As usual, very comprehensive, and informative. Great job. American healthcare is primarily about PROFIT over PEOPLE. Retirees 65+ are especially vulnerable to the profit based healthcare system in America. With information like this, I am just now discovering how expensive supplement premiums are, and will be in the future. But we have no choice but to PAY. Unfortunately, those seniors with smaller incomes may not be able to keep up with prices, and inflation. So where does that leave them? Do they just choose an advantage plan and cross their fingers? "Damned if you do, damned if you don't."
WOW!!! This video is the best that I have watched. I have watched about 100 videos so far, before my 2024 65th birthday. I am trying to be informed and this help immensely. Thanks!
Wow, that was a much bigger answer than I was expecting, and so quick! Although my contribution was tiny, I feel like I somehow collaborated with you (the team behind this company), and that makes me feel very honored indeed. This new video is inclusive and balanced, as always, and it’s a wonderful and perfect answer to my comment. I hereby wish you all raises and bonuses and promotions, but I also must apologize for whatever flak might be coming your way simply because you went out of your way to answer me in such a courageous way. Thank you so much.
Your idea was brilliant! It was fun to try and put together in a semi-cohesive and logical way :) And you TOTALLY collaborated with us! You deserve all the credit! No flak... yet... but it's only been an hour :) Appreciate you!
I lived in Florida for 20 years (we have since moved to Texas) and are not yet Medicare age, but friends who live there say Medicare supplement plans are very expensive because there are so many seniors living there. So MA plans are more common, and because of that many doctors and hospital systems accept them.
Interesting and informative. Since I live in NY and supplemental plans are very expensive, my wife and I have been on an advantage plan for about 10 years now and have found them much more cost effective (neither one of us has even reached the MOOP despite a couple of years that included multiple surgeries). Also neither one of us has had problems with prior authorizations or denial of needed service. For us, advantage plans have worked great.
Thanks 90 Days From Retirement! This is another outstanding video addition to your UA-cam library treasure trove. It would be interesting to see how adverse selection adds to the cost of Medicare Supplement Plans since no underwriting is done during the initial enrollment period ( excluding those states that allow it after initial enrollment ) when people become eligible for Medicare and contrasted with the inability of people who choose Advantage Plans developing serious medical conditions and being unable to opt back in later in life ( Yin and Yang ).😀
Thank you David! Love your thoughts. Adverse selection tends to make those premium increases even worse. We see that from the phasing out of Supplement Plan J and Plan F. Those with issues go to the richest benefit plan during initial enrollment, and their costs don't go down. Those who go with the richest benefit plan (G right now) because of it's benefits eventually grow in cost too, pushing premiums higher, faster than lower benefit plans. Appreciate you David!
Great info! Your videos do a great job of consolidating a lot of complicated information. Sure, you make assumptions, but you have to. An analyst by nature, your presentations are very helpful for me personally. One question (for now)... are your spreadsheets available for those of us that want to add in more relative info (local premiums and costs)? Thank you for providing such useful information!
Hi Larry, thank you so much for watching and I'm glad it's helpful! If you want to email me at erik@90daysfromretirement.com I can send you the spreadsheet I used :)
So..... From what I'm seeing, it could be summed up as being between a rock and a hard place and an even harder place!! LoL... Sorry, but i had to say it. I have been intensely researching Medicare options the last few months as i am getting near the time I will need to choose an appropriate plan for myself. I have watched MANY videos, by several independent agents, and the decision doesn't seem to be getting any easier, unfortunately. One of your videos popped up in my suggested videos today (while watching another Medicare video channel i subscribe to) so i clicked on it. I have to say, I'm impressed with your presentations and have subscribed to your channel. I have watched a few of your videos so far and will watch many more along with any new videos you post. Look forward to speaking to one of your representatives in the not too distant future.
Thank you for spending some time with us and subscribing! Hopefully our videos continue to be helpful in some way, and we'd be honored to help in any way we can when you're ready to reach out :)
Great analysis. I'm on HDG at $46/mo at age 74 in Texas. The only assumption I'd change is the % rate of premium increases for HDG vs G. In actuarial terms, the healthier HDG enrollees as a group, plus the high deductible, should trigger much fewer claims, which is why the premium is so much less. With so little claims exposure, the insurance company should be able to limit the annual bump. In contrast, the Plan G enrollees include the least healthy people with the most claims, so the bump there should be more significant, year over year. And because the base HDG premium is so much less, it compounds more slowly, even with equivalent increases. Also, the HDG deductible increased from $2700 to $2800 in 2024, which represents a 3.7% boost, not bad in an era of high inflation. Over several years of HDG coverage, I have yet to exceed the deductible, so the insurance company has made pure profit from my premiums. Finally, I was startled to see that $6 *per year* Part D plans are available now. That's 50 cents per month!
Yes, you are correct. We made this a while ago, so can't remember if we mentioned that or not, but yes, Plan G likely increases quicker than HD G. Will be making that spreadsheet shareable so people can put in their own numbers :) Thank you for tuning in!
Thank you. You commented on another video for me to look at this one, and you perfectly made my point that an Advantage plan is more cost effective,especially if you are relatively healthy. While I think that it is highly unlikely you are going to hit MOOP every 3rd year, there are certainly going to be OOP expenses in the years in between,mso maybe that balances out. The big takeaway for people should be: they (perhaps intentionally) convoluted all of this and made it as difficult as possible for people to make an informed choice. And second, just going with the maximum coverage of a plan G is not necessarily the best choice, though that is what you hear most often.
Agree 100% We don't feel there's a 1 size fits all recommendation because people have different health needs, financial circumstances, and risk tolerances, not to mention where they live. It is convoluted. Very unfortunate. Appreciate you watching!
Very interesting video even though too many variables to put much stock in. A lot depends on who is in office and how much they want to fund the Advantage plans. HDG is not as likely to have as much premium increases but does have the higher MOOP increases. I think for most reasonably healthy seniors the advantage plan saves the most money as it is hard to reach the MOOP. For supplement plans it depends where you live. In Florida I'm betting on the HDG saving the most because it is hard to hit your MOOP with that also. If I'm hitting the MOOP every year I'm probably not going to be around that many years anyway.
