Your Guide To Medicare Part F
One of the most expensive supplements to Medicare is the Medicare supplement plan part F. Although it is expensive, it is also extremely popular because it gives the insured the most coverage. The following article addresses how this coverage can help you get the medical treatment you need and more. Continue reading to learn everything you need to know about this supplemental plan.
The reason most people choose a supplemental plan to their Medicare is to ensure that they can receive the necessary treatment they need at a price they can afford. Supplemental plans cover the gaps in coverage; thus, many people refer to this coverage as Medigap.
Medicare Supplemental Part F may have deductibles of up to $2,000 making it one of the most expensive. However, once you have met your deductible, this insurance begins picking up where Medicare drops off.
Medicare supplement plan F offers co-insurance for Part A and B of Medicare. This insurance covers the co-insurance of Medicare Part B; however, it doesn’t cover preventive physician visits. Medigap covers up to three units of blood per year and up to 365 days in the hospital. Additionally, you should know that Medicare Plan F covers you when you are traveling out of the country. It will cover travel emergencies that arise while traveling abroad, making it perfect for the active senior.
Many insurance companies offer supplemental insurance policies for Medicare; therefore, it is important that you shop around. When comparing policies, don’t concentrate solely on the price of the coverage. Instead, look at the coverage offered along with the price. If you get the insurance and then decide that you cannot afford it, you may not be able to get the coverage again. With this type of supplemental policies, you must qualify for the coverage if you let the policy lapse.
As you can see there are several things to consider when shopping for Medicare supplemental policies. Compare prices through different insurance policies, along with deductibles and coverages before deciding on a supplemental insurance policy. When it comes to insurance, it is always better to have too much insurance than not enough insurance.
Medicare And Medicare Supplemental Insurance
If you know even a little bit about insurance, you realize that insurance carriers set their pricing based on the perceived risk of who or what they are insuring. The higher the chances that the beneficiary will need to make a claim, the higher the insurance premium is going to be set at. Logically then, it only makes sense that insurance companies would want to charge a higher premium to seniors for health insurance. After all, are we not more likely to need healthcare services at a higher frequency in our senior years than in our younger days? This is where the idea of Medicare came from. It was created to help senior citizens in the United States acquire health insurance at a reasonable price. Without it, many seniors would be unable to afford health insurance.
Although Medicare does help alleviate much of the health care costs seniors would face, it does not provide comprehensive coverage. There are many areas where coverage is not provided. These are called “gaps”. To further assist seniors, the government also created Medicare supplemental insurance, also widely known as Medigap insurance.
Medicare is administered and issued by the government, while Medigap plans are overseen by state governments, but issued by private insurers. Today, every state except for Minnesota, Wisconsin, and Massachusetts mandates that insurance carriers can provide any combination of 10 standardized plans. That is they can offer one, two, or all of the plans if they choose to. The 10 standardized plans offer the same coverage from state to state. An individual who purchases one of the available California Medicare supplements is going to have the exact same health coverage as someone purchasing the same Florida Medicare supplement.
Because all of the plans are standardized, it is one of the rare cases in the insurance business where a consumer can actually compare apples to apples when they receive quotes from different carriers. The only decision a consumer has to make is based on price and the carrier’s reputation for service.
The states of Minnesota, Wisconsin, and Massachusetts have elected to standardize their own versions of the Medigap plans. They are similar, but not exactly the same as the 10 plans standardized across the rest of the United States.
The cost of the plans will be based on the age, gender, overall health, and location of the consumer purchasing the coverage. Seniors just turning 65 or signing up for Medicare Part B for the first time can enter into a plan during the Open Enrollment. For these 6 months, individuals have the opportunity to enroll in a Medicare supplemental insurance plan without any type of health screening. This means that even if an individual has a serious health condition or has a lifestyle that normally would cause an insurance provider to raise their monthly premium to extend health coverage, the individual is going to pay the same premium amount for coverage that a perfectly healthy person would be charged. A smoker, for example, is going to find it beneficial to enroll during this time. If they do not, they may face paying a much higher premium or not being extended coverage at all. Insurance providers must offer supplemental insurance coverage and cannot reject anyone for their health conditions during Open Enrollment.
