February 21, 2017
A Bigger Bite Out of Social Security
Most retirees didn’t notice the $5 cost-of-living increase in the average Social Security check. That’s because the Part B Medicare premium deducted from their checks went up nearly as much (from $104.90 in 2016 to an average $109 this year).
Beyond premium hikes, the bigger issue for retirees are the additional out-of-pocket costs they must pay as part of their Part B coverage for doctor visits and outpatient care. When rapidly rising copayments are added to the basic premium, they together consumed more than 15 percent of the average Social Security benefit last year. That is more than double the percentage in 1980, and it’s expected to exceed 17 percent by 2030, according to the Centers for Medicare and Medicaid (CMS).
The CMS estimates were made prior to the announcements of 2017’s final COLA and Part B increases. But the trend of eroding benefits was confirmed by Juliette Cubanski, associate director of Medicare policy for the Henry J. Kaiser Family Foundation. …Learn More
January 31, 2017
Good Health Insurance is What Counts
Having health insurance is no guarantee that medical care is affordable.
Some families, despite being covered by the Affordable Care Act (ACA) or employer policies, say that high premiums and deductibles mean they can’t afford to see a doctor. This distinction – between having insurance and receiving care – will be crucial as Congress considers proposals for ACA’s replacement.
One comprehensive 2003 study demonstrates how individual medical decisions change when they receive one longstanding, and what the researchers called “generous,” type of insurance: Medicare. Their study focused on changes in the use of the health care system – more so than improved health – by comparing people who’ve recently gone on Medicare with people a couple years away from turning 65 and becoming eligible. The analysis adjusts for the fact that some, though not all, people under 65 have employer coverage and that many people also retire around this age, sometimes receiving special retiree health benefits.
Once people turn 65 and are on Medicare, the researchers found that:
- The probability of seeing a doctor at least once a year increased, based on data from the National Health Interview Surveys, which track the frequency of routine medical care.
- Medicare eligibility led to a “surprisingly large” 5-10 percent increase in hospitalizations in California and Florida, particularly among white Americans. The increase was driven by elective surgeries such as joint replacements and heart bypass surgeries.
- There were large increases in preventive care for less-educated whites, such as getting flu shots and cholesterol tests, based on analyses of the Behavioral Risk Factor Surveillance System, which tracks preventive care use.
- Minorities, who are at much higher risk of untreated high blood pressure, were more likely to receive this diagnosis after going on Medicare. …
January 12, 2017
Financial Stress Rings in the New Year
Having dug ourselves out of the worst financial crisis since the Depression, the nation entered 2017 amid rising wages and record-low unemployment. Yet three out of four adults report being “financially stressed.”
And no wonder: half of the 2,000 adults in the December survey by the National Endowment for Financial Education (NEFE) said they are living paycheck to paycheck.
Americans’ specific financial issues are routinely documented in this blog and run the gamut from cash-flow shortages to poor retirement prospects.
The primary sources of financial stress identified in the NEFE survey were not enough savings and too much debt. This was consistent with a second finding in which respondents said that solving these issues would also provide the most “financial relief.” Here are the other findings: …
November 8, 2016
On-the-Job Healthcare Costs More
We’ve passed a milestone: workers typically spend more than 10 percent of their incomes for their employer health coverage.
A decade ago, they spent 6.5 percent on health costs.
One reason for the rising cost burden is the growing prevalence of high-deductible insurance plans, and, within these plans, the deductibles themselves are increasing. Although premium hikes in employer plans have slowed in the past five years, they are also still going up. The nation’s aging work force could be another indirect pressure on costs.
Workers’ incomes have also been going up, but growth remained sluggish over the past decade and “have not kept pace” with employer health costs, the Commonwealth Fund reported.
Healthcare news in recent weeks has focused on the 2017 premium hikes hitting people who buy coverage on the state exchanges created under the Affordable Care Act. But 154 million Americans – more than half of U.S. workers – obtain health insurance through their jobs, compared with about 10 million who go through the exchanges, points out the study by the Commonwealth Fund, a healthcare research organization.
When premiums and deductibles are combined, health costs are really starting to bite: the typical family shelled out about $6,422 in 2015 for premiums and copayments, compared with $3,531 in 2006 – that’s increasing much faster than the pace of inflation – the report estimated. No wonder one recent survey found only a minority of Americans satisfied with the cost of their health insurance plans.
In the Commonwealth Fund’s state-by-state analysis, the level of incomes in a state seem to play a role in the weight of workers’ healthcare burdens. For example, premiums and deductibles, as a share of workers’ incomes, currently exceed 12 percent in low-wage states like Arizona, Florida, New Mexico, Oklahoma, and Tennessee – Mississippi’s, the highest, is close to 15 percent of incomes. Workers in relatively well-off states such as Maryland, Massachusetts, and Washington, however, pay 7.9 percent, 7.3 percent and 8.5 percent of their higher incomes, respectively.