Part B Medicare premiums are HSA qualifying expenses even if they are deducted from your Social Security check. Your spread sheet estimates 83,840.75 of Part B premiums over a 20 year period or 167,681.50 for a couple. Most retirees will not have any trouble spending down their HSA account balance.
I thought it was so awesome to take someone's comment and suggestion to the next level and make a video. Not sure if every person that watches truly appreciates the time and effort that goes into it. As far as 30 years, well I totally agree with the 20 year assessment. The life expectancy of a 65 year old to make it to 95 is extremely low. I do agree you were being generous with the supplement plans. As far as prices you were spot on in my area with the $130 a month and the $55 a month. A video like this can help so many to get a better understanding of the break down in costs over the long haul. I think one step further for them would be to take that amount over 20 years and divide it by 240 months to get an average. I know the increases are a lot more the older we get so it is not a true monthly cost in that sense but it might help in their decision making. You are so right in it coming down to cost in our area, affordability, peace of mind, etc. I've learned so much watching these videos. Two things that have stood out for me is #1 the "G" plan if you can afford it is so easy to get in the beginning. If it gets too expensive for you down the road you can always switch to an Advantage plan. Not as easy the other way around. #2 is if you have good doctors and Hospitals in your area an Advantage plan could easily work regardless of the differences in the plans. I will add that this site has numerous videos in helping anyone with questions about all the different plans concerning Medicare. If you got this far reading my comments I will add if you found this site consider yourself blessed. They are simply the best!
We appreciate you so much!! We actually had it broken down into a monthly average initially! You can read our minds! We took it out because spreadsheets already put a lot of people to sleep and it started getting even more crowded and busy. Thank you for all your kind words and support!
Thank you so much! So glad @justbuz shared that idea. Spreadsheets aren't the most engaging to present... but hopefully it came across okay and wasn't too overwhelming to follow. Appreciate you!
As another person commented, Part B premiums can be reimbursed from an HSA even though they've already been deducted from SS payments. I'm hoping to use the tax-free earnings on my invested HSA funds to reimburse my Part B premiums for my entire lifetime.
Very interesting. Thank you. In our state (MN) the equivalent of plan N appears to have premiums almost a hundred dollars a month less than the equivalent of plan G. We’re definitely looking at the N equivalent. If, as you mentioned have medical issues MA plans could be problematic especially the part B drugs as well as no choice of part D plan. I hear a lot of agents talk about buy cancer plans to cover the part B gap but of course there are lots of part B drugs unrelated to cancer making that an issue. Plus of course putting up with the pre authorization process even if it’s always approved.
This is a good start. Now what I'd like to see is how to choose a company. In my area there are over 45 G plans, and if you add high deductible G and N plans it is over 100. Their cost per month vary by over $300!
That's hopefully where an agent can help you. They will know the strengths and weaknesses of many of the insurance companies around you. Doesn't cost you anything to use an agent. We're biased though 🙂
The bias and "no cost" is the problem. The agent is only going to present companies that they contract with. How and why were they chosen? Are they the best company for me or the agent? I visited one of your agents and he only presented 3 companies and had no answer when asked why those in particular. Maybe you could do a video on how you choose the companies to rep for. @@Theretirementnerds
@@juansigned which of our agents did you meet with? And correct, the agent will only present companies they contract with because that is all an agent is allowed to present. We lose our license if we try to represent companies we are not contracted with. Some insurance companies don't contract with agents. Kaiser as an example. We have some locally that insure municipalities and state workers (fire departments, police, public works etc.) that doesn't work with agents. We have another large church with it's own plan that doesn't contract with agents. So, what do we do if you want (and qualify) for one of those plans? We show you how to get it through Medicare.gov or direct through the specific insurance company. We do it all the time. We don't get paid for it, but it's the right thing to do, so we do it. To answer the question of how we decide who to contract with - we contract with the companies that will contract with agents. Hope that helps! Genuinely curious to know who on our team you met with?
The agent was perfectly nice and I don't want him to get in trouble. This being the internet I'm only going to use his initials, F. E. @@Theretirementnerds
Funny, but my MA HMO plan has gone down in premium each year (for the last 5) while the benefits increased! Cost: $26 per month, MOOP $3850 in 2024, with free pre-loaded $600 debit card.😊
Thank you for sharing! Yeah... we tried to give supplement plans all the advantages we could, but when it comes to costs, it's hard to beat advantage plans. There are other factors in that decision of course, but dollars are important. Appreciate you!
Interesting video, Erik. I know that you used the average for the Part D cost but I think that a large number of people, myself included, only take a couple of Tier 1 or 2 generic drugs so the plans that we choose will be much less than the average cost used in the video. I'll be going with the Wellcare $0.50 per month plan in April when I turn 65. My total annual cost for my meds will be $6.00. I know that can change and that that plan may go up as well in the future but it does take a bite out of the cost projection on your spreadsheet. Also, l'll be on Plan N which will hopefully have smaller percentage increases over time than Plan G on your spreadsheet projection. I hate the HMO Obamacare plan that I'm on right now and that's basically what Advantage plans are. So, I'm looking forward to having the freedom of just seeing the doctors that I want, where and when I want. (If I was forced to get an advantage plan, I'd definitely opt for a PPO plan though.) HMOs, for lack of a better word, suck. Thanks again!
All excellent points Tom. You are right, those below the average will have more favorable numbers for sure. It was an impossible video to try and pull off haha. So many variables and assumptions and projecting 20 years... Who knows if Medicare as we know it will even be around in 20 years. Plan N (for now) does have smaller percentage increases. Historically, they phase out the stronger supplement plans (J, F) and G would be next, pushing everyone into N at some point and it'll run into the same problem. But that is in the future :) Appreciate you!!
Well done as usual! I've heard (somehwere) that Plan G premiums are likely to rise faster than Plan N premiums. The Plan G increase of 7% used in your analysis is a bitter pill. Any thoughts on this 7% in relation to expected Plan N premium growth?