With the 10 plans available to combine with Traditional Medicare coverage, a person can have just a few of their coverage gaps covered or nearly all of them covered and not have to worry about out-of-pocket expenses for health care.
Medigap Plan F, Pros and Cons
At the same time, all of the cost accumulated with the F Plan is up front. What does this mean for you? It means that all of the expense is built into your monthly premium instead of in high deductibles, co-pays and other methods of cost sharing (i.e. sharing a percentage of the final bill, usually as much as 50%).
Typically. Medicare subscribers have Part A, dealing with your hospitalization, long and short term and Part B, covering your medical expenses. The Medigap Plan F covers all of both Part A and B. Completely! This may not seem significant until you factor in the cost of co-pays, and cost sharing that other plans are subject to.
This plan is often times referred to as the ‘Cadillac’ of Medicare Supplement plans. With the F Plan nothing other than your monthly deductible will ever come out of your pocket. With that being said, its always best to understand what is covered and what isn’t.
For the discerning health care consumer, its always important to weigh cost vs. benefits. Ask yourself, does the cost equal benefits? Can I afford some cost sharing or a yearly deductible? As great as the F Plan is, not everyone can afford a Cadillac.
Medicare Advantage Plans
Privately-run Medicare plans, known as Medicare Advantage plans, have become more popular over the years. Their current enrollment has stretched to well over 10 million seniors, compared to 5.4 million seniors that were enrolled in these plans in 2005. Although more and more people are purchasing Medicare Advantage plans, they are not the right healthcare solution for everyone.
These private healthcare plans combine physician and hospital services into one, many times providing extra benefits like vision and/or dental coverage. Rather than paying doctors and hospitals directly like with traditional Medicare, the government pays plans to manage care under the Advantage program. There are some downsides to these plans, so you must research the options thoroughly before making a choice.
Start by determining your options. The federal government’s comparison site helps you find plans offered in your area, or you can get directly in contact with an agent on one of the many websites online offering Medicare Advantage plans.
In the event you find that there are no Medicare Advantage plans offered in your region, traditional Medicare will be your only option. Traditional Medicare allows you to use any doctor that accepts Medicare. You will have a set deductible, and then be responsible for a portion of the cost after that. If you are going with the traditional route, you should consider a Medigap policy to help with the out of pocket expenses. Some of these policies will also help with items not covered by Medicare like emergency care abroad.
If considering a Medicare Advantage plan, make sure you understand what the plan offers. The Medicare site offers quality ratings as well as some general information, but you may want to check sources like your state’s health insurance program, or SHIP.
There are a few types of MA plans. Most plans manage care to control their costs. Like other HMOs and PPOs, they rely on networks of doctors, so it is wise to verify that your physicians and the hospital that you prefer participate in that particular network.
Be sure to question their policies when it comes to referrals. Will they allow you to see specialists without a referral from a primary-care physician? When it comes to a PPO, find out how much you would have to pay to see doctors who are not in the network. You may at some point find yourself in need of a physician when out of town, and finding one in your network may not be possible.
Many MA plans have additional benefits. Some will cover eye exams, dental care, and even hearing aids. Make sure you understand all the coverage and whether or not it includes all of the traditional Medicare benefits.
Once you understand what will be covered, it is time to start evaluating the cost. Advantage plans often offer lower premiums than traditional Medicare and Medigap plans. They can be good options for a healthy individual. An Advantage plan though can be a worse deal if you are in a situation where you need frequent hospitalizations and other care for chronic illnesses. A few other things to consider are the deductible as well as the out-of-pocket maximum you will be responsible for in a year
The last thing to review before making your decision is how the plan will work with your current benefits, if you have any. If you have retiree benefits, get in touch with your former employer to find out if you would have to forfeit those benefits if you left traditional Medicare.
Medicare Advantage plans are not standardized like Medigap policies, so reviewing plans from different providers can take a little more time. Be sure you fully understand what you are buying before enroll in a plan.
