You obviously know the way to San Jose – but do you know the way to protect yourself from the threat of rising medical costs and increasing gaps in Medicare coverage? Generally speaking, Medicare is a decent healthcare plan but it comes with conditions and gaps in coverage that can result in you facing devastating medical costs. Coinsurance, copays, deductibles and no drug, dental or vision care are elements of Medicare that have left many California seniors who rely exclusively on Original Medicare in desperate financial condition. But there are options. You have ways to avoid the gaps of Medicare. Take a few minutes now and become aware of what you can do to protect yourself and give yourself some peace of mind.
Facts and Figures
- There are 122,584 senior citizens living in San Jose right now
- There 10 hospitals in the San Jose area where seniors can get emergency and/or in-patient care
- 40% of California seniors have a Medicare Advantage Plan
- 12% of seniors have a Medicare Supplement (Medigap) plan
- Which leaves 48% of seniors potentially uninsured or underinsured against costly Medicare coverage gaps!
Age has a way of sneaking up on us. Intellectually we know we are not as strong or physically capable as we once were. But it’s not something we dwell on or even admit until we spend a particularly busy weekend visit with the grandkids. About then, when our legs ache and we are feeling muscles that haven’t been worked in ages, we admit we might not be indestructible. The fact is, the older we get the weaker our natural defenses become. We are more likely to develop chronic diseases like arthritis and high blood pressure, more likely to fall and seriously hurt ourselves, and of course, we are more likely to need more frequent medical attention than we did when we were younger. In fact, you might be surprised at the prevalence of chronic disease affecting seniors in San Jose. Check out the chart below to get an idea of how many of your peers have chronic conditions. Surprised? You shouldn’t be. There’s no running away from nature.
|Disease||Prevalence in San Jose|
|High Blood Pressure||23%|
|Coronary Heart Disease||4%|
Healthcare Costs in San Jose, CA
Aside from having the ailment, there’s a very real financial downside to chronic conditions. They can’t be “cured” but they can be controlled. Controlling them costs money and that cost isn’t going to go away. It’s going to persist just like the disease. In fact, you may want to consider them as “chronic” costs. More bad news. Your chronic costs not only will continue, but trends indicate they will go up the older you get. And then there’s the fact that we will be getting older than our parents and grandparents. Thanks to a host of improvements in the way we live our lives, we are living longer. That’s good news so long as you can afford to keep up with the medical maintenance required. So, do you have a plan to handle this eventuality? Do you have a drug plan? Most of the “controlling” of chronic diseases is accomplished with pharmaceuticals and we all know what direction the cost of those is going.
|Disease||Prevalence in San Jose||Annual Cost of Treatment|
|High Blood Pressure||23%||$288|
|Coronary Heart Disease||4%||$10,315|
Medicare Advantage Savings in San Jose, CA
Medicare has some serious gaps, and they know it. To help retirees address those gaps, Medicare authorized the formation of Medicare Advantage (Part C) plans with the hope they might pick up some of the shortcomings. Medicare Advantage plans are provided by private companies and at a minimum, provide the same coverage as Original Medicare. But most offer much more. Medicare Advantage companies contract with Medicare who pays them a flat rate for every subscriber they enroll. Receiving a flat rate motivates the insurance companies to keep you as healthy as possible to minimize dollars spent on “reactive” medicine like hospitalization and surgeries. As a result, they focus on preventive medicine and wellness programs. The net result is they offer more services than Medicare, most notably a drug plan. In addition, because Medicare is paying them, they can often offer their coverage for zero premium (but not in all cases).
We briefly discussed the costs associated with chronic diseases and identified the cost of drugs as being a major contributor to that cost. There are of course other costs like testing strips, glucose monitors and other minor medical equipment required for “controlling” chronic disease. Medicare Advantage plans view these costs as preferable to paying for a major event like a heart attack or an amputation that might occur if the patient didn’t have the drugs and equipment needed to control the condition. As a result, Medicare Advantage plans offer pharmaceutical programs with minimal deductibles. Medicare doesn’t. The preventative approach not only improves the quality of life but reduces the overall cost of having the condition. Take a look at the chart below and see what these chronic diseases average in cost over the years. It’s comforting to know you don’t have to face that with a Medicare Advantage Plan.
