Posted by: David Forbes | August 3, 2009

Medicare Advantage Plan Non-Renewals Equal Opportunity

Many Medicare Advantage plans will not renew for 2010

When an insurance company contracts with CMS to offer a Medicare Advantage plan, it is for one contract year at a time. In addition, the contract is on a County by County basis. Each year an insurance company can assess the profitability of renewing their Medicare Advantage contract in each of the Counties that they have enrolled members.

On first glance, it would seem that this would be a terrible inconvenience for current Medicare Advantage members. The members of a non-renewing plan will have to look at the various Medicare Advantage plan options and choose a new plan for the following year. But this is exactly how it was intended. If a plan provider can offer a new plan and secure a new contract, it doesn’t mean that the benefits will be or have to be the same as the previous year. It also means that plan premiums can increase.

It only makes sense that you should review your plan coverage each year. This doesn’t necessarily mean that you will change plan providers, but  letting your current carrier renew your coverage may not be your best option. If the plan can change, you need to know what’s changing. If your plan is renewing for the next year, do your homework and make sure that you are getting the best plan for your situation.

The opportunity of a non-renewing plan

If your current plan notifies you that they are not going to offer a plan for the following year, it is not a problem. You should have been reviewing plan options each year anyway. To see all plans available in your County, go to the Medicare website and do a search for Medicare Advantage plans. It’s important to do your homework and not just fall for the first plan that comes your way.

Here’s the opportunity. You now have a guaranteed enrollment period for Medigap coverage, commonly known as a Medicare Supplement insurance policy. Insurance companies that offer Medicare Supplements must offer you a guaranteed enrollment opportunity if you are a member of a Medicare Advantage plan that is non-renewing. You have the right to buy, Medigap plan A, B, C, F, K, or L that is sold in your State by any insurance company. You can apply up to 60 calendar days before the date your coverage will end, but you must apply no later than 63 days after your coverage ends.

This is a fresh start to have guaranteed  coverage in a Medicare supplement policy. No matter which company you decide to apply with, the plans are standardized. This means that the choice is much easier to make. You don’t have as many coverage options from one plan to the next. Plan F with Mutual of Omaha is the same as plan F with AARP. Companies can offer extras, such as a nurse hot line or vision coverage, but when it comes to the core supplement plan, the coverage is the same.

Making your choice

You are in the same position whether your Advantage Plan is going to renew or not. But if it’s not going to renew, you have the additional option of a guaranteed issue Medicare Supplement plan. If you choose the Supplement option, given the standardized coverage, it comes down to three things:

  1. How you feel about the company (customer service, etc).
  2. Which company has the best price.
  3. Do you want a local agent or one from a telemarketing call center.

Call a local agent or agents and ask for quotes. Get referrals from friends about how they feel about their Medicare Supplement insurance company and choose the one that you believe will offer you the best long term value.

 

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Posted by: David Forbes | July 29, 2009

How to Avoid the Top 5 Mistakes When Creating a Living Will

Avoid these mistakes when creating a living will

You have no excuse for not creating a living will to make your end-of-life wishes known. You can download a free printable living will that is specific for your State. But there are several things that you can do wrong when creating your living will. I have isolated the top 5 mistakes that are made after someone downloads a free printable living will. Hundreds of people who received living will forms were surveyed to isolate these mistakes as those that are most commonly made.

The top 5 list

1. Believe it or not, about 1 in 6 people that download living will forms never fill them out! If this wasn’t so prevalent I wouldn’t include it in the list. This is a no brainer. You download the forms, then you take some time to read and understand what’s required, then you fill them out! Don’t procrastinate. This is too important.

2. Another common mistake is not taking the time to understand the questions asked. All States have slightly different forms and procedures to be followed, but understanding common definitions is important so your wishes are followed. An example would be understanding the difference between these 3 statements: 1. I have a terminal condition. 2. I have an end-stage condition. 3. I am in a persistent vegetative state.

You may want life prolonging procedures withheld or withdrawn in all or only in some of the above listed conditions. Understanding the difference can make a big difference in having your wishes carried out.

