouses or have survivorship benefits will usually pay less up front as well.

When purchasing your policy, you will choose how long your income lasts. It can be a fixed number of years or for your entire life. Your income can begin after only one month or it can be postponed (deferred income annuity) for several years in order to grow your investment – and returns.

When considering an immediate annuity contract, most insurance companies show you the payout rate. The payout rate is not the same as the yield or rate of return. Your rate of return can vary depending on how long you live. That being said, it’s easy to compare the payout streams of several different companies at once. This will allow you to see who’s offering the best rates.

Making a Commitment

One important note:  It can be difficult if you change your mind after purchasing an immediate annuity. You need to think of this as a commitment to gain a guaranteed income in your retirement years. There are few contingencies for a change of heart further down the road. You may be able to change when your payouts begin, but it’s often not possible to get a return of your initial premium back in a lump sum.

Several policies will provide flexibility in your income start date, but this is along term investment for your future. It’s a very smart way to supplement your other investments. If the market takes a turn for the worse, or interest rates drop further, you will still have a significant income stream to rely on to fund all the things you want to do in retirement.

Call Us For More Information

The Hyers & Associates team members are available to discuss annuities and which types might fit your needs best. Planning and considering your financial goals is the important part of making your retirement happen. Contact us today so we can get started on your future income quote. 

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Category: Annuities, Retirement Planning

Understanding Annuity Liquidity Options

Annuity WithdrawsAt our independent agency, we work with all types of annuity policies. One of the primary concerns our clients have is access to their policies. They want to know they can make withdrawals when needed.

The good news: There are several ways policyholders can withdraw money from their annuities. Most contracts have several liquidity provisions providing access to income and principal. Withdrawals can be taken regularly or as needed. We discuss all of the options below.

Annuity Interest Withdrawals For Income

Most annuities allow the owner/annuitant to take regular interest withdrawals. They are fantastic products for regular passive income payments during retirement. Owners can choose from monthly interest payments, quarterly, semi-annual or annual disbursements.

We see many of our clients use fixed annuity accounts for regular income – and indexed policies for annual withdrawals. The point is you have a lot of flexibility in when and how you take payments. And if your need for income decreases, you can stop your interest payments and defer them to a later date.

Annual Liquidity Of 3%-20% Of Your Principal

Most annuity contracts offer an annual free withdrawal of between 5%-20% of the accumulated value. This gives you access to interest and principal during the year and at arbitrary times.

The most common amount is a free 10% annual withdrawal feature. However, some will stack your withdrawals if you did not use it for one year. In other words, you could have a 20% withdrawal available after two years.

The requirement for some contracts is that you wait one year before making a 10% withdrawal. But if you find yourself needing more for a small emergency, an annual annuity withdrawal amount is a nice feature to access your principal.

Annuitization – Principal & Interest Disbursements

Another option many policy owners use for regular annuity payments is called an annuitization. Annuities can be annuitized in several ways in order to create a regular stream of income.

Once annuitized, your policy is guaranteed to provide payments for a set numbers of years – or even a lifetime. If you pass away prematurely, your unused principal does not belong to the insurance company. Leftover funds can go to your named beneficiaries.

In some cases, an annuitization can start right away. With others, it would begin after a few years of deferral. Most of our clients choose not to annuitize their policies unless they’re wanting guaranteed principal and interest payments. It’s really up to you.

Withdrawal for Chronic Illness & Health Issues

One of the biggest concerns for investors is paying for future income expenses. Fortunately annuities can help. Almost all contracts have chronic illness, hospitalization, and/or confinement riders available at no cost.

These provisions will waive surrender penalties on some – or all of the contract value – if one of the owners is diagnosed with a chronic illness. But many policies go beyond that.

There are several indexed annuities with income riders that will double your income if you need long term care. Some will double your payments for a nursing home and others for a home healthcare stay. This a smart, no-cost way to increase your income for LTC expenses.

