Question

I'm in a pickle. My Baby Boomer parents are on the verge of turning 65. They just received their copy of Medicare & You in the mail from the Centers for Medicare and Medicaid Services at the Department of Health & Human Services. It's time for them to think about a bunch of new things that happen when you turn 65, like signing up for Medicare and starting to collect Social Security. The latter seems like a relatively easy straight-forward decision. Since both of them have worked throughout their lives and recently retired, all that is needed is to decide at what age they will start taking those retirement benefits. Medicare is a whole different story. I do know that they paid Medicare taxes while they were employed, so they should be eligible. Also, since they have recently retired, they will not have health care coverage once their COBRA benefits run out. They are currently paying $1,300 per month to retain their medical coverage. Now that I think about it, it may make sense for them to enroll in Medicare before COBRA runs out. My parents have had their health insurance with Anthem Blue Cross/Blue Shield through my dad's employer and have stayed with this under COBRA for the last 6 months; they have 12 months left on that coverage. They have each used the same primary care physicians for many years, but their doctors are also Baby Boomers and are on the verge of retiring as well. Dad has diabetes and needs regular care and good coverage for his medications. Mom is in pretty good health, but needs annual check-ups, mammograms and the like, and is also on a couple of medications for cholesterol and other things. Plus, you never know when something will go wrong and they'll need more care. My siblings and I want to make sure they have good coverage, so I am thinking that this may be a perfect time for them to change their coverage. But, I am at a loss about what to do. Unfortunately, I don't know anything about health insurance beyond my own family's policy and benefits, and I know absolutely nothing about Medicare. And, unfortunately, my parents seem to be in shock that they have reached this point in their lives and aren't really paying attention to these issues.You are a health care management student. I understand that you have some knowledge in this area. Can you help me by answering the following questions and making a recommendation about which way my parents should go? And, can you make sure to explain your rationale of making your recommendation, so that my siblings and I can discuss this with our parents and help them make the decision that will be best for them? 1. Given my parents' medical conditions, do they need Medicare Parts A, B, and D? Be sure to include: (a) an explanation of each of these Parts and (b) your rationale for whether my parents need each Part based on their specific condition(s). 2. What about Medicare Part C? Do you think a Medicare Advantage plan might be a good option for my parents? If so, what type do you think would be good? 3. What are the cost considerations for the various Medicare options? 4. How does the cost of Medicare compare to what my parents are currently spending for their COBRA coverage? Will going on Medicare sooner rather than later save them money? 5. What is your recommendation to us for my parents' coverage?

Answer 1

1. ANS: The Parts that would benefit your parents would be A, B, and D. This is because your father has Diabetes and may need to be hospitalized and he needs a drug plan for his medication, and your mother will need preventive care plus a drug plan also.

2. ANS: Part C may be a good plan because it gives them the option of additional plans such as the prescription drug plan.

3. ANS: The cost considerations depend on their income, if they are a wealthier they pay a higher percentage that range from 35 to 80 percent of their deductibles, coinsurance, and balance billing. Premiums could be 25% of Part B benefits and 25.5% of Part D benefits.

4. ANS: Having Cobra coverage is very expensive, I think that going on Medicare sooner would be the better and yes it would save them money. Right now, they are paying $1,300 a month for their Cobra coverage and with Medicare coverage it would be cheaper.

5. ANS: My recommendation is for them to enroll in Medicare because it will give them thecoverage that they need at a cheaper rate.