Allsup reports that individuals need guidance in complexities of first-time Medicare enrollment as only one in four employers now offers retiree health coverage
—July 29, 2013―With the number of employers offering group health coverage to retirees continuing to decline, more seniors are confronted with the complexities of making first-time Medicare enrollment decisions, according to Allsup, which provides Medicare plan
selection services to seniors and people with disabilities.
“At many companies, retiring used to mean transitioning from your employer’s health plan to a retiree health plan,” said Paula Muschler, manager of the Allsup Medicare Advisor®
(AMA), a Medicare plan selection service offering personalized help that includes impartial, customized research and enrollment assistance. “Now, rather than selecting from one or two employer-provided options, more and more individuals are faced with trying to navigate through dozens of different Medicare plan options.”
Only 25 percent of employers reported offering retiree health benefits in 2012. According to a Kaiser Family Foundation survey of employers with more than 200 employees, this number is down from 32 percent in 2007. In 1988, nearly two-thirds of employers (66 percent) offered retiree group health coverage.
“With the decline in employer retiree health benefits, boomers planning for retirement and seniors who are losing retiree health benefits need guidance,” Muschler said.
Retirees and Employer Healthcare: Big Transition
Allsup encourages financial advisors to discuss Medicare plan selection with their clients as they approach their 65th birthday, as well as throughout retirement to identify how their health coverage may change.
Following are two situations when financial advisors can help their clients navigate the Medicare maze.
- Boomers turning 65 and getting ready to retire. Medicare enrollment happens through what is called the person’s initial enrollment period.
Those turning 65 have three months before their birthday, the month of their birthday and three months afterward to make their Medicare plan selections without penalties. “Since fewer employers offer retiree coverage, it’s important that people begin to study their options early enough to make good choices based on their needs,” Muschler said. “An Allsup Medicare specialist can help financial advisors and their clients sort through some of the factors involved.”
Issues that can influence someone’s choices about Medicare include their healthcare condition and anticipated procedures, prescription drug needs, financial resources, and plans for travel and relocation in retirement. It’s also important to understand the deadlines for first-time enrollment and possible penalties if those deadlines are missed.
On average, seniors have 31 plans for prescription drug, or Part D, and 20 plans for Medicare Advantage coverage from which to choose. For those retired at 65, other alternatives for coverage could include a spouse’s coverage, if they are still working, as well as veterans healthcare coverage, which might affect Medicare choices. For boomers still working at 65 and eligible for employer health coverage, additional factors need to be considered to properly coordinate benefits.
- Seniors already retired and losing retiree healthcare coverage. A key element for seniors in this situation is their age.
Those older than 65 should have enrolled in Medicare when they reached their initial enrollment period. “Retiree coverage is secondary to Medicare, so they already would have Parts A and B,” Muschler explained. “But losing their retiree group health coverage triggers their option to buy Medigap.”
Along with the option to choose supplemental coverage, they would be able to buy Part D if their retiree coverage was creditable. One more option enters the picture, as well. Seniors could transition from original Medicare to a Medicare Advantage plan with prescription drug coverage. The time period to make these choices is limited, so don’t delay, Muschler advised.
For early retirees, reaching 65 could be the trigger to losing retiree coverage.
Often, retiree group health coverage can confuse seniors who assume Medicare is not important because they have other insurance. “We cannot stress enough that turning 65 is a critical time period for Medicare beneficiaries to consider what they need and how they will afford it,” Muschler said. “This is their opportunity to make first-time Medicare decisions that ensure they have the proper coverage and avoid penalties later on.”
Financial advisors can play an important role in helping clients consider these factors and the complexities of Medicare before it’s too late. “If a client is past their initial enrollment period, then financial advisors can intervene to help them make wise choices going forward, especially with the help of a Medicare specialist like Allsup,” Muschler said.
Financial planners also can assist their clients with overall retirement healthcare planning. “Along with Medicare timing and coverage options, financial advisors can help retirees examine their anticipated healthcare needs and financial resources,” Muschler explained. “Healthcare is one of the primary financial concerns for seniors, and financial advisors can reassure their clients with careful preparation and expert Medicare assistance.”
The Allsup Medicare Advisor is an affordable, flat-fee based service for Medicare-eligible individuals. It has features that help financial advisors guide their clients to the Medicare plans that match their specific lifestyles and healthcare needs. Employers also use Allsup Medicare Advisor for their employees who are retiring and transitioning to Medicare.
Allsup offers a free brochure for seniors and their financial advisors called, “Turning 65 and Medicare Enrollment.” For more information, financial advisors may go to FinancialAdvisor.Allsup.com
, or call (888) 220-9678.
Anyone becoming eligible for Medicare may contact a Medicare specialist with the Allsup Medicare Advisor at (866) 521-7655.
Allsup is a nationwide provider of Social Security disability, veterans disability appeal, Medicare and Medicare Secondary Payer compliance services for individuals, employers and insurance carriers. Allsup professionals deliver specialized services supporting people with disabilities and seniors so they may lead lives that are as financially secure and as healthy as possible. Founded in 1984, the company is based in Belleville, Ill., near St. Louis. Visit http://www.Allsup.com or connect with Allsup at http://www.facebook.com/Allsupinc.
The information provided is not intended as a substitute for legal or other professional services. Legal or other expert assistance should be sought before making any decision that may affect your situation.