Another possibility is to buy a tax-qualified long term care annuity. These policies require medical underwriting, so some applicants will not qualify due to poor health. Those that do qualify will benefit from their initial investment being tripled in the event long term care is needed. These hybrid long term care annuities are popular and allow owners to account for different scenarios during retirement.

Term Expiration – Non-Renewal Of Contract

No rule says you have to renew your annuity contract once the term is up. Most of our clients purchase short-term annuities with 2-5 year terms.

After the term is up, you may be able to keep your contract surrender-free and allow it to continue to earn interest at a one-year declared rate. With interest rates up (and more annuity competition) many of these accounts renew at very competitive levels.

Once your contract is out of its surrender period, you can withdraw all of your funds at anytime – no questions asked. As you grow older in retirement, it may be a wise way to assure liquidity as opposed to choosing the highest rates with policies that may offer less liquidity.

No Surrender Penalties At Passing

A common question about annuities is what happens upon passing. With the vast majority of policies sold today, your beneficiaries would receive the lump-sum annuity value at passing surrender free. In other words, all surrender penalties are waived at passing.

It should be noted that this is not the case with every annuity. Some contracts will provide higher rates if you remove the death benefit feature. Some of our younger clients who add their spouse as a joint owner/annuitant are comfortable waiving this rider to lock-in higher rates and larger income payments. Again, it’s up to you.

Selling Your Annuity Payments

One final option is to sell your annuity (or annuity payments) for a lump sum cash settlement. We are not proponents of this strategy. It’s a last resort option, but we see some owners sell their structured settlements for cash to make ends meet. We are not buyers of such contracts, but there is a market for them.

Contact Us For More Information

Do you still have questions about annuity liquidity? Do you want to know if you can take money from your contract? Contact us today to learn about your best options.

We offer the highest annuity rates with the easiest access to your interest and principal. We are an independent brokerage and will help you compare the most suitable investment options for your situation.

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Category: Annuities

Comparing The Best Medicare Supplements

Popular Medicare SupplementsAt our independent agency, Medicare supplement Plans F, G and N are the most requested plans by our clients. Their popularity can be explained by the fact that these three plans cover the most important gaps left behind by Medicare. But there are some key differences.

Almost all carriers offer all three plans, but there are important changes coming. In 2020, Plan F will no longer be for sale to those who are new to Medicare. It will continue to be available to those who were previously eligible, however.

Medicare Supplement Plan F – The Most Comprehensive Coverage

Traditionally, Plan F has been the popular Medicare supplement.  At one point, two out of every five supplement purchases was a Plan F policy.  The primary reason, is that it fills in all of the gaps in Medicare – every single one. In other words, if your health care services are a Medicare approved expense, then Plan F will cover the remaining balance.

Due to the fact that it’s the most comprehensive supplement offered, it’s also the most expensive as well. Depending on where you live, your gender and your age, Plan F can be around $150 per month. In some areas it will be less – and in others much more. The older you are the more expensive it will be.

However, the rules are changing in 2020 and we are seeing a lot less demand for Plan F. Most of our clients don’t want to purchase a policy that will no longer be available to the general public. The reason is that rates will likely increase more quickly once this policy becomes less available. Premium stability is one of the more important factors when shopping for supplemental insurance.

Additionally, some carriers also offer High Deductible Plan F. HD Plan F won’t cover it’s portion of your bill until the yearly deductible has been met. Medicare, of course, will still pay its portion first. High Deductible Plan F is very popular because the premiums can be very low. In many places, the premiums are around $35 a month.

(It is important to note that, like all Medicare supplements, Plan F does not cover Part D prescription drug coverage. All Part D Drug Plans must be purchased separately on a stand-alone basis.)

Medicare Supplement Plan G – Also A Wise Choice

Plan G covers everything Plan F does except for the Part B deductible. This deductible usually changes each year, but has always been less than $200. So the only difference is a one-time, very small deductible. But when you run the premiums, Plan G can be nearly $25 less per month. This premium difference more than covers the deductible in many cases. You’re saving money overall.

