Enrollment and Tax Tips for 2019 Marketplace Coverage

Open Enrollment ends 11:59pm on Saturday, December 15th.

Insurance Brokers have a somewhat unique perspective on the process of enrollment and the tax implications of holding Marketplace coverage by virtue of having dealt personally with hundreds of others experiences. If you’re looking to or have already enrolled in coverage for this year, check out the tips below, it may save you money or perhaps more importantly, a tax time headache.

1. There are effectively two insurers left in Pasco/Hernando counties on the Marketplace for 2019, BlueCross BlueShield (Florida Blue) and Ambetter (three in Pinellas if you count Molina). For those who are currently enrolled in Marketplace coverage for 2018, if you do nothing, you are generally just re-enrolled in the same plan. Keep in mind that many plans have been reformulated and new plans are available in 2019 that were not in 2018, so it is still best to check every year to see if you are not better served by a different plan (for example, I've seen that most people enrolled in the Ambetter Balanced Care 5 plan with a CSR are generally better served by the Ambetter Balanced Care 11 in 2019)

2. I am tending to see those who are self-employed overestimate their Adjusted Gross Income (AGI) when quoting Marketplace plans, as AGI determines premiums. Remember that self-employed persons need to deduct business expenses when calculating AGI. For example, a 32 year old single male Uber/Lyft driver calculating his income as $34,000/yr would pay $270/mo with a $6k deductible for a silver plan in the Marketplace. If he accurately deducts his expenses as an independent contractor (standard mileage, gas, car payment, car insurance, mobile phone payment, wireless plan) so that his AGI reflects a $20,000 income, he would be eligible for a $74/mo plan with a $0 deductible or a $0/mo bronze plan (catastrophic coverage, better than being uninsured).

3. Count the members of your household. Even if you have dependents that receive health coverage through KidCare or a spouse that receives group coverage (and you are ineligible for spouse's coverage), make sure that you are listing them as household members when quoting coverage. They lower the threshold for premium credits when accounting for your income. This can make a drastic difference.

4. Very important. Make sure you keep your income up-to-date throughout the year! As explained before, premiums are calculated largely by a person's AGI. If you are self-employed and your income varies from year-to-year or you switch jobs during the year, update your account to reflect the changes. If your income rises or falls significantly and you fail to notify the Marketplace, you could be shocked at tax time when you owe a portion of your premium subsidy back.

Medicare Supplement vs Medicare Advantage

Medicare Supplement (Medigap) Plans and Medicare Advantage Plans are both very popular options for Medicare beneficiaries who are choosing which benefit structure best fits their healthcare needs and lifestyle. However, I come across many beneficiaries who are confused or do not know the difference between these very distinct types of plans. In a nutshell, these plans can be considered like this: Medicare Supplements are in ADDITION to your Original Medicare benefits, while Medicare Advantage plans REPLACE your Original Medicare Benefits. While this is a simplified explanation, as there are many further distinctions between the two, this is the main one. Let’s explore the different a little deeper so that you might decide which option is best for you.

Medicare Supplements

Medigap (or Medicare Supplement Insurance, they are one in the same) are private health insurance plans sold to supplement Original Medicare benefits. They are designed to fill in the “gaps” of co-pays, deductibles and other costs that Original Medicare does not cover. There are 11 different Medicare Supplement plans to choose from nationwide (labelled Plans A, B C, D, F, HDF, G, K, L, M, and N). Each of these plans offer different levels of coverage for the out-of-pocket expenses that Original Medicare doesn’t cover. These plans have been standardized since 1992, meaning that the Medicare Supplement Plan that you purchase from (for example) Humana will be the exact same Medicare Supplement Plan that you purchase from Cigna, United Healthcare, United American, Thrivent, etc. Each plan offers the same benefits from each insurance carrier, and it then comes down to finding the plan that you select at the lowest price from the insurance carriers that offer the plan in your area. For example, in the Tampa Bay area of Florida, a Plan F (the most comprehensive of Medicare Supplement plans) for a female turning 65 (and first eligible for Medicare) can cost $179 a month all the way up to $265 a month. If this hypothetical individual hadn’t done their research and picked the least expensive insurance carrier afforded to them, they could spend over $26,000 extra for an identical plan over 25 years. As is the case with most lines of insurance, it is always best to consult with a broker when choosing a Medicare Supplement (Medigap) plan, so that they can inform you of all of your options and show you the best prices available in your area to choose from.

Medicare Supplement plans are distinct from Medicare Advantage plans additionally because they do not offer prescription drug coverage. A separate Medicare Prescription Drug Plan (PDP) must be purchased with a Medicare Supplement. Many people view this as a negative, as it is another purchase they must make, however there are often better pricing structures for prescriptions for beneficiaries when choosing amount dozens of competing prescription drug plans versus being stuck with the one that comes bundled with your Medicare Advantage plan.