A Little About Medicare
If you are 65 and transitioning to Medicare from traditional insurance can be a frightening time for those who are used private health insurance. The truth is that making the move to Medicare can be easy and comforting if you know what to expect.
The Parts of Medicare
The First step in understanding your Medicare Coverage is to realize that there are parts and plans. The Parts of Medicare have been developed as a part of federal legislation. Each Part covers a different part of potential health care expenses. Part A is designed to help with in-patient hospital, skilled nursing, and hospice care. Part A is provided at no charge for most people but does have both a deductible and coinsurance.
Part B is designed to help with out-patient care and doctor’s office visits. A little simpler than Part A, Part B has a monthly premium, a deductible and ongoing coinsurance of 20%. So once you pay the deductible you are responsible for 20% off all the Medicare approved charges that your doctor charges.
Part D is a partnership between the federal government and private insurance companies. This part of Medicare covers prescription drugs. The price of the plans is determined by what medications you require. For most people the plans will average between thirty to sixty dollars per month.
While none of these parts are comprehensive coverage they do provide significant savings. Both Part A and Part B can become comprehensive by adding one of the Medicare Supplement plans, also referred to as Medigap plans.
There are ten Medigap plans in all. They will cover at least four and as many as all nine of the gaps left by Medicare Part A and Part B. Supplement Plan F is the most comprehensive covering all of the gaps and Plan A is the least only covering four. The plans are made to be standardized by letter so if you are looking at Medicare supplemental insurance plan F from three different companies the coverage will be exactly the same even if the price is different. By getting one of these plans you can make sure that you will not be stuck with a big bill when you do need to use your Medicare insurance.
By arming yourself the knowledge of the different parts and plans associated with Medicare you can make sure that you are getting the best coverage for your needs.
Is Medicare Supplemental Insurance Right for Me?
While looking at a supplemental plan, it is necessary to run the numbers. Some seniors may not require extra coverage or cannot justify the cost. The reality is the solid majority of retirees should seriously consider a supplemental policy to cover the extra expenses they may incur. In the end, most retirees would be smart to invest in a strong policy that covers all of their needs that Medicare neglects to cover. Remember, the decision is not just a financial decision.
Why It’s Important to Buy Burial Insurance
You may not know much about burial insurance. Or, you have heard that it is similar to regular life insurance. But, the truth is the two do indeed differ. Burial insurance solely pays for the costs of the funeral. When it comes to finding the right policy for covering funeral expenses in the event of your death, there are many choices available. Whichever you choose, know that you are taking a huge burden off your family.
It is never pleasant to think about death, but if you were to pass away, you want your loved ones to be able to pay for your funeral costs, of course. You would be surprised at how much these costs can add up to and without burial insurance, your family could really be put in financial chaos. Having a solid burial insurance plan will prevent such a financial crisis for your family.
Getting Burial Insurance
When it comes to burial insurance, people often opt to not sign up; they believe it is something that they can put off because they are young or in perfect health. However, anything can happen to you; death is not just for the old and sick. This does not mean you will die tomorrow, but it is good to be prepared. So, putting off getting a policy is not such a wise idea.
Even if you are not in a great financial state at the moment, you can still probably get burial insurance. Most policies are rather affordable and should work well with your budget. Consult with a good insurance agent about burial insurance to discuss which plan is best for your finances. If need be, you can get a cheaper policy for now and when more money comes your way, you can upgrade to a better one. Just remember that your family’s financial well-being after your death is worth whatever you need to pay.
Accessing Affordable High-Risk Life Insurance Coverage
Finding affordable and adequate life insurance cover has become a nightmare to many today. Although it may be hard to find quality life insurance cover, it doesn’t mean there aren’t any companies offering the same. Some insurance companies do provide high-risk life insurance policy to all who need it.
High-risk life insurance cover may seem unaffordable to low income earners. The tips and facts discussed below however proves otherwise.
High-risk life cover is mainly accessible though specialized insurance companies/agencies. These companies have packages that accommodate persons over the age of 50 years and those with chronic ailments. They take it as their responsibility to help these persons by availing affordable life insurance to these persons. These individuals need this insurance cover the most and no one else.