Plan G is also popular because it is not a guaranteed issue Medicare supplement at this time. This means it’s a little harder to buy in some instances and therefore is more exclusive. This exclusivity translates to lower premiums and lower premium increases. This will change in 2020 however as it becomes one of the new Guaranteed Issue policies. I recommend that most of my clients consider Plan G when they want one of the more comprehensive supplements.

We also expect that High Deductible Plan G will be rolling out very soon. It will likely be the least expensive supplement available for purchase.

It is also worth noting that many insurance companies offer preferred discounts to those who are in their Medicare open enrollment window. Healthy consumers can also receive a preferred rating if they meet certain health criteria. And some plans will offer spousal discounts even when the other spouse does not apply. You always want to ask about any discounts that might be available to you.

Plan N – The New Supplement For Long Term Stability?

Since Plan G will have to take over the old role of Plan F by becoming the new Guarantee Issue supplement, Plan N is in a great position to be the wiser choice of the three. It will be the new exclusive policy in 2020, but it does have some different gaps to consider.

First you want to know that Plan N covers everything that Plan G does except for Part B Excess Charges. These charges (when doctors don’t accept Medicare assignment) are rarely encountered, however. Additionally, Plan N has a $20 office copay and $50 emergency room copay. So with Plan N you have three out of pocket costs to consider:

  1. The Part B Deductible
  2. Part B Excess Charges (where applicable)
  3. Office and ER Copays

In exchange for a little more out of pocket exposure, Plan N rates are some of the lowest available for a comprehensive supplement. In many areas, Plan N is around $85 a month for those who are at or near age 65. And now that Plan G will be issue on a Guarantee Issue basis, Plan N will be the new exclusive plan. As it will be harder to enroll in for some, it will have a healthier population and lower rates increases overall. In many cases, we see Plan N rate increases around 4% which is about half of what we see for Plans G & F.

Contact Us For Medicare Supplement Quotes & Consultation

We are an independent insurance agency specializing in Medicare supplement insurance plans. We license direct with all carriers – so there is no extra cost to you.

Contact us today to compare the lowest rates in your area!

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Category: Medicare Supplements

What Are Annuities? How Do They Work?

What Are Annuity Policies?The Hyers & Associates team works with annuities of all kinds. We will help you understand how these policies are for retirement planning – or as an investment opportunity.

Many people want a safe and reliable way to invest their money while retired. An annuity is a smart option worth considering. Understanding their purposes will help you choose the best way to manage your money and enjoy a stable retirement.

 

What Is An Annuity Insurance Policy?

An annuity is a contract with an insurance company. The contractual agreement is that you will deposit an agreed upon amount of money with an insurance company, and in return, they will provide a known rate of return for growth, income or both.

If you want income, you can choose to receive your payments on a yearly, semi-annual, quarterly or monthly basis. Alternatively, you can defer your income for a later time if you wish to grow your principal for future needs. Some consumers withdrawal only their interest, while other receive both interest and principal. Annuities offer several ways to establish a present or future income stream.

If you don’t want income, you can defer your interest gains. There is really not limit to how long some investors defer growth. When their current term ends, they rollover or take advantage of non-qualified 1035 exchange transfer rules to being a new annuity. This will defer gains even longer.

These accounts accept both pre and post-tax funds. Policies are referred to as qualified and non-qualified annuities, respectively. You can deposit IRA, 401(k), 403(b) or extra funds at the bank into an annuity account.

View Current Fixed Annuity Rates

The Pros Of Annuities

 

  • A great way to plan for lifetime income
  • Better interest rates than CD’s or other fixed-income investments
  • Growth can accumulate tax-deferred and reduce your taxable income
  • With the flexibility of a deferred annuity, you can determine your future income stream
  • You can provide lifetime payouts to just yourself – or also a spouse if desired

 

The Cons Of Annuities

 

  • Unplanned early withdrawals can decrease future payouts
  • Large early withdrawals may also incur surrender charges
  • Some payouts are fixed and don’t account for inflation
  • Long-term accounts may miss out on future rate increases

 

Is An Annuity The Right Investment For Me?

