medicare

Dimes for Sale: 8 for $1!

photo shows a stack of 8 dimes

You may never see an offer like this. No one would buy, right? It is too obviously a bad deal.

But people get tricked into doing essentially the same thing, all the time. Buying insurance you do not need is a lot like buying dimes, eight for a buck.

A recent retiree told us about being offered “Medicare Supplement Plans” where the one that had a potential $180 per year exposure to deductibles was $250 cheaper than the one that featured full coverage. The agent said most people prefer the “better” policy, desiring full coverage. But when you think about it, why pay $250 to save $180?

Another told us of a proposal to buy long-term care insurance, which sometimes makes sense. But this person supported a lifestyle that already cost more than long-term care, a lifestyle whose expenses would disappear if the need for home care or assisted living or long-term residential care emerged. A more expensive lifestyle would disappear if the cheaper long-term care lifestyle came into play. No coverage needed!

These thoughts came to mind as I cancelled a disability policy into which I had faithfully paid each month for forty years, one that would have provided needed benefits when I had large family obligations and little in the way of other resources.

Insurance is a marvelous invention. We believe in buying all of it that you need—and none that you don’t.

Otherwise, you’re buying dimes, eight for a buck.

Clients, if you would like to talk about this or anything else, please email us or call.


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The Worst State to Retire In

© Can Stock Photo / flashgun

It seems like everywhere you turn, there are opinions about retirement. We have not seen this particular bit of advice, so here goes.

After thought and study, we conclude that the worst possible state for retirement is… the state of confusion. Confusion may seriously impair the retirement experience.

• If we don’t understand the income potential of our lump sum balances, we may either be unnecessarily tight with our budget, or run the risk of winding up broke.

• Running out of money is a common and natural fear. Arithmetic guided by experience and knowledge may ease that concern.

• Decisions about Social Security benefits and pension payouts may have a large impact on financial security. The advice one gets at coffee break or at the water cooler may not be the best.

• Health care transforms for most people in retirement. Putting all the pieces together can be confusing. Medicare Part A, Part B, Part D, and supplemental insurance all enter into it. Personal health and financial factors play roles, too.

We advocate thoughtful approaches to major life decisions. A framework of solid information and the right arithmetic may help reduce confusion.

All in all, the state of confidence is a far better place to retire than the state of confusion. Clients, if you would like to discuss this or anything else, please email us or call.


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

It’s Open Season!

© Can Stock Photo / kingjon

In recent years we have learned a lot more than we ever wanted to about two things. Potentially catastrophic health situations taught us a lesson about insurance and benefits and health care providers. We aren’t the experts—we are not telling you what to do—but we do know a thing or two.

Medicare recipients face the same basic choice that many working age people have confronted. Do you accept some limitations on the doctors and facilities and treatments you might use in return for lower costs or other minor advantages? Or do you go with more expensive arrangements that give you greater choice?

Like many important decisions, this highly personal decision would be a lot easier if we had a crystal ball. If you are healthy and stay healthy, the less expensive plan saves money. But if you want or need specialized care from premier providers, the more expensive option may be more likely to cover superior choices.

(We aren’t kidding about not being experts. Consult advocacy groups or online resources or professionals in the field. This is general information only.)

A long time ago, I was confronted with the option of joining an HMO plan, back when they were first invented. At first blush, the possibility of ever being powerless to switch to the doctors and facilities I believed would save my life was intolerable. We have always paid more to have more flexibility. This is a personal preference.

Lots of times, the centers of excellence—premier health care institutions—are simply not covered by Medicare Advantage plans or HMO’s. (Know your own plan; this essay does not replace information you need about your situation!) Care at the Mayo Clinic, Cleveland Clinic, etc. is not inexpensive.

The only point we want to make is that Medicare Open Enrollment Season, when you might switch from HMO-type Medicare Advantage Plans to Traditional Medicare, runs through December 7th. If you switch in this period, you may purchase supplemental or MediGap coverage with no questions about pre-existing conditions, regardless of health.

The moral of the story is, if your health has changed for the worse and you want more choice of medical providers, NOW is the time to dig in and figure it out. Open season comes but once a year on Medicare. You might start at www.medicare.gov to begin your education.

Clients, we usually end our stories with a request to call or email us if you want to talk more. In this case, please do not! We just told you all we know. (If you are in an employer plan, not yet on Medicare, you may face a similar situation. Talk to your HR department or benefits people.)


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.