Medicare

What Medicare plan do I want?

Medicare choices are confusing — we and some of our clients call it alphabet soup. There is one genuinely good thing about it, though, that Social Security does not offer: you can change your choice later in life.

Before Goat Planning moved into retirement income planning, we worked exclusively with Medicare and life insurance clients across a wide range of incomes and situations. The choice of a Medicare plan is, unfortunately, not simple. It is also not separate from the rest of your retirement plan: your Medicare premium comes out of your Social Security check, and your income two years ago decides what that premium is.

A note on what we can say here. Centers for Medicare & Medicaid Services (CMS) regulations restrict what an agent may publish on a website. We cannot name an insurance carrier, use the word “best,” or describe specific plan benefits. With your written permission in advance — a Scope of Appointment, which CMS requires at least 48 hours before we talk — we can go much further.

There are two paths

Original Medicare

Medicare itself, plus a Supplement (Medigap) to cover what Medicare does not, plus a separate drug plan. Generally accepted wherever Medicare is accepted, and the most comprehensive of the two.

Medicare Advantage

A Medicare health plan run by a private carrier, much like an employer health plan. The premium is generally lower, but coverage is narrower and comes with co-pays and deductibles. Often includes extras such as dental and vision.

Both paths use your Medicare benefits. The real choice is between comprehensive (Supplements) and pay-as-you-go (Medicare Advantage).

How the two paths compare
	Original Medicare + Supplement	Medicare Advantage
How you pay	Pre-pay through a monthly premium	Pay as you go, often with a $0 plan premium
Where it is accepted	Any hospital or physician group that accepts Medicare	Limited by the plan’s network and your geography
Prescription drugs	Not included — a separate Part D plan is required	Usually included, though not always
Out-of-pocket costs	Plan G covers the 20% Medicare does not, per Medicare rules	Co-pays, deductibles and other limits apply
Extra benefits	Generally none beyond medical coverage	Often dental and vision; some plans for veterans or chronic conditions
How common	The traditional route	More than half of Medicare beneficiaries

Supplements (Medigap)

Supplements are offered by many private insurance companies, but the terms are dictated by CMS, so the benefits are identical from one company to the next. They are identified by letter. Plan G is the most comprehensive available today — Plan F is no longer available to new enrollees.

Supplements are designed to cover costs Medicare does not pay. Medicare generally pays 80% of costs, and 0% of drug costs most of the time. Plan G covers the 20% that Medicare does not, according to Medicare rules. There is a monthly premium, and for most services, including hospital stays, Plan G covers the cost.

Part D (drugs)

Supplements do not cover prescription drugs except in some inpatient hospital settings. You must have a separate policy for prescription drugs. Failing to take a Part D plan when you are first eligible can impose a significant penalty that lasts for life, even if you add one later.

Medicare Advantage

Medicare Advantage plans are offered and approved by CMS through private insurance companies. There may or may not be a premium, and many carry a $0 plan premium. Most, though not all, include Part D drug coverage. There are normally co-pays, deductibles and other limitations. Many plans add benefits such as dental and vision, which Medicare does not normally cover. Some plans are built for military veterans or for people with chronic conditions — again, depending on where you live.

Medicare plans vary widely by geography: state, county and city limits dictate what is actually available to you. We keep our Medicare licenses because this choice is confusing and is a real part of a long-term plan.

CMS regulations prohibit further description and specifics on a website. Complete a Scope of Appointment at least 48 hours before our conversation and we can get into the details that matter for your situation.

When you are eligible

Medicare is available to some people before 65, but most become eligible at 65. Social Security is available as early as 62, while Full Retirement Age is 67 for most people. Keep the two programs separate in your mind: they meet only for billing, in that your Medicare premium is usually deducted from your Social Security check.

Find out more

A good place to start is our Medicare webinar. Explaining Medicare on a website can never be comprehensive, and it certainly cannot be specific to your circumstances.

Contact us for Medicare help

Tell us how to reach you and we will get in touch. If you want to go into plan specifics, we will send a Scope of Appointment to sign first — that is what CMS requires before we can discuss them.

We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE, or your State Health Insurance Assistance Program, to get information on all of your options. Goat Planning is not connected with or endorsed by the United States government or the federal Medicare program. This page is general education and is not a recommendation of any specific plan. Jeff Batson is a Registered Financial Consultant® licensed in life, health, annuities and Medicare; he is not an attorney, CPA, or securities-licensed advisor, and nothing here is legal, tax, or investment advice.