Guaranteed Investment GrowthIf you are in a high-income tax bracket and have maxed out other investment opportunities, an annuity may make good sense. You need to be willing to invest your money for a set term – usually 1-10 years. Before choosing an annuity, be sure you ask questions and make sure you understand the contract before agreeing to it.

If you need to withdraw your money early, surrender charges can apply. Most annuities offer the accumulated interest and 10% or the principal each year with no surrender penalties. If you’re choosing an immediate annuity with guaranteed payments, then there would be no surrender fees. Be sure to ask your agent about all of your withdrawal options.

 

What Happens If I Die?

It depends on your contract, but with almost all annuities your entire account value pays out to your named beneficiaries. There is a lot of misinformation about annuity policies; please know that the insurance company does not keep your accumulated funds at passing.

Typically your beneficiaries have several options available to them. A spouse can usually keep the contract inforce or surrender the contract and reinvest the account value somewhere else. Children and other named beneficiaries will usually need to surrender the contract, but can choose to receive payouts over 5 years to defer any accumulated income taxes.

That being said, there is one type of contract the ceases payments after the owner dies. They are called life only annuities with no period certain. We don’t see these purchased very often, but they make sense in some very specific cases. Someone might purchase this type of contract to maximize lifetime income, but s/he would be very aware that payments would cease upon passing.

 

Call Us With Your Questions

If you are considering buying an annuity and have questions, the Hyers and Associates insurance team works with annuities everyday. We are available to answer any questions or concerns you have. There are a lot of things to consider, and we’re here to help make the process easier, so contact us today!

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Category: Annuities

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Plan G Medicare Supplement Insurance

Plan G Medicare SupplementIf you are near (or already) eligible for Medicare, you might be wondering about your Medigap options. You should consider Medicare Supplement Plan G straightforward choice for affordable & comprehensive coverage.

It’s one of the most complete plans available. It also offers good value when compared to other plans like F and N. The premium increases tend to be less with Plan G and your yearly out-of-pocket exposure is always known.

Medicare Plan G vs Plan F & N

As an independent broker, I found that many Medicare-eligible consumers leaned toward Plan F before 2020. Now they are deciding between Plans G and N. 

Plan F covers all gaps in Medicare Parts A & B. So long as your medical care is a Medicare-approved expense, it will fill in all of the gaps. Plan N has copays and does not cover Part B Excess Charges. Are these two better choices than Plan G?  

Here is the review:

Is Plan G a Good Choice for Medigap Coverage?

What are the best arguments for Plan G Medicare supplement insurance? First, it’s important to know Plan G fills in all gaps in Medicare Parts A & B except for one. Plan G does not cover the Part B deductible.

The Medicare Part B deductible is $257 in 2025. It was $240 in 2024 and $226 in 2023. These increases coincide with other increases in Medicare Part B premiums and consumer out-of-pocket exposure. 

For reference, the deductible was $233 in 2022, $203 in 2021, $198, in 2020, $185 in 2019, $183 for 2017-18, and $166 in 2016. For the years 2013-15, the amount was $147.

Increases are regulated by the government and have not increased significantly year over year. The deductible changes when officials at CMS (Centers for Medicare & Medicaid Services) announce new cost-sharing amounts.

It’s important to note that Plan F covers the one-time, yearly Part B deductible and Plan G does not. That is the only difference between the two. For reference, Plan N does not cover the Part B deductible either.

What are the Advantages of Plan G?

Medicare-eligible consumers should consider Plan G for a couple of reasons. The first reason is cost. As you price Medicare supplements from the vast number of insurance carriers, you will see Plan G is over $30 less per month than Plan F in many cases. (And it’s not always much more expensive than Plan N.)