Finding the Right High Risk Life Insurance Policy
The first step to finding these policies is to talk to the life insurance agents at InsureNow365. The agents will evaluate what your condition is, then advice on the best and adequate life insurance policy to take. The insurance brokers can also help you find an affordable cover that accommodates your budget for the same.
Giving these agents as much as possible is the only best way these agents can help you. This means you will have to disclose your health condition and budget to them, as this will ease their job in finding the best-fit policy for you. Their professional help will help land you an easy to manage insurance cover hence peace of mind.
Skilled and experienced insurance agents should always be considered especially when searching for quality and affordable life insurance cover. Your age or health status should not be an obstacle for these agents, and they should be able to work something out to get you what you need with time. This is the reason why patience and trust is needed while working with them, and they will find or work out a suitable life cover for you.
Is Life Insurance Available to Someone With Diabetes?
If you have a chronic illness like diabetes, it can be scary to think about trying to get life insurance. After all, insurance companies typically base their rates and premiums on risk. How much of a risk is it to insure this person? It would seem like insuring someone with diabetes would be a pretty big risk since diabetes increases your chances of developing other complications, like heart problems. However, assuming that insurance companies only base their premiums on risk is a very simplistic way of looking at it. Believe it or not, there are a lot of life insurance options for diabetics.
Life Insurance for Diabetes
Overall, there are a lot of things that insurance companies do to help people with diabetes get insurance. For example, almost all life insurance companies will take a look at a person’s medical history over the past few years. They will see how that person has managed their blood sugar and if there have been any other problems. If that person has kept their numbers in check and has not had other problems related to diabetes, then they would be classified as a very low-risk diabetes sufferer.
The main thing to remember is that just because you are suffering from diabetes does not mean that you cannot get life insurance. What it really comes down to is how well you take care of yourself. Whether you have diabetes or not, life insurance companies are going to take a look at what the risk is to insure you, and your premium is based off that. If you have diabetes and you do not take care of yourself, then yes, your rates will be higher. However, the same can be said for people who do not have diabetes. Diabetes is not stopping you from getting life insurance, so go out there to find the right plan for you!
Life Insurance: A Decision For You And Your Family
A very effective and loving method of caring for your family is to buy a life insurance policy that will be in effect when your pass. Many people feel that this focusing on the morbid,and death is not something that we should be thinking about, but the purchase of life insurance allows us to be very proactive in a positive way by caring for those whom we love. Without the proper life insurance, a family can be left destitute at a time when they are already grieving enough. The following lists some important points to assist you when planning for this important financial decision.
When you are planning for the amount of life insurance to purchase, you should remember to include the amount of coverage you should have for both cash needs, and recurring needs, or income. You will be calculating costs for mortgage payoffs, final expenses, educational expenses, car payoffs, and emergencies. For income, it is a safe policy to calculate for about 70% of current income because you will not be paying taxes on the life insurance income, if it is set up properly. If you want a good estimate of how all of this works out, a short way of doing this would be to take your current salary and multiply it by 8, and you will be pretty close to a figure that will make sense.
Be sure that you ask the right questions when visiting with your life insurance agent. Find out if you are buying term life insurance, if it is convertible or not, and which of the best life insurance companies he works with. Term runs out eventually, but you may want to continue some or all of the coverage later. Convertibility guarantees that possibility. Find out if you can cancel the policy, and if so what are the ramifications. Are there any exclusions?
Find out all you can about permanent life insurance. It is the kind that creates a cash value in the policy. Compare the growth in the policy with other investments. Perhaps that could be a way to help save for college or even retirement. In any case, learn all you can and stay within a budget amount that you can afford, and you will be better able to keep it in force. Be glad that you have taken this step, for if something were to happen, your family will be able to stay in their own financial world.
The High Cost of Dying
It’s been said that there are only two things that you can depend on: Death and taxes.
The one is a certainty, and the other nearly so for most people.
And I suppose that given a choice, most people would choose to pay their taxes.
But, what about those who are left behind? What financial burdens can a grieving spouse or other relative expect to incur?
That’s not something that most of us think about. Instead, we imagine that that there is a rich uncle somewhere in the family tree who will leave us all his money; and then we can live happily ever after.