3. Make sure that you sign your living will and if one or more witnesses are required, have them sign as well. If your State requires that your living will is to be notarized, make sure that you follow through.

4. A vitally important part of creating a living will is choosing the right health care surrogate. Make sure that you talk to your surrogate about your wishes and ask them if they have any issues related to acting on your behalf. Also, consider naming an alternate surrogate who can step in if your primary surrogate is unable to act on your behalf. In addition to choosing the right health care surrogate, make sure that you stay in touch. Consider changing your designated surrogate if your relationship changes. An example would be that your chosen surrogate becomes a former spouse. You don’t want that person deciding whether or not to pull the plug!

5. Have several copies of your living will made and distribute those to your surrogates, your family, close friends and your health care provider. Keeping the original without distributing copies will do you no good.

Don’t stop with a living will

Everyone needs a last will and testament. But everyone doesn’t need to pay an attorney hundreds of dollars for the service. Attorneys don’t run off to the law library and research the nuances of wills or start from scratch when they need to prepare the forms. Attorneys understand that every case is different, but in many circumstances a State specific template is sufficient. It’s a fill in the blanks exercise.

Some enterprising attorneys who didn’t want to merely trade their time for money, created State specific templates and made them available for a small fraction of the cost. Now, if you are Bill Gates or Warren Buffet, this may not be your best choice. Or, if you think that World War Three will break out over your Earthly possessions, you may want to spend hundreds or thousands of dollars in attorney’s fees.

If you want to save hundreds of dollars and get a will – you need to know about this resource

You can download living will and power of attorney forms absolutely free. Now here’s an opportunity to get your Last Will and Testament taken care of for a small fraction of the cost that an attorney would charge for the same thing. If you can read and fill in some blanks, this is a no brainer!

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Posted by: David Forbes | July 26, 2009

Why Retirement Planning is Your Personal Responsibility

Now is the time to think about retirement planning

It would seem obvious to most of us that retirement planning is our personal responsibility, but following through and taking action is what determines our success. This is no different than most aspects of life. Having knowledge is certainly a starting point, but taking action is the difference between merely thinking and living.

Now is the time to take action. It doesn’t matter whether your 45 or 65 years old. Everyone needs to start from where they are at. I often hear people that are newly retired or just about to retire complaining about their financial situation. You always have options and have the ability to make choices based on the facts at hand. Conversely, I meet many people in their forties and fifties that are so caught up “just paying the bills” that they cannot even think about retirement planning let alone take action. These are the same people who have to buy the latest and greatest and put on the appearance that they are successful. Now is the time to assess your situation no matter what your age, and take some purposeful action to ensure your financial future.

Don’t count on Social Security

Social Security is not a retirement plan. I’m not even going to guess when Social Security is going to become insolvent.  One thing is for sure, the demographic landscape in the United States is changing.  As the population ages, there will be more and more people entitled to Social Security. What’s not for sure is whether there will be any money for you. Here’s a question: What would your standard of living be like without a monthly Social Security check? I know that after working and paying your taxes it wouldn’t be fair, but  receiving a monthly check is not guaranteed. 

Here’s an exercise: Pretend like Social Security doesn’t or will not exist for you. What are your options? This may never come to pass. Maybe the Federal Government will tax our children and grandchildren into submission so we can continue to receive Social Security. But what if that doesn’t happen?

Here’s a starting point

  • Start a conversation with a financial planner now.
  • Have your past 5 years taxes reviewed by a independent CPA to determine if your are entitled to a refund due to any accounting errors. Done normally on a contingency basis.
  • Look at all of your insurance coverage to see if you are over paying. Consulting an insurance agent is normally a free service.
  • Take a look at Long Term Care insurance. It could be the difference between financial independence and Medicaid.
  • Max out any employer matched benefit plans, 401K etc.
  • Take the time to detail all of your monthly expenditures. Cut any non-essential expenses.
  • Start an automatic savings plan. Something is better than nothing.
  • Let a mortgage professional review your situation. You may be able to lower you interest rate and save a substantial sum.
  • If applicable, take a look at what a reverse mortgage could do for you.
  • Down size your expenses. Take a look at your expenses and ask if it’s a need or merely a want.