When you take $30 and multiply it by the 12 months in a year, you come up with $360. So why spend an extra $360 more per year in Plan F premiums to cover a $257 deductible? The math does not add up. You are saving money with Plan G over Plan F. And it’s one of the most comprehensive medicare supplements available.

Watch Our Video to Learn More about the Advantages of Plan G

What About The Annual Medicare Part B Deductible?

This begs the question: What happens if CMS raises the Part B deductible well above $257? What if they decide to increase it to $500 or even $1000?

First, you should know Part B deductible increases are tied to inflation. So unless the rules change or inflation increases significantly, the deductible would only increase incrementally each year. This has always been the case.

In the event the Part B deductible increases significantly, Plan F premiums will increase as they must account for this gap. Insurance companies will not absorb the increased cost should it occur. They will pass it on to policyholders.

One way or another you’re paying for it – either in the way of higher premiums or by meeting the deductible itself. With Plan G you are in more control and can save money through lower premiums. That’s why it is a good Medicare supplement plan. 

Plan G Is Now A Guaranteed Issue Policy

Medicare changed the rules in 2020. Plan F is no longer available for those new to Medicare beginning January 1. See more on that below.

This means that like Plan F before, Plan G is now offered on a guaranteed issue basis for different reasons. This would be one argument against Plan G. Guaranteed Issue plans tend to increase in price more quickly because the insurance companies offering them are forced to accept consumers with poor health. This drives up claims and in turn increases premiums for all who are enrolled.

Plan N (same as it’s always been) is not a guaranteed issue policy. Thus, insurance companies can be more selective in who they accept for this plan. Medical underwriting will determine who qualifies.

With (perhaps) fewer unhealthy enrollees in a plan, there will be fewer claims. Rates will increase more slowly. It was not unusual to see Plan F rates go up more quickly in the past. Now that Plan G is a guaranteed issue policy (when applicable), we expect to see monthly premiums increase more quickly than with a Plan N Medicare supplement.

Some Medicare Supplements Discontinued In 2020

Yes, it’s true. Any plans covering the Part B deductible are no longer offered to those gaining Medicare eligibility starting in January 2020. Those who were eligible for Medicare before 2020 can keep their existing coverage, however. The three policies affected are Plans F, C, and High Deductible F.

What does this mean? In practice, discontinued blocks of business will trend older and perhaps unhealthier. And rates may increase more dramatically because of this. When rates go up, consumers shop. Those who are healthy enough to find new coverage (like Plan G, N, or High Deductible G) will likely enroll in new coverage, further exacerbating the problem. This happened with Plan J when it was completely discontinued in 2010.

That’s why you see a lot of companies introducing Plan G to their portfolio. United Healthcare (AARP branded) and Anthem Blue Cross and Blue Shield now offer Plan G in Ohio and several other states.

High Deductible Plan G Is Now Available

Since the High Deductible Plan F rules have changed, High Deductible Plan G is the new option for those new to Medicare in 2020 and beyond. This policy is available to all Medicare beneficiaries both new and old. The plan is interesting as it has essentially two deductibles. The normal $2,870 High Deductible annual amount as well as the Part B deductible.

Will the Part B deductible also count towards the normal $2,870 plus the high deductible? In most cases, yes it will. So you will likely only have to meet one. If, however, you met the high deductible with only Part A expenses, then you would still be responsible for the Part B amount.

It would be very rare for a situation like this to occur, but it’s something to be aware of. High Deductible Plan G is gaining traction. More companies now offer this choice. Premiums are very low and you can see any doctor or hospital that accepts Medicare.

Contact Us To Compare Plan G Medicare Supplement Quotes

In summary, when shopping for Medicare supplement insurance and comparing benefits, plans, and prices – Medicare Plan G should be on your list. The premium difference usually makes up for the Part B deductible and the smaller rate increases are helpful. Contact us to learn more about Medicare supplement plans!

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