CenterStage

Medicare is a governmentfunded health insurance program for those aged 65 and above, those under 65 with certain disabilities, and those with End State Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS). Employers that offer group health insurance plans to their employees have an interest in learning how employees’ entitlement to Medicare benefits can affect the administration of those plans. We sat down to speak with Olivia Childs, a Senior Solutions Licensed Agent at Saxon Financial Services, to get some more information on Medicare for beginners.

When asked about the number one thing to keep in mind when trying to figure out your first steps with Medicare, Olivia commented, “Ask a licensed agent for assistance. Advertisements can be confusing, and everyone wants to make the right choice. Using my expertise, I take the fear out of the decision making, so my clients can make an informed decision concerning their healthcare.”

What is Original Medicare?

With original Medicare, your coverage is through Parts A and B. Part A includes inpatient and/or hospital coverage, while Part B includes outpatient and/or medical coverage. Through this type of Medicare, you are provided a red, white and blue card to show your providers when receiving treatment. While most doctors take Original Medicare coverage, it is important to check whether your provider participates. If you visit one that does,
then your Medicare card will limit how much you can be charged.

Through Original Medicare, you are responsible for a 20% coinsurance if you see a participating provider and after meeting your deductible. Some basic, key things to know about Original Medicare include that:

• For Medicare Supplement Insurance, you have the choice to pay an additional premium for a Medigap to cover Medicare cost-sharing.
• You do not need referrals to see a specialist.
• For drug coverage, you must sign up for a standalone prescription drug plan.
• It does not cover vision, hearing, or dental services.

What is Medicare Advantage?

Unlike Original Medicare, Medicare Advantage are private plans that contract with the federal government to provide Medicare benefits. These plans are also known as Medicare private health plans or Part C. Some of the most common types of plans are:

• Health maintenance Organizations (HMOs)
• Preferred provider Organizations (PPOs)
• Private Fee-For-Service (PFFS)

If you join a Medicare Advantage Plan, you will not use the red, white, and blue card when you go to the doctor or hospital. Instead, you will use the membership card your plan sends you to get health services covered. Plans must provide the same benefits offered by Original Medicare, but they may apply different rules, costs, and restrictions. They also may offer certain benefits that Medicare does not cover. Just like Original Medicare, there are some key items to be aware of:

• Your cost-sharing varies depending on plan. Usually pay a copayment for in-network care. Plans may charge a monthly premium in addition to Part B premium.
• You cannot enroll in a Medigap plan.
• You can typically only see in-network providers.
• You will also typically need a referral to see a specialist.
• For drug coverage, in most cases, the plan provides prescription drug coverage (you may be required to pay higher premium).
• It may cover additional services, including vision, hearing, and/or dental (additional benefits may increase your premium and/or other out-of-pocket costs).
• You will have an annual out-of-pocket limit. Plan pays the full cost of your care after you reach the limit.

If you sign up for Original Medicare and later decide you would like to try a Medicare Advantage Plan–or vice versa–be aware that there are certain enrollment periods when you are allowed to make changes.

Employer Requirements

Employers are required to file annual Centers for Medicare and Medicaid Reporting and Employee-Notice Distribution letters even if one employee has coverage under Medicare Parts A, B, or C. Usually companies receive letters from their insurance companies asking for a Federal Tax Identification number and the group size of employees each year.

If your company has 19 or fewer full- and part-time employees, Medicare is almost always primary. Here, it is essential that employees turning 65 enroll in Medicare Parts A and B. If they do not, generally they will have to pay anything that Medicare would have covered. If your company is larger, various rules determine whether your group plan is the primary or secondary payer. MSP requirements also apply for Medicare-eligible employees who are disabled or have end-stage renal disease.

Once per year, written notice distribution is required to all Medicare-eligible employees. This must inform the employee whether the employer’s prescription drug coverage is ‘creditable’ or ‘noncreditable.’ Notice can be sent electronically, but it is often easier to distribute in written format. These need to be sent before October 31.

It is a good idea for employers to provide employees with written details about their employer-provided coverage, which will help them decide how to handle their Medicare choices.

How does it work with COBRA?

COBRA coverage is usually offered when leaving employment; if the employee has COBRA and Medicare coverage, Medicare is the primary payor. If an employee has Medicare Part A only, signs up for COBRA coverage and waits until the COBRA coverage ends to enroll in Medicare Part B, he or she will have to pay a Part B premium penalty.

Employees should be disenrolled in COBRA once they turn 65. A number of Medicare beneficiaries have delayed enrolling in Medicare Part B, thinking that because they are paying for continued health coverage under COBRA, they do not have to enroll in Medicare Part B. COBRA-qualified beneficiaries who have delayed enrollment in Medicare Part B do not qualify for a special enrollment period to enroll in Part B after COBRA coverage ends.

According to the Department of Labor Bureau of Labor and Statistics, the number of workers age 65 and older has increased dramatically since the late 1990s. With that trend expected to continue, companies have an excellent opportunity to assist employees in their health insurance decisions. Navigating the ever-changing Medicare rules can be tricky.

However, with the help of a qualified Medicare specialist, the process can be rewarding for the employer and employees.

Positioning for Long-Term Success

Offering Medicare coverage to your employees can be a daunting, confusing, and tiring task – especially when you go about it alone. While articles like this one can be helpful in understanding what Medicare is, the logistics of actually implementing it as a solution for your employees is a whole other story.

Saxon Financial Advisors creates strategies that are built around you and your vision for the future. The key is to take the first step of reaching out to a professional and then letting us guide you along the path to a confident future. We don’t stop at just a plan. We take the journey with you, reassessing your life situation, changing needs and goals and ensuring that your plan continues to meet your future needs in an ever-changing world. We offer several helpful services to businesses, just like yours, including:

• Risk Management
• Tax Planning
• Education Planning
• Retirement Planning
• Estate Planning
• Business Planning

People are your most valued asset and our greatest reward. Our compassion for people drives us to operate differently, assessing the needs of the population alongside the vision and goals of your organization. At Saxon, we truly listen, engage, understand and advise solutions to help meet your overall company goals. Employee Benefits will have an impact on your organization from recruitment, retention and population wellness to productivity and your bottom line. To us, it isn’t the size of your organization that matters most, but rather the needs of the people within it.

For more information, contact Olivia Childs, a Senior Solutions Licensed Agent, at (513)904-5955 or ochilds@gosaxon.com.

About Your Advisor

Olivia Childs is a Senior Solutions Advisor at Saxon Financial. She graduated from the University of Cincinnati with a degree in Organizational Leadership. She was involved in the Human Resources department and a member of HR Succeeds, a mentor program with professionals and students. In her free time, Olivia volunteers at the Cincinnati Epilepsy Foundation. When it comes to helping her clients with Medicare, Olivia pointed out, “Healthcare is personal. I love being a resource for my clients to use to help them make the best decision concerning a Medicare plan.”

Not Connected with or endorsed by the U.S. government or the federal Medicare program.