We never stop to think that it could us that end up footing the bill, because the estate of our dearly departed was insufficient to cover the cost of dying.
So just how bad can it be?
Here’s a list of the main items. It makes for some grim reading.
Cremation – $1,500-$4,000. Depends on whether the arrangements are made through the crematorium or the funeral home.
· Casket - $1000 and up. Some are as high as $30,000! It depends on the material they are made from.
· Embalming – $225 to $1220. Not all states require it provided the funeral takes place within a couple of days.
· Funeral home fees (includes viewing, a ceremony, graveside services, the use of a hearse) – $1750-$4,800
· Headstone – $200 and up. The engraving is extra. The lowest price is for an engraved, flat, stone about the size of a legal pad, only thicker.
The cost of the grave space and digging the hole is extra, and varies between cemeteries.
Then there are the extras: flowers, more than one hearse if the family is large, or there are a number of close relatives, and publishing the obituary in your local newspaper can be an additional expense.
Conservatively, a funeral would cost at least $3,000, and if you had to make expensive decisions such as the type of casket while you were in mourning, your expenses could inadvertently go through the roof. That’s because funeral homes, while providing a service, are in the business to make money. And they have a reputation for taking advantage of people when they’re vulnerable.
That’s where final expense insurance can save your day. It can help to take the emotion out of another otherwise difficult situation.
For one thing, the person buying the insurance may well be the same one who eventually is in the coffin. And if that is the case, then he or she is more likely choose the least expensive option than his or her relatives.
The other thing is that that person won’t be coerced into buying services that are neither necessary nor required while grieving.
Both of those factors can contribute to your inability to think clearly and make sensible financial decisions.
The cost of final expense insurance varies widely depending on the policy. Check with a local provider for more details.
Understanding Your Credit Score
An individual’s credit score is one of the most misunderstood things I have ever found in personal finance, yet it is one of the most vital things to understand to stay in good financial health. Believe it or not, many people think that things like income and paying your utilities on time impact your credit score. They do not. Here are 5 things that do impact your credit.
1) Payment history. This accounts for 35% of your credit score. It has a bigger impact than any other single factor. If you pay your creditors on time, this will have a big impact on your score. If you do not, you are likely to see your credit score plummet. If you do have any late payments, the best thing to do is stay current. The longer you pay on time, the older those late or missed payments become and the less impactful they will be on your credit.
2) Debt. Your debt makes up 30% of your score. Nearly the same as your payment history. Some debt is okay, but too much can hurt you. Credit card debt is especially impactful. High credit card balances, maxed out credit cards, and too many accounts with balances can all drive your score downward.
3) Length of credit history. This accounts for 15% of your score. It takes a look at your track record of having credit accounts and managing them well. The longer you have had credit, the better. Recently opened accounts or little to no history can have a negative effect on your score. The only thing that can fix this is time.
4) New credit. This makes up 10% of your score. Every time you put in an application for a new credit account, an inquiry will post to your credit report showing your activity. Excessive shopping for credit and too many inquiries on your credit report in too short of a time period will hurt your score. Inquiries stay on your credit report for 2 years, but only those in the last 12 months are counted towards your credit score.
5) Credit mix. The type of credit you have makes up the final 10% of your score. Having a healthy mix of credit cards, auto loans, and mortgages will help your score. Having too many or only one type of account can actually hurt you in this category. Diversity is beneficial.
These are the primary factors impacting your credit score.
Overdraft Protection, but Protecting Who?
I recently opened a new checking account. When I did so the banker asked me, actually strongly encouraged me, to sign up for what they called “overdraft protection”. The way he described it was that if I was out to eat and did not realize that there was not enough money in my bank account to cover the mean, by default, my debit card would be declined. However, if I opted into the overdraft protection, the bank would allow the purchase to go through, and I would be charged a $35 fee.
As I declined the service, I pointed out to him that would also mean if I bought a $2 pack of gum at a convenience score with less than $2 in my account, that $2 pack of gum is now $37.