 Don’t wait to take personal responsibility

Now is the time to take a look at where you are at and where you would like to be. Don’t count on anything that is not in your control. In most cases, the action points listed above don’t cost you any money and what you could learn may have a significant impact on your finances. It’s all about taking action. Nobody is going to do it for you. Retirement planning is your personal responsibility.

 

 

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Posted by: David Forbes | July 22, 2009

What Your Attorney Doesn’t Want You to Know About Preparing a Last Will and Testament

You need to prepare a last will and testament

There are some things that you need to know about preparing a Last Will and Testament. First, you need to know that it’s necessary and second, you need to know that you have options when it comes to preparing your Last Will and Testament. When most people think about preparing a Will, they automatically assume that it involves meeting with an attorney and paying several hundred dollars in fees. Meeting with an attorney for Will preparation, generally involves the attorney asking you questions about your assets and liabilities, how your assets are to be distributed and to who and who is going to be the executor of the estate. The document is then drawn up and in some cases delivered to you in an official looking binder enhancing your perception that you got several hundred dollars in value for your attorney’s efforts.

I’m not an attorney

No. I’m not an attorney, but I know that in most cases , the attorney is not going to the law library and spending several hours studying the nuances of how the Will should be crafted and formatted. More often than not, a State specific template is used that includes all the relevant aspects of a Will. When you meet with an attorney, she doesn’t go out of her way to let you know that she is asking questions that are typically required to fill in the template any more than the the manager at the fast food restaurant is letting you know before you order that your burger was cooked previous to your arrival. It just doesn’t enhance the perceived value of the service.

Here’s the disclaimer. If you are Bill Gates or Warren Buffet, this article is not for you. If you are expecting World War Three to break out over your worldly possessions, this article may not be for you. But if these situations don’t apply to you, and saving a few hundred dollars is important, then you need to know…..

There’s the what, now here’s the how

Some very enterprising attorneys who didn’t want to just trade their time for money, created State specific Last Will and Testament templates and made them available for sale at a small fraction of the price normally charged for the service.

If you are able to read, write and answer some questions about your situation, then you should have no trouble navigating a Last Will and Testament template. There are many times that retaining an attorney for services are necessary and prudent. You should think about the complexity of your individual situation. If you believe that your circumstances are fairly straight forward, then considering a State specific Last Will and Testament template, may be right for you.

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Posted by: David Forbes | July 13, 2009

Medicare Supplement Policies offer the Best Insurance Value for Seniors

The value of a Medicare Supplement policy

The value of Medicare supplement policies have been demonstrated over their 40 year history. In general terms, a Medicare supplement or Medigap insurance policy picks up where Medicare leaves off. Medicare’s unpaid portion of claims are the responsibility of the Medicare beneficiary.  Medicare was never intended to pay all medical claims, but instead, pay a large portion and offer a huge safety net to seniors.

The beneficiaries responsibility includes a hospital deductible ($1068 for 2009) and generally 20% of Medicare’s allowable charge for outpatient services and any excess charge levied by providers. Given the cost of health care, the responsibility can be substantial.

Medicare supplement polices vs. health insurance at age 64

Here’s the reality. On average, when you turn 65 years old and are in your guaranteed enrollment period, you can buy a Medicare supplement for under a $100 up to $180 per month, depending on the plan and the State that you live in. Think about it. This same person, at age 64, before they were Medicare eligible, could have had an individually underwritten health insurance policy that could have cost anywhere between, $250 and $800 per month (and you don’t get much for $250). Or maybe they retired a little early and had Cobra coverage from their previous employer. In this case, they could have been paying from $500 to over $1000 per month. The other possibility for the same person would have been an employer subsidised health insurance policy. Given how employers are cutting back, the premium more than likely would have been more than a Medicare supplement. Many seniors breathe a sigh of relief when they become eligible for Medicare and can lower their health insurance costs with a Medicare supplement.