Yes, if things track as they have historically. There used to be a Plan J and Plan F. Those were the most benefit-rich supplement plans available in their time. What happens is those who are in poor health, with higher costs, flock to those plans when they are guaranteed issue, leaving that pool of people more costly than say a Plan G back in the day, or a Plan N or HD G. Healthier individuals would go to the lower benefit, lower cost plans. Well, now Plan G is the most benefit-rich plan, and is where those with high costs flock, making the pool of people more costly and warranting more aggressive rate increases than other pools with lower risk. Does that answer your question? Eventually, Plan G will probably phase out like Plan J and Plan F before it, and Plan N will become the most benefit-rich plan and encounter similar issues... Great question!
Thank you for your time and talent that you share. My confusion is on IRMAA premiums which wasn't completely addressed on this video. I have heard conflicting answers/opinions on the coming 2024 rates for us. Which year back is IRMAA based? One year back or two years back? We sold stock in 2022 and I'm worried our joint filing is going to impact our 2024 parts B and D premiums tremendously. Plus my husband just had a kidney pulled out due to cancer so I'm concerned he won't pass medical questions on supplemental plans? Is there preexisting conditions on initial enrollment for him coming Jan 1 when he wishes to retire?
Thank you so much for watching! IRMAA is based on your tax return - two years prior. If your husband is going onto Medicare for the first time in January, he does not need to go through underwriting. There is a supplement open enrollment window where he would be able to get the supplement without underwriting. This is assuming he is turning 65 in January or he is coming off of a company insurance plan through work in January. Hope that helps! Happy to dive deeper if you want to send me an email to erik@90daysfromretirement.com
My wife is on High Deductible G. Hitting the max deductible is very hard unless you have inpatient care. We are also physicians. HDG is Not for those that are chronically ill. However, the chance of maxing your deductible every 3 years is extremely unlikely, we actually conservatively use an every 5 year number. Both our elderly mothers had 2 bad years out of 20 on Advantage. In our area the monthly cost difference between G and HDG is $140(a savings of $1680).You will likely max out your deductible almost every year on G since it is low. We figure to save $1000 per year with HDG 4 out of 5 years and lose $1400 every 5th year. Also,the premium increase are less. The other fact is that the more you use your insurance for large events, the less likely you are to get very old. For every person who makes it to 85, more than one other person didn’t! The last point, is that you can always change from a supplemental to Advantage should you develop more chronic illness.
Really good analysis. Thanks. Inflation in the Part B premium is manageable, because there is also a Social Security annual COLA. And a maximum out of pocket inflation is also manageable for the person of average health (plus, as you point out, historically there has NOT been OOP inflation in Part C (Advantage). But Part G, Part G HD, and Part N premium inflation is much higher than the Part C premium inflation, because any percent of zero will always be less than any percent of not-zero. And there is a compounding effect: Because premium inflation increases compound, the actual dollar amount of G, G-HD and N increases accelerate over time. You can always slide back to Advantage, but you'll be doing that when you are most likely to be hitting OOP maximum (i.e. as you get older). And you can never get those G, G-HD, or N premiums back, even if they were wasted by your not needing the care in your earlier retirement years.
Thank you for this. Since I live in NY and plan to retire in NY (I'm 62, planning on working until at least 67), I'm kind of blown away. If by some miracle I make it to 85, Medicare A/B, supplement plan, part D, (just the premiums) will take about 1/2, probably more, of my retirement funds between SS, a small pension (around $225 a month) and a small 401K. The one thing I think is obvious to me at this point, if my company allows it, I'll stay on my company plan (HD) past 65 and build up my HSA (I don't have a huge balance, 2X my max out of pocket) as much as I can so I can take the Medigap HD plan. Maybe I should plan on working until 70.
@reb569 being in NY has some advantages in that you can get a supplement plan guaranteed issue - year round. Not saying this is what you should do, but many take advantage plans to save on premiums and, if their Healthcare costs go up because of poor health, they switch to supplement plans. More flexibility there in NY than almost anywhere else. Just very expensive supplement plans.
@@Theretirementnerds -- thank you -- good to know. I definitely have time to research and make the decisions. I knew it wasn't going to be cheap, but was kind of blown away by the NY pricing (was looking at the NY medicare site last night). I have knee replacement coming up in the future, so I have to keep that in mind too.
Dang, that was a good, generalized snapshot comparison. I imagine it would be nearly impossible to do for everyone's location. I was curious why you didn't include Plan N? I was kind of shocked the G-HD hit so high! Wow! I guess you couldn't include all the Advantage Plan members who didn't make it b/c of the delay/denial of treatments. hehe. While the MediGaps do look expensive over the 10 yrs, I have to keep in mind that over time the Advantage plans are going to ensure they can maintain a profit margin b/c they are always for-profits. So there will likely be "creep" in premiums or MOOP or something. It is stark and shocking, but, we all need it more and more as we age.
Thank you for watching! Not just different locations, but even an individual in one location would be impossible to predict how much they will use the healthcare system over 20 years. It's a daunting task, but we did our best :) Didn't include N mostly because of time and it's pretty similar to G where HD is quite a bit different in terms of premiums to cost-sharing. Appreciate you watching and sharing your thoughts!
It isn't all that difficult to recreate the spreadsheets on your own and plug in actual premiums from the medicare quote engine for select medigap plans in your area. That will give you an idea of what costs are likely to be like for you where you live.
@@JeanPierreWhite Thank you, yes, I could get there, I just turned 60 so I have a few years yet, but I have been Medicare curious for the past 1-2 yrs, and at first, it was so confusing, I was glad I did start trying to understand it early! I knew Medigap plans are the more expensive route, I was a bit surprised that the G-HD isn't necessarily cheaper, and, that Advantage Plans are THAT much cheaper, assuming, the folks lived through their conditions without being delayed/denied! I still think the prudent course will be to go through a broker who can advise on which carriers/plans have the more "stable" price increases over time.
@@ph5915 Yes the High deductible supplement plans aren't all that great IMHO. Another YT creator calculated that it takes 3.3 years to catch-up from a bad year with a high deductible plan. The numbers presented here would appear to support that calculation. On commercial insurance I liked high deductible plans, specifically because of the HSA account.and its tax savings. If medigap plans allowed you to contribute to an HSA then it may make sense, but right now it doesn't.
