Medicare Advantage is also known as Part C of Medicare. Medicare Advantage covers all parts of original Medicare.
Part A covers inpatient hospital care, care in skilled nursing facility, hospice, home health care
Part B covers medical expense, outpatient services, medical supplies, and preventive services
Part C is a type of Medicare health plan offered by a private insurance company that is contracted with Medicare. This type of Medicare health plan provides all of part A and part B benefits and many include part D.
Part D covers prescription drug coverage
Some Medicare Advantage plans offer value added benefits such as, vision, hearing, dental and fitness benefit. Medicare Advantage plans are cost effective plans with a low premium that offer value with additional benefits. More than one third of Medicare individuals are enrolled in Medicare Advantage plans in the US.
As of 2017, 33% or 19 million beneficiaries is enrolled in a Medicare Advantage plan. There has been a steady growth in Medicare Advantage plans over the past decade. Kaiser Foundation says the enrollment growth is continuing despite the Affordable Care Act of 2010. The average premium for Medicare Advantage in 2017 was $36 per month (2017).
A Medicare Supplement plan is offered by a private insurance company; the plan is also known as a Medigap plan. Medicare supplement plans cover the out-of pocket costs that Original Medicare does not cover such as, coinsurance, copayments, and annual deductibles. Things you should know about Medigap policy:
- You must have Part A and Part B
- If you have a Medicare Advantage plan, you must make certain you can drop the plan before purchasing a Medigap plan.
- You must pay a monthly premium for the Medigap in addition to Part B premium.
- You can purchase a Medigap plan that is offered in your state.
- Medigap plans do not cover long-term care, vision, dental prescription drugs, eyewear, and hearing aids.
Medicare Supplements offer standardized plans. Plan rates vary in different states.
A, B, C, D, F, G, K, L, M, N
Today, the average cost of a funeral in the United States can cost up to $10,000. When factoring the price of headstone, casket, and burial plot along with the funeral service itself, the cost can be pretty expensive. It is wise to prepare in advance for a burial. A good investment is to purchase a senior final expense policy.
Senior final expense plans are permanent life insurance designed to cover immediate expenses related to funeral, burial and medical bills. These policies are typically guaranteed issue, never expire and have a level premium. Guaranteed issue is a great option for those that have been denied life insurance in the past. The death benefits for senior final expense plans are below:
- Death benefit range from $10,000 to $25,000
- Policies will cover an insured up to age 121
- Proceeds for paying off final expenses and debt.
- Supplement to other life insurance
- Qualification if with adverse health conditions
- No medical exams
- Guaranteed issue
- Coverage issued quickly
What to consider before buying final expense insurance:
1. It is important to decide on what type of coverage to obtain.
2. Once you have decided on what type of coverage, then decide upon the appropriate amount of death benefit.
3. The financial strength of the insurance company and claim paying history.
4. Information on insurers can be found from agencies such as, A.M. Best and Standard & Poors; it is good idea to stick with an A rating or better.
Life insurance statistics in blog STATISA (2016) show the following:
The total number of life insurance policies in force in the U.S. 290.65m.
The total percentage of Americans without life insurance is 66%.
Biggest reason for owning life insurance in the U.S. is to cover burial and other final expense.
A supplemental health plan is a healthcare plan that covers anything above and beyond minimum essential medical coverage. Hospital Indemnity, Cancer, Accident Health, Short term health, and Dental insurance are offered as supplemental plans by private carriers. Cancer supplemental health plan will pay a lump sum amount if the person is diagnosed with any type of cancer diagnosis. If you cannot afford long term care insurance, then critical illness supplemental is a good investment. Private insurance companies offer these plans and they are not offered by ACA healthcare marketplace.
Some things to consider before purchasing supplemental health insurance:
- Your health risk factors
- Your savings
- How much insurance you can afford
It is always wise to make sure you get a good health insurance policy that pays you maximum benefits for a good price.
Whole life products are permanent plans that have a cash value component. When you purchase a whole life policy you will pay a fixed premium for as long as you live or as long as you keep the policy in force. In addition, the policy builds cash value that accumulates tax deferred.
What do you get with a properly designed whole life insurance (Jamieson, 2014):
1. Principal protection protects your money. Your cash value is not subject to market losses.
2. Guaranteed growth of your money every year. This is interest rate driven based on the economy. This is compound tax-free growth and not the average rate of return you get with mutual funds.
3. Dividends paid to policy owners are not taxable.
4. A high starting cash value amount based on what you contribute to the policy.
5. Access to your cash value at any age at any time or any reason without taxes or penalty.
6. The ability to use your account’s cash value to recapture lost depreciation on major purchases and interest and fees paid to banks.
7. Guaranteed insurance. Once the policy is in place it is guaranteed for the rest of your life.
8. The funds inside the policy are tax-free for life.
9. Death benefit
Best selling author John Jamieson says, “There is a reason why family dynasties have been using life insurance for generations to grow and protect their wealth… these death payouts go a long way toward promoting the tax –free, inter-generational transfer of wealth” (2014).