Medicare Advantage

Medicare Advantage health plans could be considered a Medicare replacement plan. They are not in addition to Original Medicare, but take the place of it. In this type of plan, a private health insurance carrier administers your health benefits. Medicare Advantage plans must offer at least the same amount of coverage as Original Medicare and often provide additional benefits that Original Medicare doesn’t provide.

How can they afford to do this? CMS pays each Medicare Advantage carrier a fixed amount of money monthly to administer health benefits to Medicare beneficiaries enrolled in their plans. Medicare Advantage plans also utilize networks with contracted physicians, which can control costs but impact access to care.

Medicare Advantage plans generally replace the 80/20 co-insurance structure of Original Medicare with set co-pays. You might pay $15 to see a Primary Care Physician or $40 to see a specialist.

HMO Medicare Advantage plans restrict all access to care to within the plans network, except for emergency treatment. PPO Medicare Advantage plans also have a network, but beneficiaries can seek care outside of the network, albeit at a higher cost. Generally, HMO plans have a lower total annual cost than PPO plans, according to CMS.

Medicare Advantage plans most often come with prescription drug coverage included without an additional premium. Furthermore, certain Medicare Advantage plans will reduce the amount of premiums paid for Medicare Part B. In the Tampa Bay area, one plan offers a reduction of $131 of the $135.50 Part B premium.

Which Medicare Plans in Tampa Bay Received 5 Star Ratings from CMS for 2019?

The Centers for Medicare & Medicaid Services (CMS) created a Star Rating system to help beneficiaries and their families compare plan performance and quality for Medicare Advantage plans, Medicare Prescription Drug Plans, and Medicare Cost plans.

Medicare plans are rated on a scale of 1 to 5, with a 5-star rating being the highest score a plan can receive. More stars indicate better performance and quality:

• 5 Star Rating: Excellent

• 4 Star Rating: Above Average

• 3 Star Rating: Average

• 2 Star Rating: Below Average

• 1 Star Rating: Poor

For Medicare plans providing health coverage, such as Medicare Advantage or Medicare Cost plans, each plan is given an overall summary rating based on how it performs across five main categories:

• Staying healthy: Plans are rated on whether members had access to preventive services to keep them healthy. This includes physical examinations, vaccinations like flu shots, and preventive screenings.

• Chronic conditions management: Plans are rated for care coordination and how frequently members received services for long-term health conditions.

• Member experience: Plans are rated for overall satisfaction with the health plan.

• Member complaints: Plans are rated on how frequently members submitted complaints or left the plan, whether members had issues getting needed services, and whether plan performance improved from one year to the next.

• Customer service: Plans are rated for quality of call center services (including TTY and interpreter services) and processing appeals and new enrollments in a timely manner.

The overall rating gives a quick summary of a plan’s performance, but you can also look up how the plan scored for individual areas within the above main categories. For more information on the criteria Medicare considers when rating its plans, visit Medicare.gov.

So Who Made the Cut for 2019 in Tampa Bay

The 5 Star Rating from Medicare is not given out freely. In fact, only 4 Medicare Advantage plans of the 34 available in Tampa Bay received the designation.

• BlueMedicare Classic H1035-021

• BlueMedicare Classic Plus H1035-023

• CareFree H1019-060

• CareOne PLUS H1019-054

Multiple plans lost the 5 Star Rating from 2018 to 2019 in Tampa Bay, including the Freedom and Optimum plans that had received the high marks last year. While a 5 Star Rating is not the only indication of a satisfactory health plan and should not be your only consideration when deciding which plans might be best for you, it is a good indicator of the experience of previous and current members insured in the plan had. As plan performance changes from year-to-year, it would be prudent to review your coverage and plan during every annual enrollment period. How did your plan stack up from last year?

CMS Releases 2019 Medicare Premiums

The Centers for Medicare and Medicaid Services (CMS) has released premium information for Medicare Parts A and B in 2019.

The standard Part B premium is rising to $135.50, a $1.50 increase from the 2018 premium of $134. Some 2 million Medicare beneficiaries will pay less than the standard Part B premium due to a hold harmless provision where Medicare premiums cannot rise more than any yearly increase in social security benefits.

The annual deductible for Part B is rising to $185, a $2 increase from the 2018 deductible of $183. Premiums and deductibles for Medicare Advantage plans (MA/MAPD) and prescription drug plans (PDP) have already been released and are unaffected by this new information.

Medicare Part A does not have a premium for most individuals, but the hospitalization deductible has increased. For 2019, the deductible is $1,364, an increase of $24 from the 2018 deductible of $1,340.