MEDICARE PLANNING MEDICARE & SOCIAL SECURITY

Transcription

1 MEDICARE PLANNING MEDICARE & SOCIAL SECURITY Presented By: Jerry Snyder CFP Retirement Strategies, Ltd Parkcenter Ave. Suite A Dublin, OH Jsnyder@retirement-strategies.com

2 COPEC WORKSHOP EVALUATION Your Name: Presentation Name: Date: On a scale of 1-10 (with 10 being highest), how would you rate the following items? a. Was the information helpful? Rating = b. Was the information clearly presented? Rating = Do you have comments or suggestions for improving the presentation? Do you know of an organization that would be interested in providing COPEC presentations? organization name, contact name & number. Please provide If you are interested in a no-cost COPEC ASSESSMENT or need assistance on a personal matter, following information and we will contact you as soon as possible. please provide the Please print clearly. Phone number: Best time to call:

3 Medicare Part A: Hospital Insurance Part B: Medical Insurance Part C: Medicare Advantage (choice) Part D: Prescription Drugs

4 What is Medicare? Part A: Hospital Inpatient Hospitalization Skilled Nursing Facilities Home Health Care Hospice Part B: Medical Doctors/Providers Preventive Benefits Durable Medical Equipment Outpatient Services Medicare was never intended to pay 100% of health care costs. Medicare covers medically necessary healthcare and some preventive care. Medicare does not cover non-medically necessary services or care outside the USA in most cases.

5 2018 Medicare Amounts Part A Hospital Deductible $1,340/benefit period Hospital Copays $335/day, days $670/Lifetime Reserve Day Skilled Nursing Copay $167.50/day, days Monthly Premiums 40 or more credits = $ credits= $ or less credits =$426 Part B Annual Deductible $183 Late enrollees may incur a 10% penalty for each yr of delay Those with higher incomes may pay a higher premium Copayments generally 20% of Medicare Approved Amount Monthly Premium $134

6 Medicare 101 Original Medicare Part A and Part B + Secondary Insurance GHI, Medigap or Medicaid + Rx Coverage Part D or GHI 1. Primary Coverage 2. Secondary Coverage 3. Prescription Drug Coverage

7 Secondary Insurance Original Medicare Part A and Part B + Secondary Insurance GHI, MedSup, or Medicaid Group Health Insurance (GHI) Insurance from a former employer or union that supplements Medicare Medicaid State assistance for those with limited income and resources Medicare Supplemental Insurance Private Insurance designed to coordinate with Original Medicare

8 Medicare Supplement Insurance Plans are standardized All companies sell same plans Premiums will vary from company to company Plans A, B, C, D, F, G, K, L, M, N No Network Pay only after Original Medicare (Parts A & B) Guaranteed Issue Open Enrollment 6 months beginning with Part B effective date at age 65 or older Special Circumstances typically 63 days after loss of coverage

9 What is Medicare? Option 1 Option 2 Original Medicare Part A and Part B + Secondary Insurance GHI, Med Supp or Medicaid + OR Medicare Advantage (Part C) 1. Hospitalization 2. Medical 3. Rx (MA-PD) Rx Coverage +

10 Medicare 2018 costs at a glance If your yearly income in 2016 (for what you pay in 2017) or 2015 (for what you pay in 2018) was File individual tax return File joint tax return File married & separate tax return You pay (in 2017 and 2018) $85,000 or less $170,000 or less $85,000 or less $ Above $85,000 up to $107,000 Above $107,000 up to $133,500 Above $133,500 up to $160,000 Above $170,000 up to $214,000 Above $214,000 up to $267,000 Above $267,000 up to $320,000 Not applicable $ Not applicable $ Not applicable $ Above $160,000 Above $320,000 Above $85,000 $428.60

11 Medicare Part D All People with Medicare can get Part D May not need Part D if you have credible coverage Medicare s Prescription Drug Coverage Offered by private companies that contract with Medicare Available two ways: Stand alone Prescription Drug Plans (PDPs) Available through Medicare Advantage Plans (MAPDs) Initial enrollment is the same as Part B Open Enrollment October 15 th -December 7 th Coverage begins January 1 Other enrollment times based on circumstance All Medicare patients should review plan options each year at

12 Review Drug Plans Each Year (3 Cs of PDPs) Convenience Network Pharmacies Mail Order Options Coverage Choose a plan that includes your meds on the formulary Take the formulary with you when seeing your physicians Cost Know all possible costs!

13 Part D Costs in 2018 Average Monthly Premiums: $30 Annual Deductible: $0 - $325 Copays: 25% or flat copay amounts based on formulary Coverage Gap (doughnut hole): $3,700 - $5,000 in total drug costs Coverage Gap discounts: 55.0% discount on brand name meds and 44% discount on generic medications during the coverage gap Discounts to increase each year until gap is closed in 2020 Catastrophic Coverage: Approx. 5% copay after coverage gap Things to Consider: All plans have a different cost structure Late enrollees may incur a 1% penalty each month of the delay Those with limited incomes/resources may qualify for extra help (Limited income subsidy-lis) through Social Security Administration

14 Medicare Options Option 1 Option 2 Original Medicare Part A and Part B + Secondary Insurance GHI, Medigap or Medicaid + Rx Coverage Part D or GHI OR Medicare Advantage (Part C) 1. Hospitalization 2. Medical 3. Rx (MA_PD)

15 Medicare Advantage Available to those Enrolled in Part A & B That live within the plan s service area (county) Do NOT have End Stage Renal Disease Alternative to Original Medicare Offered by private companies to replace Original Medicare and secondary insurance Multiple options in each county Health Maintenance Organizations (HMO) Preferred Provider Organizations (PPO) Most Plans include Part D benefit (MAPD) Enrollees pay Part B premium and any other applicable costs (Know all possible out of pocket costs)

16 Medicare Advantage Open Enrollment October 15 th December 7 th Coverage begins January 1 Other enrollment times based on circumstances MA Annual Disenrollment Period January 1 st -February 14 th (first 45 calendar days of the year) May dis-enroll from a MA plan and return to Original Medicare and enroll in a stand alone Prescription drug plan.