Medicare supplement vs. Medicare Advantage plan

Don’t get me wrong. I’m not saying that Advantage plans don’t offer value. They do, in certain circumstances. These are some times when you may need to consider a Medicare advantage plan:

  • You are on Medicaid and can get an Advantage plan for being Dual Eligible.
  • You cannot afford the premium for a supplement.
  • You don’t have a qualifying enrollment period and can’t qualify due to a health issue.

If any of these circumstances fit you, then you should consider a Medicare Advantage plan. Many Advantage plans either have no monthly premium or a low monthly premium so they are often affordable. They also only have one health question that relates to end stage renal failure. If you are on Medicaid, you may qualify for a Dual eligible Advantage plan.

How to buy a Medicare Supplement policy

There are several ways to buy a Medicare supplement policy.

  1. Meet face to face with a trusted insurance agent.
  2. Apply through the mail.
  3. Apply over the phone.
  4. Complete an application on line.
  5. In some cases you can sign up through your former employer.

If you want to have a go to person, and you don’t have the former employer option, I would recommend that an Insurance agent is involved. Whether face to face, by phone or having an open communication online. If you call a 800 number, you are speaking with someone who you will probably never speak with again. A trusted local agent gives you a real person to go to in the event that you have questions or need some help.

Whether you shop online or call your long time insurance agent, you are getting a great value with a Medicare supplement. If you don’t want to be nickled and dimed with co-pays, a Medicare supplement is the way to go. Medicare supplement policies offer the best insurance value for Seniors.

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Posted by: David Forbes | July 10, 2009

Why it is Smart to Name an Alternate Health Care Surrogate When Preparing a Living Will

Why an alternate health care surrogate is a smart move

When preparing a living will, name an alternate health care surrogate.You’ll be glad you did. Almost 80% of Americans have not prepared a living will and an even greater percentage of those that have taken the time to prepare a living will haven’t named an alternate health care surrogate. But they need to. Naming an alternate could be the difference between whether or not your end-of-life wishes are followed. Most medical power of attorney forms include the option of naming an alternate health care surrogate. These are the main reasons why naming an alternate health care surrogate is a smart move:

  • You end-of-life situation may be due to an accident and not a predictable long term illness. If this is the case, you will double your chances that one of your health care surrogates will be available to interact with medical staff.
  • Medical care and the choices that need to be made in a fluid situation can be complicated and two heads may be better than one.
  • Your relationship with your health care surrogate may have changed. A common example is naming your spouse and not changing your choice of a surrogate after a divorce. This would give your alternate the ability to step forward and speak on your behalf.
  • You are attempting to keep peace in the family and naming more that one health care surrogate is a means to that end.

These situations illustrate why you need to name an alternate health care surrogate. If you already have a living will, it may be time to dust it off and review your choices. Its not too late to add an alternate surrogate. When you update your living will or medical power of attorney, that revision will supersede the previous draft.

Get free printable living will forms online

You don’t need to pay an attorney to prepare your living will, nor do you need to pay for the forms. Get your free living will forms online and keep your money in your pocket. Your living will forms come with complete easy to follow directions. Once you get your forms, take some time to contemplate your end-of-life wishes and complete the forms. Choose your health care surrogate and alternative surrogate and make sure they understand your wishes. Keep the original and give copies to your health care surrogates as well as close family, friends and your physician.

Preparing a living will is the right thing to do and its smart to name an alternative health care surrogate. This is just one less thing to worry about so you can Retire as Planned.

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Posted by: David Forbes | July 8, 2009

The Dilemma in Choosing A Private Fee-for-Service Medicare Advantage Plan

Medicare Advantage Plan Defined

So what is the difference between a Medicare Advantage plan and a Medicare Supplement? The government’s official definition of a Medicare Advantage Plan is:

“A plan offered by a private company that contracts with Medicare to provide you with all your Medicare Part A and Part B benefits. Medicare Advantage Plans are HMOs, PPOs, or Private Fee-for-Service Plans. If you are enrolled in a Medicare Advantage Plan, Medicare services are covered through the plans, and are not paid for under Original Medicare.”

In plain English, Medicare pays an insurance company to administer Medicare on your behalf. You must have parts A and B and cannot have a Medicare Supplement.