Hi tried to leave comment earlier but YTube likely blocked because I put a link in it. Just wanted to say thanks for making great content here. Also your spreadsheets do not include the part b premiums in the HSA eligible expenses. To my knowledge the irs allows all Medicare part b,c and d premiums to be reimbursed from an HSA if 65 or older. Pub. 969 IRS. Even though part b is deducted from SSA payment you can still get reimbursed for the premium from HSA.Medigap premiums are as you mentioned not allowed. Anyway thanks for all the hard work on making this content much appreciated!
You are 100% correct. You can use an HSA for Part B premiums. Everyone has their own thought process on that. We'd rather keep the HSA dollars in the account to grow rather than using it to pay part B when that is taken from SS. But you can absolutely reimburse yourself for Part B through the HSA. Thank you!
Hi Thanks for your thoughts. As for me, since my SSA is taxed anyway @85%, I rather take my money out of my HSA to pay for my healthcare premiums as much as I can ,and do an equal Roth Conversion from my IRA. In essence, net net portfolio wise a wash ,I am moving money from my HSA to my Roth (using my IRA). That way I keep my $'s goring tax free in my Roth as well, however without the HSA distribution restrictions...Best of both worlds! Maybe a great Video for the future? Tax strategy probs too much in the weeds....@@Theretirementnerds
@@andyd102 sounds like you have quite the strategy. A quick clarification, and you probably already know this but the way it was typed was a little inaccurate, so just want to make sure. Your SS is not taxed at 85%. Up to 85% of your SS income is taxable at your marginal tax bracket rates. If you have $10,000 in SS benefit taxable at 85%, that means $1,500 is not touched by taxes at all. The remaining $8,500 taxed at whatever your marginal rate is (let's say 10%), that means $850 goes to taxes. Of your $10,000 in benefits, you keep $9,150, an effective tax rate of 8.5% on your SS benefits. We have a video on that here: ua-cam.com/video/-NlSlZeoRn4/v-deo.html Again, based on your response, you likely already know this, but just wanted to clarify based on how it was typed :)
If you are working for a company, you can stay on that plan for as long as you want - assuming the company has at least 20 employees. Some employers have retiree plans that are different than this. Federal employees have other options as well. Once you start taking SS, you must have at least Medicare Part A. Once you turn 65, you lose the marketplace subsidies and a marketplace plan becomes much more costly than Medicare. So, to answer your question - private insurance is what these Advantage and Supplement plans are. A marketplace plan will be worse than Medicare once you hit 65.
@@Theretirementnerds I prefer to be a self-pay patient when I need medical care. I hate being told what doctors I can and can't see. The whole thing is annoying. I really wish I opted out of social security and never paid a cent into it. I'd be better off financially if I invested all the money throughout my life that I paid I into SS (self-employed for decades, so I've had to pay the entire SS tax myself). My current doctor doesn't take insurance, and he is the best I've had in my adult life. He is in private practice with partners, and none of them take insurance. I do have insurance in case anything big happens medically, but my regular care is completely outside the circus of insurance.
Excellent analysis, but I feel like I’m going to throw up. I don’t know how any of these can be affordable. I’ll have to hope I don’t last nearly that long. In the meantime, I need to get serious about moving to Spain. The US is the absolute pits.
In most states, correct. From the perspective of the insurance company, they have a certain level of risk with each plan. HD G, they bring in dollars in premiums, call it $800 per year, and the risk of needing to pay that out is relatively low given the High Deductible that needs to be met by the individual first, not the insurance company. In general, healthier people gravitate to HD G because they don't think they'll need the healthcare system much amd want the lower premium. With Regular G, the insurance company has the opposite. They collect call it $1500 a year in premiums, but have to start paying out after only a $240 deductible. Plus, those who have high cost, chronic conditions flock to Plan G, so the risk of payments and loss is much higher with regular G. So, it becomes too big a risk to allow people to not pay in the premiums they "should" for the coverage of full G during the healthy years that will help buffer the bad years.
@jdenino6022 not if you sign up during your supplement plan open enrollment window. If you're trying to go from HD G to a regular G later (in most states) you have to answer medical questions and can be denied or charged more. This video goes into switching in more detail. Mostly around Advantage to Supplement, but a lot of the same issues apply for one supplement to another. ua-cam.com/video/djuGeI829M4/v-deo.html
@@Theretirementnerds Boy the gov't goofed up on protecting senior citizens when they crafted the Affordable care act they left senior citizen protections out.
Retire at 65 most men will die at about 85 or less. Women will live another 3 years on average to age 88 if they're lucky not to get cancer or if a stroke doesn't take you out.
Looks like medical costs rising higher than inflation in most years is going to eat away at the nest egg much faster than everything else. Try to stay healthy!!!!
This is an eye-opener, and a tie-breaker for me in choosing my retirement health care plan. THANK YOU!
So glad it was helpful!
One of the best, straightforward, comprehensive comparison. I had my doubts about this site but I digress. Well done!
Thank you so much!
As usual, very comprehensive, and informative. Great job. American healthcare is primarily about PROFIT over PEOPLE. Retirees 65+ are especially vulnerable to the profit based healthcare system in America. With information like this, I am just now discovering how expensive supplement premiums are, and will be in the future. But we have no choice but to PAY. Unfortunately, those seniors with smaller incomes may not be able to keep up with prices, and inflation. So where does that leave them? Do they just choose an advantage plan and cross their fingers? "Damned if you do, damned if you don't."
WOW!! I no idea that the premium amount would be that much higher at 85 than 65. You have opened my eyes to so many decisions! Thank you!
Thank you for watching!!
WOW!!! This video is the best that I have watched. I have watched about 100 videos so far, before my 2024 65th birthday. I am trying to be informed and this help immensely. Thanks!
This means a lot! Thank you so much for taking the time to watch and leave this comment!
Wow, that was a much bigger answer than I was expecting, and so quick! Although my contribution was tiny, I feel like I somehow collaborated with you (the team behind this company), and that makes me feel very honored indeed. This new video is inclusive and balanced, as always, and it’s a wonderful and perfect answer to my comment. I hereby wish you all raises and bonuses and promotions, but I also must apologize for whatever flak might be coming your way simply because you went out of your way to answer me in such a courageous way. Thank you so much.
Your idea was brilliant! It was fun to try and put together in a semi-cohesive and logical way :)
And you TOTALLY collaborated with us! You deserve all the credit!
