Retirement Considerations for Employees Sandy Ruffo, RN.

Retirement Considerations for

Employees

Sandy Ruffo, RN

Statewide Health Insurance Benefits Advisors

(SHIBA)

• Role of SHIBA

• Handouts

• Key concepts to be discussed

Common terminology

Critical timelines and rules

Employee choices

Employer advise to

employees

The Terminology

• “Hospital Benefit”

• No cost

Eligible age 65

Disabled X 2 years

Medicare Part A

• “Medical Benefit”

• Monthly premium: $93.50 in

2007

Premium higher for incomes

over $80,000/$160,000

The Terminology

Medicare Part B

• Drug Coverage (57 plans Pierce) – offered for

Original Medicare only

• Varies by plan Formulary and price Deductibles and co-pays Coverage in gap period varies by plan Contracted pharmacies

• Untimely enrollment = penalties

Three parts (A-B-D) referred to as Original Medicare

Plans • Part C is not considered “Original Medicare”

The Terminology

Medicare Part D

• Medicare Advantage Plans – Medicare Health Plans – MC + Choice Plans (16 Pierce)

• Part B required

• In Medicare program – have MC rights and

protections

• Includes Medicare A and B benefits + may have

extras

• Drug coverage varies by plan; OOP costs vary by plan

The Terminology

Medicare Part C

The Terminology

• Insurance supplements for Original

Medicare benefits – not MedAdvantage

Plans

• OIC approved carriers (22)

• 12 Standardized Plans (A though J)

Hospital/outpatient co-insurance/co-

payments

SNF co-insurance

Part A and B deductibles

Medicare Supplements/Medigap

The Terminology

• Government Sources DSHS Medicare Savings (Part B costs) Extra Help (Part D prescription)

• Non-Government Sources

Foundations for chronic disease

Pharmacy Assistance Programs

Charities

Limited Income/Resource Programs

Drug Plan

• Employer drug plan: as good or better than Medicare

• Employer to provide employee with letter

Medigap Plan

• Health coverage employee had before applying to

Medicare

√ Not discount cards, specific disease insurance, LTC

insurance

The Terminology

Credible Coverage

Timelines to Watch

Part A Enrollment

3 Months BeforeBirthday

BirthdayMonth

3 Months AfterBirthday

• Not tied to obtaining Social Security benefits

• SSA sends info packet

Employee not auto enrolled (unless getting SS)

Rules:

If working after age 65, not mandatory

If to retiree plan, required to enroll

• Unsolicited advice

Timelines to WatchPart B Enrollment

• Critical: What is employer plan requirement? When employer plan pays – before or after Medicare?

• Employee can delay Employer coverage primary Under spouses insurance

• Rules: If working after age 65, not mandatory If to retiree plan, required to enroll

• Critical: If enrolls Triggers open enrollment period for Medigap

• If delays due to employer coverage, has 8 months

• Or 63 days after employer coverage ends

• Penalty of 1% of national average premium (2007: $27.35)

per month

Enrollment limited to Open Enrollment period (11/15 to

12/31)

Effective January 1st

• HR change plan prescription drug parameters

Ensure coverage credible; if not employee penalized

Timelines to WatchPart D Enrollment

3 Months BeforeBirthday

Birthday Month

3 Months After Birthday

Not keeping any employer coverage:

• Initiate Part A and B enrollment, then

• Enroll in MedAdvantage Plan

• Miss this period = only during Open Enrollment

period

Timelines to WatchPart C Enrollment

3 Months BeforeBirthday

Birthday Month

3 Months After Birthday

Not keeping any employer coverage:

• Part B triggers – 6 months to enroll Guarantees Pre-existing conditions

• Late enrollment Higher premium potentialAnnual Open Enrollment period

• Reminder: employer plan requires Part B =

impacts Medigap

• Medigap Protections Have employer coverage Move in and out of MedAdvantage Plans

• Leave Medigap protections – 63 days to enroll

Timelines to WatchMedigap Enrollment

Employee Choices On Retirement

• Employer Retirement Plan

Consider benefit parameter changes;

decrease

Price

Spouse coverage

COBRA an option

Drug coverage credible

Obtain benefit book

Employee Choices On Retirement

• Original Medicare Plans Plus Supplement

Part A, B and D

Medigap Supplement

Monthly average 2007: $254

Employee Choices On Retirement

• Medicare Advantage Plans (Part C)

Purchase Part B

Plan premium (with and without drugs)

Medigap insurance not needed

Monthly average 2007: $231 (for plan

which offer above Medicare)

Advising Your Employees

• Retirement before age 65 (not Medicare

eligible)

Spouse coverage needed

Employer plan cost versus individual

insurance

Disability a factor

Limited income/resource programs

Assistance with drug prescriptions

Advising Your Employees

• Retirement at age 65

Employer health plan offered

Remind: enroll Medicare Part A

Decisions made on Part B –

trigger Medigap Open Enrollment period

Drug coverage credible

Advising Your Employees

• Retirement over age 65

Timely enrollment in Part B

Decide Original Medicare or MedAdvantage

Plan

Q & A?

SHIBA Hotline

253.596.0918