17 Applying for Medicare Enrollment automatic if you get Social Security or Railroad Retirement benefits prior to Medicare eligibility All others must apply with Social Security (or Railroad Retirement) during their 7 month Initial Enrollment Period (IEP): 3 months before your 65 th birthday Month of your 65 th birthday 3 months after your 65 th birthday If you are covered under your (or your spouse s) current employer group health plan, you may delay enrollment into Medicare Part B

18 Helpful Contact Information Social Security Administration Medicare.gov MEDICARE OSHIP

19 Social Security When Should You Start Receiving Retirement Benefits?

20 Definition of Terms PIA FRA FICA Credits

21 When Should You Start Receiving Retirement Benefits? At your full retirement age? Before your full retirement age? After your full retirement age? Age As early as age 62 As late as age 70

22 What Should You Consider? Your full retirement age Amount of your future benefit Life expectancy Continue working? Other income Income taxes How spouse might be affected

23 What Is Your Full Retirement Age? Your full retirement age is the age at which you can receive a full (unreduced) Social Security retirement benefit. If you were born in Your full retirement age is and 2 months and 4 months and 6 months and 8 months and 10 months 1960 or later 67

24 How Is Your Benefit Calculated? Highest 35 years of earnings are indexed then averaged.

25 How Much You ll Receive: Taking Benefits Earlier Can start benefits as early as age 62 You ll receive 25% to 30% less at 62 than at full retirement age Benefits received for a longer period of time

26 How Much You ll Receive: Taking Benefits Later You receive delayed retirement credits, up until age 70 Benefit is increased 8% for each year you postpone receiving benefits past full retirement age

27 Monthly Benefit Comparison: 62, 66, 70 Benefit at age 70 is 76% more than benefit at age 62 But cumulative benefits from age 62 to 70 equal $129,600

28 How Long Will Retirement Last? According to the National Vital Statistics Report, a 65-year-old man can expect to live, on average, to 83 and a 65-year-old woman to 85. According to the SSA, 1 out of 4 retirees will live past age 90 and 1 out of 10 will live past age 95.

29 Do You Plan to Continue Working? Are you under full retirement age? Have you reached full retirement age? Earnings from a job will reduce your Social Security benefit. Earnings from a job will not reduce your Social Security benefit.

30 How Working Affects Benefits Before full retirement age $1 for every 2$ that earnings exceed annual limit - $17,040 in 2018 Year you reach full retirement age $1 for every $3 that earning exceed annual limit - $45,360 in 2018 At or after full retirement age Earnings will not affect your benefit

31 Will Your Benefit Be Taxable? Up to 50% of benefit may be taxable if your combined income* is: $25,000 to $34,000 and you file as single $32,000 Up to 85% to of $44,000 benefit and may you be file taxable as married if your filing jointly combined income* is: Over $34,000 and you file as single Over $44,000 and you file as married filing jointly *Combined income = adjusted gross income + nontaxable income + ½ of Social Security benefit income

32 What Retirement Income Will You Have?

33 How Will Your Decision Affect Your Spouse? How can you maximize household income and survivor s income? What s the appropriate combination of claiming ages?

34 Retirement/Spousal Benefits Retirement benefits based on your earnings record-- at full retirement age 100% Spousal benefits based on your earnings record--as much as 50% Reduction for filing for spousal benefits early-- spouse can t file until retired worker files

35 Survivor s Benefits Surviving spouse generally receives the greater of the retirement benefit the worker was receiving or his or her own benefit Survivor s benefits may be payable as early as age 60, subject to reduction

36 The Choice Is Yours You may decide to take benefits earlier if: You need Social Security income right away You want to invest your monthly benefit You want to delay having to take funds from other retirement vehicles Your spouse wants to delay taking benefits You may decide to take benefits later if: You want a higher monthly retirement benefit You want to maximize survivor s income You plan to work longer You re able to file for spousal benefits first, then switch to your own benefit later

37 Contact the Social Security Administration Get benefit estimates: Contact Social Security at least 3 months before you reach age 62 Apply online, by phone, or in person

38 QUESTIONS???

39 Disclaimer IMPORTANT DISCLOSURES Retirement Strategies, Ltd. is a Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where Retirement Strategies Ltd and its representatives are properly licensed or exempt from licensure. No advice may be rendered by Retirement Strategies, Ltd. unless a client service agreement is in place. Retirement Strategies Ltd. does not provide tax, accounting or legal advice. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. This presentation or resource is solely for informational purposes Presented By: Jerry Snyder CFP Retirement Strategies, Ltd Parkcenter Ave. Suite A Dublin, OH Jsnyder@retirement-strategies.com