No flak... yet... but it's only been an hour :)
Appreciate you!
I lived in Florida for 20 years (we have since moved to Texas) and are not yet Medicare age, but friends who live there say Medicare supplement plans are very expensive because there are so many seniors living there. So MA plans are more common, and because of that many doctors and hospital systems accept them.
@ssa8479 Florida, New York, and a couple other states have quite high supplements 😬
Interesting and informative. Since I live in NY and supplemental plans are very expensive, my wife and I have been on an advantage plan for about 10 years now and have found them much more cost effective (neither one of us has even reached the MOOP despite a couple of years that included multiple surgeries). Also neither one of us has had problems with prior authorizations or denial of needed service. For us, advantage plans have worked great.
Thank you for sharing your experience! NY has some of the highest premiums in the country for Supplement plans 😬
Thanks 90 Days From Retirement! This is another outstanding video addition to your UA-cam library treasure trove. It would be interesting to see how adverse selection adds to the cost of Medicare Supplement Plans since no underwriting is done during the initial enrollment period ( excluding those states that allow it after initial enrollment ) when people become eligible for Medicare and contrasted with the inability of people who choose Advantage Plans developing serious medical conditions and being unable to opt back in later in life ( Yin and Yang ).😀
Thank you David!
Love your thoughts. Adverse selection tends to make those premium increases even worse. We see that from the phasing out of Supplement Plan J and Plan F. Those with issues go to the richest benefit plan during initial enrollment, and their costs don't go down. Those who go with the richest benefit plan (G right now) because of it's benefits eventually grow in cost too, pushing premiums higher, faster than lower benefit plans.
Appreciate you David!
@@Theretirementnerds Thank you for that reply.🙏
Just so instructional! So helpful. Thank you so much! 🤗
Glad you enjoyed it! Thank you for watching!
Nice analysis and video - thanks!
Thank you so much!
Great analysis! It makes you wonder how most people will be able to afford Medicare given what you hear about how little savings most people have.
Thank you!
Looking forward to a Plan G vs Plan N twenty-year projection in the new future.
Great presentation!
Thank you! We'll get on it!
Me too
Great info! Your videos do a great job of consolidating a lot of complicated information. Sure, you make assumptions, but you have to. An analyst by nature, your presentations are very helpful for me personally. One question (for now)... are your spreadsheets available for those of us that want to add in more relative info (local premiums and costs)?
Thank you for providing such useful information!
Hi Larry, thank you so much for watching and I'm glad it's helpful! If you want to email me at erik@90daysfromretirement.com I can send you the spreadsheet I used :)
So..... From what I'm seeing, it could be summed up as being between a rock and a hard place and an even harder place!! LoL... Sorry, but i had to say it. I have been intensely researching Medicare options the last few months as i am getting near the time I will need to choose an appropriate plan for myself. I have watched MANY videos, by several independent agents, and the decision doesn't seem to be getting any easier, unfortunately. One of your videos popped up in my suggested videos today (while watching another Medicare video channel i subscribe to) so i clicked on it. I have to say, I'm impressed with your presentations and have subscribed to your channel. I have watched a few of your videos so far and will watch many more along with any new videos you post. Look forward to speaking to one of your representatives in the not too distant future.
Thank you for spending some time with us and subscribing! Hopefully our videos continue to be helpful in some way, and we'd be honored to help in any way we can when you're ready to reach out :)
As always great information on Medicare Thank you 🇵🇷🇺🇸
Thank you Eddie!
@@Theretirementnerds your welcome
How are senior citizens supposed to afford this? 🤨
Excellent video! I love the way you extrapolate the cost of each over the 20 year period. Great question, Justbuz😀
Thank you so much for watching!
Great analysis. I'm on HDG at $46/mo at age 74 in Texas. The only assumption I'd change is the % rate of premium increases for HDG vs G. In actuarial terms, the healthier HDG enrollees as a group, plus the high deductible, should trigger much fewer claims, which is why the premium is so much less. With so little claims exposure, the insurance company should be able to limit the annual bump. In contrast, the Plan G enrollees include the least healthy people with the most claims, so the bump there should be more significant, year over year. And because the base HDG premium is so much less, it compounds more slowly, even with equivalent increases. Also, the HDG deductible increased from $2700 to $2800 in 2024, which represents a 3.7% boost, not bad in an era of high inflation. Over several years of HDG coverage, I have yet to exceed the deductible, so the insurance company has made pure profit from my premiums. Finally, I was startled to see that $6 *per year* Part D plans are available now. That's 50 cents per month!
Yes, you are correct. We made this a while ago, so can't remember if we mentioned that or not, but yes, Plan G likely increases quicker than HD G.
Will be making that spreadsheet shareable so people can put in their own numbers :)
Thank you for tuning in!
Thank you. You commented on another video for me to look at this one, and you perfectly made my point that an Advantage plan is more cost effective,especially if you are relatively healthy. While I think that it is highly unlikely you are going to hit MOOP every 3rd year, there are certainly going to be OOP expenses in the years in between,mso maybe that balances out.
The big takeaway for people should be: they (perhaps intentionally) convoluted all of this and made it as difficult as possible for people to make an informed choice. And second, just going with the maximum coverage of a plan G is not necessarily the best choice, though that is what you hear most often.
Agree 100%
We don't feel there's a 1 size fits all recommendation because people have different health needs, financial circumstances, and risk tolerances, not to mention where they live. It is convoluted. Very unfortunate. Appreciate you watching!
Very interesting video even though too many variables to put much stock in. A lot depends on who is in office and how much they want to fund the Advantage plans. HDG is not as likely to have as much premium increases but does have the higher MOOP increases. I think for most reasonably healthy seniors the advantage plan saves the most money as it is hard to reach the MOOP. For supplement plans it depends where you live. In Florida I'm betting on the HDG saving the most because it is hard to hit your MOOP with that also. If I'm hitting the MOOP every year I'm probably not going to be around that many years anyway.
Part B Medicare premiums are HSA qualifying expenses even if they are deducted from your Social Security check. Your spread sheet estimates 83,840.75 of Part B premiums over a 20 year period or 167,681.50 for a couple. Most retirees will not have any trouble spending down their HSA account balance.