A Medicare Supplement or Medigap policy is an insurance policy that picks up, to varying degrees (based on plan selection), what original Medicare does not cover. A premium is paid directly by you to the insurance company.

Now Back to Our Story

Medicare’s definition of Advantage Plan includes three types of plans. These include HMOs, PPOs and Private Fee-for-Service Plans. Here’s the bottom line; HMOs and PPOs are plans with a provider network. HMOs being more restricted than PPOs. With PPO, you can save money by using providers in network, but are generally allowed to go out of network and pay a little more.

The private fee-for-service Advantage plan deos not utilize a network. You can go to any provider that accepts Medicare assignment and accepts the plans terms and conditions. A provider can choose on a visit by visit basis whether or not they will accept the plan.  An exception is made in the case of emergencies.

The Dilemma

You see the dilemma. Do you choose a network based plan and accept the providers that are available? Or do you take your chances and go with the private fee-for-service plan?

Choose the network based plan if:

  • The network is substantial and you feel comfortable with provider choices.
  • Your Doctor is in network and you are not willing to make a change.
  • You find that the network based plan has lower out of pocket expenses.
  • You like the added benefits such as transportation and gym memberships.

Choose the Private Fee-for-Service plan if:

  • Your not locked-in to a particular provider.
  • You don’t mind changing providers if the one you saw ceases to accept the plan.
  • You travel frequently and don’t want to be restricted by a network.
  • You could care less about the extra benefits.

 Keep This in Mind

Whether you choose a network based plan or a private fee-for-service Medicare Advantage plan, you have enrolled in the plan for that calendar year. The plans can change from one year to the next and are not required to renew. If you have a Medicare Advantage plan it makes good sense to speak with an independent agent during your Annual Enrollment Period that runs from Nov. 15 to Dec. 31 each year to see if there is a better alternative out there. Its your right and every dollar counts so you can Retire as Planned.

 

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 Choosing a Medicare Advantage Plan.”

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Posted by: David Forbes | July 6, 2009

Is Your Poor Health Preventing You From Buying Life Insurance?

Know your life insurance options

Many people have poor health and it is preventing them from buying life insurance. Or is it? Let’s face it, we have all heard that the best time to buy life insurance is when you are young and healthy. That may be true, but don’t discount the options because of generalities. Many people are finding a solution in final expense or burial life insurance. Burial insurance offers a solution for those that are unable to qualify for what we perceive as more traditional life  insurance.

Blood pressure, blood sample, urine sample, oh my

Normally when we think of applying for life insurance, we envision a nurse taking our blood, checking our vitals and absconding with a sample of our urine. The greater the death benefit, the lower the promised premium and the longer the term all translates into more stringent underwriting.

But what if you are 70 years old, smoke a pack a day, are over weight and have type 2 diabetes? You’re out of luck, right? Nope. This is where simplified issue whole life burial insurance comes in. Burial insurance, also known as final expense insurance, is generally whole life insurance that has liberal underwriting and lower face amounts.

Answer these questions

The application process for burial insurance doesn’t require an exam in most instances, but there are a series of health questions that must be answered. Also, a phone interview may be required where a company representative can access your online medical records from the Medical Information Bureau and data base of prescription drugs. Many companies offer some policies that are guaranteed issue. You can’t be turned down within a certain age range.

But how does it work?

These are the most common features of burial insurance:

  • Rates never increase.
  • Coverage cannot be cancelled because of age or health.
  • No medical exams – just a few simple questions.
  • Whole life burial insurance builds a cash value.
  • Death benefit can be used for any purpose.
  • Generally income tax-free death benefit.
  • Issues up to 85 years old.
  • Affordable rates to cover the average funeral cost.

One unique thing about burial insurance is that you can get coverage amounts from $2,000 to $50,000. The health questions are used to determine the policy design. The first option if you’re somewhat healthy or healthy and 80 years old, is a policy with an immediate death benefit. No waiting periods – pay from day one. The next option is what is referred to as a graded benefit. It works something like this. The first year or two, if you pass away,  it returns all your paid premium plus a fixed amount of interest to your beneficiary and in the third year it is the full benefit.

