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B. W. (Bill) Friedman, 33
Santa Fe, New Mexico

After age 65, it is critical to select a medical insurance that fits your needs and budget.


Prim, my wife, and I are near the corner where the landscape changes abruptly--our 65th birthday. She’s older than I am by a few months and tells me from her experience, “You know how you feel now, that’s as good as it will ever get.” Wow, so much to anticipate!

New IDs are required, our medical coverage changes from CHAMPUS to Medicare, and the supplements must change as well. There are more choices out there than Carter has little green pills with red dots. Situations differ. Programs for military retirees, retired state, federal, or private business employees--all have their twists and turns. And of course, costs. I won’t cover long-term health care. That’s entirely another ball game, with an expensive ticket.

I have spent the last three weeks trying to pick my way through the maze. There are plans from AARP, USAA, and at least a dozen others, including a plan being sponsored by The Supreme Council, 33, in Washington, D.C. [See note at the end of this article.] I want to describe this knotted ball of yarn. Those who have gone through this before can laugh at my bewil-derment, but you might want to check your premium against those of other providers. You might save some money and gain certain advantages. For those approaching the “pits” of turning 65, I hope I can save you some time or at least ease your fear upon approaching the subject.

If you are well off and can stand to pay the 20% of a medical bill not covered by Part A (Social Security pays 80% of your hospital bills), and Part B (Social Security pays 80% of your medical costs: doctor bills, tests, drugs, etc.), you don’t have a problem. That is where we all would like to be. If this is not the case, you need to solve the maze and find a supplemental medical insurance program to cover all or part of the 20% for which you are responsible.

Health Maintenance Organizations

HMO’s are a whole other animal. You are held within the provider’s system. You assign your Medicare coverage and payments for Part A and/or Part B to the HMO. This qualifies you for the so-called Free or Basic Plan. If you want further coverage or additional benefits, you pay an additional premium.*

Once signed up, you must see your “Primary Care Physician,” a doctor you pick from a list of physicians who are members of the HMO. For a problem requiring a specialist or for treatment beyond the Primary Care Physician, you must still see and be referred by the Primary Care Physician for coverage to be authorized. For some urgent or emergency care, you can go outside the HMO, but there are limitations here also. If your favorite doctor is not a member of the plan, you can use him/her, but the plan will not pay your bills.

Medicare

If you started collecting Social Security before age 65, the Social Security Administration (SSA) will contact you several months before you turn 65. You are automatically covered by Part A. You may request Part B, and will have approximately $41.00 withheld from your Social Security check. With this combination, about 80% of your medical expenses will be paid by the program. Some amounts depend on inpatient (admitted to the hospital) or outpatient (day surgery, etc.) care. You need to be aware of the limits of your coverage. There are times when you may want to deny Part B; it depends on your circumstances. SSA will explain your benefits.

Medicare Supplements

It’s a jungle out there! The Federal Government has established 10, count them, 10 plans which they have conveniently lettered A through J. For example, a Plan designated “C” has the same exact coverage no matter how much or to whom you pay your premium. Premiums will vary from insurance company to insurance company--sometimes by considerable amounts.

It would be worth comparing your present company’s cost with the charges of other companies. You might be able to save some money. The only unknown in the question is service and how well a particular company responds.

From the 10 plans, each insurance company will choose which ones they will offer, and it will vary from state to state. In New Mexico, USAA offers A, D, F, and G. AARP offers all ten. You may have to look for a company that offers the specific coverage you might need.

As if it were not interesting enough, now they complicate the whole thing again by adding age ranges. They are 65-69, 70-74, 75-79, 80-84, and 85 and over. As you advance in age, the premiums go up, but not in all cases. It’s all up to the insurance company. Although the rates have increased considerably over the last several years, AARP, for example, has flat fees; that is, they are the same for all ages. Another insurer, for example, starts out at $66.00 per month from 65 to 74, then jumps to $116.50 from there on. Some jump!

The most expensive is the J Plan because it has the most extensive coverage. Here is what the J Plan covers: the basic benefits, skilled nursing coinsurance, Part A deductible, Part B deductible, Part B excess (100%), foreign travel emergency, at-home recovery, extended drugs ($3,000 limit), preventive care. As you move backward through the alphabet, you lose coverage in a variety of ways.

I think you get the idea. It goes from there till it’s all taken away except the basic coverage.

I must add a disclaimer. I tried to be as factual as I could and explain clearly. But as you see, the situation is complicated and varies from place to place and company to company. Specific arrangements may be full of exceptions, so you must be an informed shopper. Costs and coverage vary so greatly that one should remember the caveat emptor’s sound advice, “Let the Buyer Beware.” I hope all of you will live to pay the premiums on your 100th birthdays!

This article is reprinted with permission from the Scottish Rite Bulletin (Third Quarter 1997), Valley of Santa Fe, New Mexico.

*Editor’s Note: Actual plan costs referenced by the author in the original article have been deleted since health care rates vary considerably from state to state and one geographic region to the next.


ABOUT TO TURN AGE 65?
Why not consider the NEW Scottish Rite Medicare Supplement Plan. Look for details in the mail, or call 1-800-749-6983 to request enrollment information.