Correct! Part B premiums can be paid with HSAs, usually as a reimbursement. Thank you for adding that!
Love the fire hose style of information conveyance.
I thought it was so awesome to take someone's comment and suggestion to the next level and make a video. Not sure if every person that watches truly appreciates the time and effort that goes into it. As far as 30 years, well I totally agree with the 20 year assessment. The life expectancy of a 65 year old to make it to 95 is extremely low. I do agree you were being generous with the supplement plans. As far as prices you were spot on in my area with the $130 a month and the $55 a month. A video like this can help so many to get a better understanding of the break down in costs over the long haul. I think one step further for them would be to take that amount over 20 years and divide it by 240 months to get an average. I know the increases are a lot more the older we get so it is not a true monthly cost in that sense but it might help in their decision making. You are so right in it coming down to cost in our area, affordability, peace of mind, etc. I've learned so much watching these videos. Two things that have stood out for me is #1 the "G" plan if you can afford it is so easy to get in the beginning. If it gets too expensive for you down the road you can always switch to an Advantage plan. Not as easy the other way around. #2 is if you have good doctors and Hospitals in your area an Advantage plan could easily work regardless of the differences in the plans. I will add that this site has numerous videos in helping anyone with questions about all the different plans concerning Medicare. If you got this far reading my comments I will add if you found this site consider yourself blessed. They are simply the best!
We appreciate you so much!!
We actually had it broken down into a monthly average initially! You can read our minds!
We took it out because spreadsheets already put a lot of people to sleep and it started getting even more crowded and busy.
Thank you for all your kind words and support!
Another balanced presentation. Kudos to @justbuz for coming up with this idea and Erik for running with it. Gotta love a spreadsheet!
Thank you so much! So glad @justbuz shared that idea. Spreadsheets aren't the most engaging to present... but hopefully it came across okay and wasn't too overwhelming to follow. Appreciate you!
As another person commented, Part B premiums can be reimbursed from an HSA even though they've already been deducted from SS payments. I'm hoping to use the tax-free earnings on my invested HSA funds to reimburse my Part B premiums for my entire lifetime.
Sounds like a solid plan! Thank you for watching!
Very interesting. Thank you. In our state (MN) the equivalent of plan N appears to have premiums almost a hundred dollars a month less than the equivalent of plan G. We’re definitely looking at the N equivalent. If, as you mentioned have medical issues MA plans could be problematic especially the part B drugs as well as no choice of part D plan. I hear a lot of agents talk about buy cancer plans to cover the part B gap but of course there are lots of part B drugs unrelated to cancer making that an issue. Plus of course putting up with the pre authorization process even if it’s always approved.
Thank you for watching and sharing your thoughts!
This is a good start. Now what I'd like to see is how to choose a company. In my area there are over 45 G plans, and if you add high deductible G and N plans it is over 100. Their cost per month vary by over $300!
That's hopefully where an agent can help you. They will know the strengths and weaknesses of many of the insurance companies around you. Doesn't cost you anything to use an agent. We're biased though 🙂
The bias and "no cost" is the problem. The agent is only going to present companies that they contract with. How and why were they chosen? Are they the best company for me or the agent? I visited one of your agents and he only presented 3 companies and had no answer when asked why those in particular. Maybe you could do a video on how you choose the companies to rep for. @@Theretirementnerds
@@juansigned which of our agents did you meet with? And correct, the agent will only present companies they contract with because that is all an agent is allowed to present. We lose our license if we try to represent companies we are not contracted with.
Some insurance companies don't contract with agents. Kaiser as an example. We have some locally that insure municipalities and state workers (fire departments, police, public works etc.) that doesn't work with agents. We have another large church with it's own plan that doesn't contract with agents.
So, what do we do if you want (and qualify) for one of those plans? We show you how to get it through Medicare.gov or direct through the specific insurance company.
We do it all the time. We don't get paid for it, but it's the right thing to do, so we do it.
To answer the question of how we decide who to contract with - we contract with the companies that will contract with agents.
Hope that helps! Genuinely curious to know who on our team you met with?
The agent was perfectly nice and I don't want him to get in trouble. This being the internet I'm only going to use his initials, F. E. @@Theretirementnerds
Funny, but my MA HMO plan has gone down in premium each year (for the last 5) while the benefits increased! Cost: $26 per month, MOOP $3850 in 2024, with free pre-loaded $600 debit card.😊
Thank you for sharing! Yeah... we tried to give supplement plans all the advantages we could, but when it comes to costs, it's hard to beat advantage plans. There are other factors in that decision of course, but dollars are important. Appreciate you!
Interesting video, Erik. I know that you used the average for the Part D cost but I think that a large number of people, myself included, only take a couple of Tier 1 or 2 generic drugs so the plans that we choose will be much less than the average cost used in the video. I'll be going with the Wellcare $0.50 per month plan in April when I turn 65. My total annual cost for my meds will be $6.00. I know that can change and that that plan may go up as well in the future but it does take a bite out of the cost projection on your spreadsheet. Also, l'll be on Plan N which will hopefully have smaller percentage increases over time than Plan G on your spreadsheet projection.
I hate the HMO Obamacare plan that I'm on right now and that's basically what Advantage plans are. So, I'm looking forward to having the freedom of just seeing the doctors that I want, where and when I want. (If I was forced to get an advantage plan, I'd definitely opt for a PPO plan though.) HMOs, for lack of a better word, suck. Thanks again!
All excellent points Tom. You are right, those below the average will have more favorable numbers for sure. It was an impossible video to try and pull off haha. So many variables and assumptions and projecting 20 years... Who knows if Medicare as we know it will even be around in 20 years.
Plan N (for now) does have smaller percentage increases. Historically, they phase out the stronger supplement plans (J, F) and G would be next, pushing everyone into N at some point and it'll run into the same problem. But that is in the future :)
Appreciate you!!
Well done as usual! I've heard (somehwere) that Plan G premiums are likely to rise faster than Plan N premiums. The Plan G increase of 7% used in your analysis is a bitter pill. Any thoughts on this 7% in relation to expected Plan N premium growth?
Yes, if things track as they have historically.