He seemed rather shocked, and even annoyed, that I pointed out the absurdity of this “service”. He continually argued that the bank was offering it as a favor to me and other customers.
Am I missing something here? Is this something I should have looked at harder?
Thanks, But No Thanks
Dear Thanks, But No Thanks,
In my opinion, you made a good decision. In the wake of the financial fallout a few years ago, new legislation was passed in 2010 that changed how overdrafts were handled. Before this new legislation, almost all banks enrolled customers into “overdraft protection” automatically. They would allow customers to spend more money than what was in their accounts. Each transaction in the negative would be charged a fee ranging from $24-40 at most institutions.
Your example of the $2 pack of chewing gum, while it may seem humorous, was all too real. When I worked for one of the major banks, we saw customers all the time with not just one such transaction, but many such transactions. Racking up $250 or more in overdraft fees in just a few days was quite common. Now add in there the number of student age customers that had no idea how to balance their checking account and rarely kept track of their balance, and you can just imagine how much money banks were making off of these fees.
To sweeten the pot for themselves, many banks also would post debits daily in order from largest to highest. The way they justified this was by saying that larger payments were probably more important things such as a mortgage, rent, or car payment, so it was more important that those things got paid instead of rejected. In reality what it did was allow the banks to collect even more in fees.
Imagine a customer with a balance of $1275. Over the weekend, their mortgage payment ($975), a purchase at the grocery store ($165), a little shopping for some clothes ($125), a fill up at the gas station ($43), dinner with friends ($29), a movie afterwards ($13), and a stop by the local coffee shop on the way to work ($8) all come through the account. Under the system of posting from highest to lowest and assuming their bank charges $35 per overdraft, they were looking at $140 in overdraft fees. If they posted from lowest to highest, there would be one overdraft, at $35.
After the new legislation, customers opening new accounts are not enrolled into overdraft protection by default. A customer has to request the service, and even sign a form saying in writing that they were requesting it. The order in which items are posted to an account and what can be charged an overdraft fee were also regulated.
Bankers will use that story about being at a restaurant and your card is rejected (even if you balance your account regularly, everyone can make a mistake from time to time) and you have no other method to pay the bill. Sure this can be embarrassing, but the reality is that they are just trying to get you to opt in because this was a huge loss of revenue for banking institutions. They are trying to recoup as much of it as they can. There are better, and cheaper solutions.
One option is to have a second account in which you keep a small balance of $50-100 that links to your primary account just for such a situation. You can also open a credit card to use just for emergencies. Even at some of the ridiculous interest rates that some credit cards charge, this is a far cheaper option than allowing the bank to overdraw your account.
I see no reason for anyone to opt into this service. It is simply a money grab by banks.
Difference Between APR and APY
What is the difference between APR and APY? I see both advertised, but never know what the difference is.
I spent 8 years working for a major bank and can tell you that you are far from the only person confused by these two rates. Both APR (annual percentage rate) and APY (annual percentage yield) are used to describe the interest rate paid on something. The difference between the two is in how the interest is applied.
APR is simply the annual interest rate that is paid on an investment. It does not take into account how the interest on your investment is applied. APY, on the other hand, does take into account how the interest is applied to the balance.
Let’s say that you deposit $10,000 into a 12-month CD that has an APR of 5%. If interest is only applied once per year, you would earn $500 in interest after one year.
In another example, let’s say the interest is applied to the balance on a monthly basis. In this case, it is said that the interest compounds monthly. The 5% APR would be broken down into twelve interest payments for each month, which would be about 0.42% each month. Your $10,000 CD will earn $42 the first month. That interest is then credited to the balance, and in the second month you earn 0.42% on the new balance of $10,042. This continues on each month throughout the year.
Even though the APR is 5%, with the interest compounded monthly, you would see almost $512 of interest after one year. The APY is 5.12%
APY’s are advertised so that you can compare deposit offers from bank to bank. With different rates and maturity terms, it would be difficult to compare products from different institutions without the APY. This is why banks and other financial institutions are required to disclose the APY on such products.
Remember if you have the interest on a CD paid out to you on a regular basis, you will not be receiving the APY. You will be receiving the APR because the interest is not compounding.