To examine the study’s state-by-state analysis, click here.Learn More
October 18, 2016
Fewer, Clearer Medicare Part D Choices
A decade ago, the nation’s Medicare enrollees had more than 1,800 different prescription drug plans to choose from. In the 2017 open enrollment that started on Oct. 15, that number dropped to just 746.
News of higher Part D drug plan premiums and out-of-pocket costs in 2017, estimated in a new report by the Henry J. Kaiser Family Foundation, will not be welcome by the nation’s older population. But Squared Away also wanted to know whether fewer plan options are good or bad for consumers.
“It’s good in the sense [federal] efforts are bearing fruit in giving people options that are more distinct from each other than in the past,” said Juliette Cubanski, Kaiser’s associate director of Medicare policy. At the same, she said, retirees “still have a lot of choice in this marketplace.”
The number of plans has shrunk steadily for a variety of reasons since the 2006 inception of the prescription component of Medicare, known as Part D. In the early years of the program, plans started disappearing amid consolidation among insurers and pharmacy benefits managers, she said. More recently, a few Part D plan providers have pulled out of the market.
But Cubanski said recent reductions in the number of plans were primarily by federal design. In 2011, the Centers for Medicare and Medicaid (CMS) stepped in and began requiring insurers that offered more than one Part D plan in a region to make sure the differences among their plans were clear and distinct to Medicare beneficiaries. …Learn More
October 13, 2016
Medicare Enrollment Help is Plentiful
Open enrollment starts Oct. 15 for people who’ve signed up for Medicare and must buy into or change their supplemental Advantage or Part D prescription drug plans.
The Medicare Rights Center in New York tells me that you can “make as many changes as you need during this period” and that “only your last coverage choice will take effect Jan. 1.”
A long list of resources appears at the end of this blog to help Medicare beneficiaries through the enrollment process. But there’s a lot of hoopla around the Oct. 15-Dec. 7 enrollment period, so it’s important to know what Oct. 15 is not about.
One’s birthday – and not a date on the calendar – determines when people should initially enroll in the Medicare program. Most people turning 65 who are not covered by their own or their spouse’s employer health insurance at work are required to enroll in Medicare Parts A and B during a seven-month period that starts three months prior to their 65th birthday. During this seven-month window, new Medicare participants must also sign up for their Part D drug plans – or risk paying a lifelong penalty. Oct. 15 is not the trigger date for selecting Medigap plans either.
Here’s what the Medicare open enrollment that starts Oct. 15 is about: figuring out the right Advantage or Part D drug plan to buy or switch to. This is a complex process that involves multiple choices, anticipating your future health care needs and expenses, and a lot of research into the plans available.
It’s an implicit recognition of Medicare’s complexity that so many resources are available to help with this process, from private and government-funded consultants to YouTube videos and detailed web pages on the Medicare website. The following resources and blogs can help answer your questions: …Learn More
August 11, 2016
Medicare Advantage: Know the Pitfalls
Baby boomers on Medicare are streaming into Medicare Advantage plans, with nearly 18 million people currently enrolled in them.
But a new study identifies pitfalls that might not be obvious to those signing up.
Advantage plans are HMOs or PPOs that provide both basic Medicare Part B coverage and many of the benefits offered by supplementary Medigap insurance policies. But Medicare beneficiaries’ premiums for an Advantage plan plus Medicare Part B coverage are roughly half, on average, of the premiums for a Medigap policy plus Part B.
One reason is that Medigap policies typically cover more out-of-pocket costs. Another is that insurers offering Advantage plans assemble networks of hospitals and physicians to control their costs and reduce customers’ premiums.
But, the researchers point out, Advantage plans frequently limit “access to certain providers and increase the cost for care obtained out-of-network.”
In nearly half of the 20 U.S. counties examined in a new study by the Kaiser Family Foundation, Advantage plans had limited networks of hospitals, potentially increasing consumers’ costs. Further, a large majority of Advantage plans did not include their county’s top-quality, high-cost cancer treatment center in the networks of approved health care providers.
And it can be very difficult to compare access to care and the future out-of-pocket medical costs that will result from a decision to go with an Advantage plan. Costs vary greatly among Advantage plan networks, with coverage often described in complex, incomplete, or confusing insurance plan documents, Kaiser said.
Consumers also face a dizzying array of choices. One example: In Cook County, which includes Chicago, eight difference insurance companies are selling 19 Advantage plans with 10 different provider networks.
Many retirees learn the ins and outs of the network only after they try to access medical care under the plan. The Kaiser report’s key findings provide a roadmap of things consumer should watch for: …