There used to be a Plan J and Plan F. Those were the most benefit-rich supplement plans available in their time. What happens is those who are in poor health, with higher costs, flock to those plans when they are guaranteed issue, leaving that pool of people more costly than say a Plan G back in the day, or a Plan N or HD G. Healthier individuals would go to the lower benefit, lower cost plans.
Well, now Plan G is the most benefit-rich plan, and is where those with high costs flock, making the pool of people more costly and warranting more aggressive rate increases than other pools with lower risk.
Does that answer your question?
Eventually, Plan G will probably phase out like Plan J and Plan F before it, and Plan N will become the most benefit-rich plan and encounter similar issues...
Great question!
Yes, that answers my question. I appreciate your response!@@Theretirementnerds
Thank you for your time and talent that you share. My confusion is on IRMAA premiums which wasn't completely addressed on this video. I have heard conflicting answers/opinions on the coming 2024 rates for us. Which year back is IRMAA based? One year back or two years back? We sold stock in 2022 and I'm worried our joint filing is going to impact our 2024 parts B and D premiums tremendously. Plus my husband just had a kidney pulled out due to cancer so I'm concerned he won't pass medical questions on supplemental plans? Is there preexisting conditions on initial enrollment for him coming Jan 1 when he wishes to retire?
Thank you so much for watching!
IRMAA is based on your tax return - two years prior.
If your husband is going onto Medicare for the first time in January, he does not need to go through underwriting. There is a supplement open enrollment window where he would be able to get the supplement without underwriting. This is assuming he is turning 65 in January or he is coming off of a company insurance plan through work in January.
Hope that helps!
Happy to dive deeper if you want to send me an email to erik@90daysfromretirement.com
My wife is on High Deductible G. Hitting the max deductible is very hard unless you have inpatient care. We are also physicians. HDG is Not for those that are chronically ill. However, the chance of maxing your deductible every 3 years is extremely unlikely, we actually conservatively use an every 5 year number. Both our elderly mothers had 2 bad years out of 20 on Advantage.
In our area the monthly cost difference between G and HDG is $140(a savings of $1680).You will likely max out your deductible almost every year on G since it is low. We figure to save $1000 per year with HDG 4 out of 5 years and lose $1400 every 5th year. Also,the premium increase are less.
The other fact is that the more you use your insurance for large events, the less likely you are to get very old. For every person who makes it to 85, more than one other person didn’t!
The last point, is that you can always change from a supplemental to Advantage should you develop more chronic illness.
All excellent points! @@randolphh8005
Really good analysis. Thanks. Inflation in the Part B premium is manageable, because there is also a Social Security annual COLA. And a maximum out of pocket inflation is also manageable for the person of average health (plus, as you point out, historically there has NOT been OOP inflation in Part C (Advantage). But Part G, Part G HD, and Part N premium inflation is much higher than the Part C premium inflation, because any percent of zero will always be less than any percent of not-zero. And there is a compounding effect: Because premium inflation increases compound, the actual dollar amount of G, G-HD and N increases accelerate over time. You can always slide back to Advantage, but you'll be doing that when you are most likely to be hitting OOP maximum (i.e. as you get older). And you can never get those G, G-HD, or N premiums back, even if they were wasted by your not needing the care in your earlier retirement years.
Thank you so much! Appreciate you adding your insights!
Thank you for this. Since I live in NY and plan to retire in NY (I'm 62, planning on working until at least 67), I'm kind of blown away. If by some miracle I make it to 85, Medicare A/B, supplement plan, part D, (just the premiums) will take about 1/2, probably more, of my retirement funds between SS, a small pension (around $225 a month) and a small 401K. The one thing I think is obvious to me at this point, if my company allows it, I'll stay on my company plan (HD) past 65 and build up my HSA (I don't have a huge balance, 2X my max out of pocket) as much as I can so I can take the Medigap HD plan. Maybe I should plan on working until 70.
@reb569 being in NY has some advantages in that you can get a supplement plan guaranteed issue - year round. Not saying this is what you should do, but many take advantage plans to save on premiums and, if their Healthcare costs go up because of poor health, they switch to supplement plans. More flexibility there in NY than almost anywhere else. Just very expensive supplement plans.
@@Theretirementnerds -- thank you -- good to know. I definitely have time to research and make the decisions. I knew it wasn't going to be cheap, but was kind of blown away by the NY pricing (was looking at the NY medicare site last night). I have knee replacement coming up in the future, so I have to keep that in mind too.
Great video! Any chance you can share that spreadsheet?
Thank you! Happy to. Want to send me an email to erik@90daysfromretirement.com and I'll email it to you
Plan rates vary a lot. The AARP/United Healthcare Plan G in my zip code is $98 a month. Plan N is $72.
Thank you for sharing!
Can I move into your basement? Or at least into your Zip Code? I live in Nevada, and monthly premiums are almost twice that.
Where I'm at, those UHC plans are G $130/month and N $117/month. Not much of a difference to get the better coverage here.
Where it is?
@@kaixingrace88 PIN/Zip code 78665 (Round Rock, Texas).
Dang, that was a good, generalized snapshot comparison. I imagine it would be nearly impossible to do for everyone's location. I was curious why you didn't include Plan N? I was kind of shocked the G-HD hit so high! Wow! I guess you couldn't include all the Advantage Plan members who didn't make it b/c of the delay/denial of treatments. hehe. While the MediGaps do look expensive over the 10 yrs, I have to keep in mind that over time the Advantage plans are going to ensure they can maintain a profit margin b/c they are always for-profits. So there will likely be "creep" in premiums or MOOP or something. It is stark and shocking, but, we all need it more and more as we age.
Thank you for watching! Not just different locations, but even an individual in one location would be impossible to predict how much they will use the healthcare system over 20 years. It's a daunting task, but we did our best :)
Didn't include N mostly because of time and it's pretty similar to G where HD is quite a bit different in terms of premiums to cost-sharing.
Appreciate you watching and sharing your thoughts!
It isn't all that difficult to recreate the spreadsheets on your own and plug in actual premiums from the medicare quote engine for select medigap plans in your area. That will give you an idea of what costs are likely to be like for you where you live.