You already know that your need for dental and eye care doesn’t go away just because you cross that magic age of 65. Teeth and gums are weaker and your eyes are not as sharp as they once were. You need Dental and vision healthcare. Medicare, and Medigap (the other alternative to Medicare) don’t offer it. Medicare Advantage did a cost benefit analysis and decided that paying for dental exams, cleaning, and filling, and paying for eye exams and lenses, was more efficient than paying for heart attacks, falls, and auto accidents. As a result, most Medicare Advantage plans offer dental and eyecare benefits. Those benefits are not provided in Medicare and because its coverage is directly tied to Medicare, Medigap (Medicare Supplement plans) can’t.
Medicare Supplement (Medigap) Savings in San Jose, CA
Some Medigap plans are designed to assist with the very expensive out-of-pocket costs associated with age related kidney and heart diseases. The treatments and lengthy hospital stay associated with those diseases can quickly run up a hefty bill for uncovered costs. Drugs associated with the treatment are covered but have a 20% coinsurance requirement. And then there’s the deductible that’s charged the moment you’re admitted. There are serious gaps in both the hospitalization (Part A) and services (Part B) Medicare coverages. Medigap plans (there are 10 to choose from) address many of those gaps and depending on what your condition is, can minimize your financial exposure to uncovered costs. Check out the chart below to see the average cost of these diseases. Doesn’t it make sense to have insurance that can pick up this bill?
As mentioned, there are 10 different Medigap plans approved by Medicare. These plans may have overlapping benefits but there will be something unique about each one. The idea is to provide enough options to meet the needs of a growing and diverse population of seniors. Most plans offer to cover gaps in both Part A and Part B but there are four – plans A, D, K and L – that principally provide coverage for Part A (hospitalization) with no or partial coverage for Part B. These policies might be appropriate for very healthy seniors or seniors with minor medical issues. These policies are designed to cover the “big, unexpected event” like a heart attack or auto accident that require hospitalization. A healthy senior, particularly one that has the resources to handle Medicare copays, may not need or want to pay the expense of Part B coverage for services.
By now it’s probably obvious that relying on Original Medicare alone for your healthcare insurance can be a very risky proposition. There are many gaps in coverage and copays and coinsurance requirements can rack up uncovered costs very quickly. There are 10 Medigap plans authorized. While some offer limited, focused coverage, most, including B, C, D, F G, M, and N offer full or partial coverage for both Part A and Part B. The idea is to find the one that best fits your personal healthcare situation. As a point of interest, the high deductible low cost Plan F will not be available beyond 2020. What we would strongly suggest is that you speak to a licensed agent in San Jose who specializes in senior healthcare coverage to assist you in selecting the right plan.
Because Medigap is tied directly to the benefits offered by Original Medicare, it can’t offer coverages that Medicare doesn’t offer. This would include a prescription drug plan, a dental health plan and vision care. It doesn’t take a medical expert to understand that in our “pill for everything” healthcare environment, drugs represent a significant, and usually persistent, expense. Dental and eye care are quality of life issues as well as health issues but because Medicare offers no benefits, unless the problem is associated with a covered disease like age related macular degeneration or injury, Medigap can’t provide the benefit. There is a way to get around this but it costs more. Part D of medicare is a prescription drug plan sold by private companies requiring a monthly premium. There are also private insurance companies in the San Jose area who cover all or some dental procedures and policies for eye exams and glasses.
So, to recap: if you are approaching 65 or you’re enrolled in Medicare today, you are facing some serious challenges. Rising medical costs are one of the biggest financial challenges that seniors will face during their retirement years. There are ways to protect yourself but it’s complicated. While you will need help in choosing the plan that’s best for you, you can come up with a budget that you can handle for acquiring the insurance you need. What we strongly suggest is you start shopping for coverage right here on Medigap.com. That exercise is going to put you in touch with experts who can assist you in selecting the best route for your individual circumstances. Do it now!
|Medigap Plan||Minimum Monthly Premium||Maximum Monthly Premium||Average Estimated Monthly Premium (Part B Premium Included)|
|Plan F (high deductible)||$21||$74||$183|