No matter your age, the topic of insurance can be a complicated one, but this is especially so when it comes to healthcare for older adults. While Medicare is a reliable option for those who qualify, those who don’t receive employer-sponsored coverage and who are not yet eligible for Medicare find themselves in a tricky situation -- a gap in insurance coverage. And with all of the recent changes involving the future of the healthcare industry, finding the right insurance before Medicare to ensure you remain covered can become even more difficult.
Although it can get complicated, remaining educated about all the issues that factor into a decision when it comes to healthcare for older adults is an essential step in protecting both your health and wallet. In order to help you stay healthy over 50, we’re breaking down two recent changes in healthcare and how they may affect you.
Issue: Insurers Are Leaving the ACA
From national health insurance carriers, like UnitedHealthcare and Humana, to regional carriers, many insurers have pulled out of the Affordable Care Act (ACA) Exchanges over the last two years. Why? The costs for insurers are simply too high.
To help us better understand this issue, we spoke with Annette Bechtold, SVP of Regulatory Affairs and Reform Initiatives at OneDigital, the nation’s largest benefits broker.
“While the ACA put in safeguards to help offset costs for participating carriers who took on a disproportionate amount of risk, only a very small percentage received the reimbursements they anticipated,” said Bechtold. She went on to explain that this was one of the main reasons we are seeing the carriers exit the Marketplace. This, coupled with many of the ACA’s market rules and processes, have led to the high rates and instability of this marketplace. These provisions and practices include: the ineffectiveness of the individual mandate penalty to drive all individuals to obtain health coverage; new market rules mandating certain levels of coverage for all insurance plans; and the ability for individuals to "game the system" and only pay for insurance coverage for the months they will use the coverage.
Without enough healthy people in the insurance market to balance out the costs of those with medical needs, consistent protection of policy holders, and more flexibility in policy design, both carriers and participants face escalating costs that result in the choice to exit the market.
“Multi-million dollars were lost and not reimbursed,” said Bechtold. “The bottom line is that no company is in it to lose money, so they’re leaving.”
How This Affects You: If you are not on Medicare and do not have employer-sponsored coverage, know that there is a very real possibility that counties in certain marketplaces may have limited or no insurers in their Exchange in 2018. These limited options will result in some difficult decisions for you and your family. And if you are forced to switch plans, you may not have many options to choose from; some marketplaces may have only one option available.
Issue: Insurers Are Raising Premiums
Insurers aren’t the only ones, however, feeling the pressure of heightened costs. In order to cover the cost for claims, insurers are raising premiums by as much as 50 percent, which can be a strain on your bank account. Unfortunately, older adults are affected the most by this increase, causing many of them to resort to unreliable options for insurance before Medicare.
Robert Fitzgerald, owner of Robert Fitzgerald Insurance Agency, Inc., helped walk us through the potential consequences of purchasing unreliable insurance coverage while waiting for your Medicare to kick in.
“Some have stopped buying individual health insurance and are instead simply using health sharing plans,” says Fitzgerald. “Even though it’s about a quarter of the price, it’s not real insurance, and it’s pretty risky since there’s a cap on how much they’re actually going to pay, meaning you could be caught without anyone to pick up your claims.”
How This Affects You: The raise in premiums directly affects the cost of care, as well as the quality of and the access to care. Due to high premiums, some are turning to Health Maintenance Organization (HMO) plans because out-of-pocket medical costs and monthly premiums are typically lower.
“But many HMOs have skinnied their network so much that it’s almost like a Medicaid plan,” says Fitzgerald. “Now, you might have one to two hospitals you can go to, but that wasn’t how insurance was three years ago.”
What You Can Do
Now that you know the big issues that play into decisions when it comes to healthcare for older adults, you next have to take actions to safeguard both your health and your wallet. Luckily, there are plenty of ways you can find the best insurance before Medicare.
There’s unfortunately a lot of confusion out there surrounding Medicare, but there doesn’t have to be, according to Bechtold. “If you’re going to turn 65 soon, Medicare.gov will be one of your best resources along with a knowledgeable insurance professional. Medicare.gov tells you everything you need to know, like when you need to sign up and how you enroll.”
Bechtold also notes that it is a popular misconception that everyone is automatically enrolled in Medicare. It’s up to the individual to make sure you know what you have to do to enroll and stay healthy over 50.
Look at ALL of your options.
While Medicare is the most popular form of healthcare for older adults, it certainly isn’t the only option available to you, which is why Fitzgerald suggests taking the time to research all of your options. And there are quite a few to consider. Between Medicare, a group plan (especially since more Baby Boomers are returning to work post-retirement), military benefits and even federal government resources, you’re bound to find the option that’s best for you.
Hire a broker.
If you’re still unsure which plan is best, consider hiring a broker to help you get the most appropriate insurance before Medicare. Not only will they be a great source of knowledge to you regarding healthcare for older adults, but they’ll also help you assess which options best suit your needs.
The best part is that brokers typically provide free consultation since they are paid by the insurance carrier, and there are even resources available to you to help you find a broker. The National Association of Health Underwriters, for example, is a premier benefits broker association dedicated to guiding consumers like you through purchasing and enrolling in healthcare.
Be a better consumer.
In today’s fast-paced society, it can be easy to simply take everything for its face value, but Bechtold argues that you should question everything when it comes to your healthcare. “Challenge those who are setting the prices. We spend more time negotiating when we purchase a car than when we purchase our own healthcare.”
Know how to stay healthy over 50.
Maintaining an active and healthy lifestyle is essential as you age, especially since your lifestyle can have a huge impact on how much you spend on healthcare.
“In a lot of cases, the two symptoms most associated with high insurance claims are smoking and being overweight,” says Fitzgerald.
Exercising often, eating a healthy diet, keeping your mind active, quitting smoking, limiting alcohol consumption and even socializing with friends are all key components that will help you stay healthy over 50 and help keep your healthcare costs down as you age.
Medical Guardian: A Different Kind of Insurance
Although insurance and healthcare for older adults can be complicated and may change over time, one thing will always remain certain: insurance is designed to be there for you when you need it most. Even though you may not always feel as though you need it, it’s an essential element that will help you stay healthy over 50 and prevent you from experiencing crippling debt in case of a medical emergency.
Medical Guardian’s medical alert systems are designed the same way. You never know when a debilitating fall or medical emergency will occur, but you can rest assured knowing that your safety is guaranteed in every situation, day or night, thanks to Medical Guardian.
OneDigital Health and Benefits, the nation’s largest company providing employee benefits for employers of all sizes, represents the new generation in health and benefits. Focused on creating harmony between people and technology, OneDigital delivers market-leading benefits solutions and is the only company offering a sophisticated combination of strategic advisory services, analytics, compliance support, technical innovations and HR capital management tools to employers. Headquartered in Atlanta, Georgia, OneDigital has offices throughout the country and serves 35,000 companies and manages nearly $4 billion in premiums. The company has been named to the Inc. 5000 List of America’s fastest-growing companies every year since the honor’s inception in 2007.
Robert Fitzgerald Insurance Agency, Inc is a completely independent insurance agency specializing in Medicare Solutions. We work with the top insurance companies so we can offer our clients the best coverage for them. Our clients are located all across the Southeast, giving us a great feel for the financial landscape. We design plans with a focus on risk management, low costs, and tax-efficiency, which we combine with personalized financial advice aimed at helping clients make better informed decisions.