@@JeanPierreWhite Thank you, yes, I could get there, I just turned 60 so I have a few years yet, but I have been Medicare curious for the past 1-2 yrs, and at first, it was so confusing, I was glad I did start trying to understand it early! I knew Medigap plans are the more expensive route, I was a bit surprised that the G-HD isn't necessarily cheaper, and, that Advantage Plans are THAT much cheaper, assuming, the folks lived through their conditions without being delayed/denied! I still think the prudent course will be to go through a broker who can advise on which carriers/plans have the more "stable" price increases over time.
@@ph5915 Yes the High deductible supplement plans aren't all that great IMHO. Another YT creator calculated that it takes 3.3 years to catch-up from a bad year with a high deductible plan. The numbers presented here would appear to support that calculation.
On commercial insurance I liked high deductible plans, specifically because of the HSA account.and its tax savings. If medigap plans allowed you to contribute to an HSA then it may make sense, but right now it doesn't.
Hi tried to leave comment earlier but YTube likely blocked because I put a link in it. Just wanted to say thanks for making great content here. Also your spreadsheets do not include the part b premiums in the HSA eligible expenses. To my knowledge the irs allows all Medicare part b,c and d premiums to be reimbursed from an HSA if 65 or older. Pub. 969 IRS. Even though part b is deducted from SSA payment you can still get reimbursed for the premium from HSA.Medigap premiums are as you mentioned not allowed. Anyway thanks for all the hard work on making this content much appreciated!
You are 100% correct. You can use an HSA for Part B premiums. Everyone has their own thought process on that. We'd rather keep the HSA dollars in the account to grow rather than using it to pay part B when that is taken from SS. But you can absolutely reimburse yourself for Part B through the HSA. Thank you!
Hi Thanks for your thoughts. As for me, since my SSA is taxed anyway @85%, I rather take my money out of my HSA to pay for my healthcare premiums as much as I can ,and do an equal Roth Conversion from my IRA. In essence, net net portfolio wise a wash ,I am moving money from my HSA to my Roth (using my IRA). That way I keep my $'s goring tax free in my Roth as well, however without the HSA distribution restrictions...Best of both worlds! Maybe a great Video for the future? Tax strategy probs too much in the weeds....@@Theretirementnerds
@@andyd102 sounds like you have quite the strategy. A quick clarification, and you probably already know this but the way it was typed was a little inaccurate, so just want to make sure.
Your SS is not taxed at 85%. Up to 85% of your SS income is taxable at your marginal tax bracket rates.
If you have $10,000 in SS benefit taxable at 85%, that means $1,500 is not touched by taxes at all. The remaining $8,500 taxed at whatever your marginal rate is (let's say 10%), that means $850 goes to taxes. Of your $10,000 in benefits, you keep $9,150, an effective tax rate of 8.5% on your SS benefits.
We have a video on that here:
ua-cam.com/video/-NlSlZeoRn4/v-deo.html
Again, based on your response, you likely already know this, but just wanted to clarify based on how it was typed :)
Yes 85% of my SS benefits is included in my taxable income! Quite blessed having that problem!
This is all so convoluted. Can't I just keep private insurance or a marketplace plan for the rest of my life?
If you are working for a company, you can stay on that plan for as long as you want - assuming the company has at least 20 employees.
Some employers have retiree plans that are different than this.
Federal employees have other options as well.
Once you start taking SS, you must have at least Medicare Part A.
Once you turn 65, you lose the marketplace subsidies and a marketplace plan becomes much more costly than Medicare.
So, to answer your question - private insurance is what these Advantage and Supplement plans are. A marketplace plan will be worse than Medicare once you hit 65.
@@Theretirementnerds I prefer to be a self-pay patient when I need medical care. I hate being told what doctors I can and can't see. The whole thing is annoying. I really wish I opted out of social security and never paid a cent into it. I'd be better off financially if I invested all the money throughout my life that I paid I into SS (self-employed for decades, so I've had to pay the entire SS tax myself). My current doctor doesn't take insurance, and he is the best I've had in my adult life. He is in private practice with partners, and none of them take insurance. I do have insurance in case anything big happens medically, but my regular care is completely outside the circus of insurance.
Excellent analysis, but I feel like I’m going to throw up. I don’t know how any of these can be affordable. I’ll have to hope I don’t last nearly that long. In the meantime, I need to get serious about moving to Spain. The US is the absolute pits.
so you can't switch from a High Deductible G plan to a regular G plan easily, why is that?
In most states, correct.
From the perspective of the insurance company, they have a certain level of risk with each plan. HD G, they bring in dollars in premiums, call it $800 per year, and the risk of needing to pay that out is relatively low given the High Deductible that needs to be met by the individual first, not the insurance company. In general, healthier people gravitate to HD G because they don't think they'll need the healthcare system much amd want the lower premium.
With Regular G, the insurance company has the opposite. They collect call it $1500 a year in premiums, but have to start paying out after only a $240 deductible. Plus, those who have high cost, chronic conditions flock to Plan G, so the risk of payments and loss is much higher with regular G.
So, it becomes too big a risk to allow people to not pay in the premiums they "should" for the coverage of full G during the healthy years that will help buffer the bad years.
@@Theretirementnerds Thanks for answer.
Is there a waiting period for any preexisting conditions on the G plan?!?
@jdenino6022 not if you sign up during your supplement plan open enrollment window. If you're trying to go from HD G to a regular G later (in most states) you have to answer medical questions and can be denied or charged more.
This video goes into switching in more detail. Mostly around Advantage to Supplement, but a lot of the same issues apply for one supplement to another.
ua-cam.com/video/djuGeI829M4/v-deo.html
@@Theretirementnerds Boy the gov't goofed up on protecting senior citizens when they crafted the Affordable care act they left senior citizen protections out.
This just just demonstrates why we need a single payer national health plan like the rest of the world has.
Retire at 65 most men will die at about 85 or less. Women will live another 3 years on average to age 88 if they're lucky not to get cancer or if a stroke doesn't take you out.
Looks like medical costs rising higher than inflation in most years is going to eat away at the nest egg much faster than everything else. Try to stay healthy!!!!
Yes! We hope everyone stays healthy!
Elderly Illegal Aliens can get it all for "free".
Bottom line, you can't afford to live too long🫤