You can generally shop for a quote online and in many instances, you can apply over the phone or through the mail. So, if you think that your poor health is preventing you from buying life insurance, just re-think your options. Burial insurance could be one more piece of the puzzle so you can Retire as Planned.

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Posted by: David Forbes | July 5, 2009

When is the Best Time to Prepare a Living Will?

Don’t put it off – Prepare a living will.

When I speak to groups about how strongly I feel about living wills, I’m often asked, “when’s the best time to prepare a living will.”  The short answer is now. As with so many things in life, the time is now. Some people treat the preparation of a living will as if it were the dreaded term paper from their school days. Others, amazingly, don’t prepare a living will because of some superstition or feel that “I won’t ever need one of those.” These are the same people that neglect to protect their family with life insurance.

Don’t wait until you are hospitalized to prepare a living will

I mentioned in a previous post that my wife is a RN in the critical care unit of one of the hospitals in our town. After patients are admitted and before they are barely settled in a hospital room, they are asked if they would like to prepare a living will. Not surprisingly, about 80%  of them do not have a living will.

Now, put your self in the patient’s position. You’re in the hospital. You’re in a hospital room for a reason and its probably a good one given what they do today on a outpatient basis. You may be in pain. You may be on some meds, you may be scared and you are definitely stressed. What do you think? Is this the best time to prepare a living will? Unfortunately, by default it may now be the right time, but its not the best time.

Let’s review

There is no time like the present to prepare a living will. There are plenty of websites where you can get a free printable living will. An attorney is not required. In most States, you only need to have your living will witnessed, even a notary is often not a requirement. When you take the time to think about what treatment or procedures that you want to have done or not have done, you are light years ahead than having to make these decisions when you are hospitalized. So, the question is; when is the best time to prepare a living will? Do it now. Its one less thing to worry about and you can Retire as Planned.

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Posted by: David Forbes | July 3, 2009

Don’t Miss These Opportunites to Buy a Medicare Supplement Policy – Guaranteed

The best time to buy a Medicare Supplement policy

The best time to buy a medicare supplement (medigap policy) is during your open enrollment period. Your open enrollment period lasts 6 months and begins on the first day of the month that you are both 65 or older and enrolled in Medicare part B. During the medigap open enrollment period, medical underwriting does not apply. An insurance company cannot:

  • Charge you more premium because of any health condition.
  • Refuse to sell you any policy offered in your State.
  • Make you wait for coverage to start (except a 6 month wait for pre-existing conditions if no creditable coverage was in place for the prior 6 months).

 

Other times you qualify for guaranteed issue rights

Guaranteed issue rights come into play when other health coverage that you have, changes or goes away. The following are additional opportunities to buy a Medicare supplement policy and be guaranteed of issue regardless of health conditions.

  1. You have been in a Medicare Advantage plan that is not renewing in your county or you move out of the plan’s service area.
  2. You have employer group including  cobra benefits or coverage from your union, and that coverage is ending.
  3. You have Medicare Select (supplement with provider network), and you move out the the coverage area.
  4. You joined a Medicare Advantage plan at age 65 when you became eligible for Part A,  have been enrolled for less than a year and you would like to switch to original Medicare.
  5. You dropped a Medicare supplement to join a Medicare Advantage plan, its been less than one year and you would like to switch back.
  6. The company that you have your Medicare supplement with, goes bankrupt or coverage ends through no fault of your own.
  7. A Medicare Advantage plan or Medicare supplement plan that you were enrolled in, doesn’t follow the rules or you were misrepresented.

Your right to a guaranteed issue period is not open ended. You generally must make your move within 63 days of your coverage changing. Check out  Medicare’s site to get more detailed information or speak with your insurance agent.

When your coverage changes its time to make your move

Don’t miss your opportunity to take advantage of any guaranteed issue period that you have to buy a Medicare supplement policy. Call your agent or go online and request a quote so you don’t miss your opportunity. You have the right to apply for a Medicare supplement after 63 days has passed since your coverage change, but you are then subject to underwriting and your health conditions could cost you more money or stop you from qualifying for coverage.  If you keep these opportunities in mind, you will be able to secure great coverage at the best price available.

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