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Medicare Update

Some hard-working, taxpaying Americans get angry when they hear Social
Security called an entitlement program, perhaps because the word “entitlement”
has come to have a connotation with welfare programs. The reality is that
Social Security is, by definition, an entitlement program, along with Medicare,
unemployment insurance and worker’s compensation. These mandatory programs are
funded by people who work through their payroll taxes, so they are eligible for those benefits through
those tax contributions.1

These programs differ from the nation’s six major welfare programs:
Medicaid, Temporary Assistance for Needy Families, Supplemental Nutrition
Assistance Programs (SNAP), Supplemental Security Income, Earned Income Tax
Credit and Housing Assistance. These needs-based programs are funded by federal
revenues and administered at the state level.2

Federal government benefits for long-term care fall under
the welfare umbrella of Medicaid; beneficiaries must meet certain low-income
requirements. This leaves higher income retirees — who may have diligently
saved for their retirement needs —to have to pay for long-term care costs
because Medicare, in general, limits what it will cover.3 The odds are high that you or a loved
one will need long-term care; someone turning 65 today has almost a 70% chance
of needing some type of long-term care in their remaining years.4

This kind of care can be expensive: The median cost of a
private room in a nursing home is $102,200 a year.5 There are
insurance options to help pay for potential long-term care expenses; if you’re
interested in learning about these options, contact us for more information.

There’s good news for some Medicare beneficiaries who need
help caring for themselves at home: People who purchase a Medicare Advantage
(MA) plan now may have more options for household assistance benefits. In 2018,
Congress passed legislation that enabled MA plans to pay for some non-medical
services for chronically ill members, such as coverage for grocery delivery,
caregiver support and retrofitting homes with things like wheelchair ramps.6

The new legislation left it to
plan providers to decide what types of supplemental assistance benefits to
offer. Insurers have come up with some interesting offerings. For example,
Anthem offers Medicare Advantage plans with coverage options for quarterly pest
control, an allowance to help care for a service dog, access to acupuncture or
massages, sessions with a dietitian or up to 64 healthy food deliveries per
year.7

This year’s Medicare annual
enrollment period runs from Oct. 15 through Dec. 7. It’s a good idea to
comparison shop for plans with new options, or at least find out if anything
new is covered in your current plan.

Content prepared by Kara Stefan
Communications.

Kimberly
Amadeo. The Balance. Aug. 27, 2019. “US Welfare Programs, the Myths Versus the
Facts.” https://www.thebalance.com/welfare-programs-definition-and-list-3305759. Accessed Oct. 5, 2019.

2 Ibid.

3 LongTermCare.gov. U.S. Department of Health and Human
Services. “Who Pays for Long-Term Care?” 
https://longtermcare.acl.gov/the-basics/who-pays-for-long-term-care.html. Accessed Oct. 14, 2019.

4 LongTermCare.gov. U.S. Department of Health and Human
Services. “How Much Care Will You Need?” 
https://longtermcare.acl.gov/the-basics/how-much-care-will-you-need.html. Accessed Oct. 14, 2019.

5 Genworth. “Cost of Care Survey 2019.” https://www.genworth.com/aging-and-you/finances/cost-of-care.html. Accessed Oct. 18, 2019.

Robert
Pear. The New York Times. June 24, 2018. “Medicare Allows More Benefits for
Chronically Ill, Aiming to Improve Care for Millions.” https://www.nytimes.com/2018/06/24/us/politics/medicare-chronic-illness-benefits.html?module=inline. Accessed Oct. 5, 2019.

Shelby
Livingston. Modern Healthcare. Oct. 4, 2019. “Medicare Advantage insurers tout
pest control, acupuncture among new 2020 benefits.” https://www.modernhealthcare.com/insurance/medicare-advantage-plans-get-creative-2020-benefits. Accessed Oct. 4, 2019.

Our firm is not affiliated with the U.S. government or any governmental
agency.

We are an independent firm helping individuals create
retirement strategies using a variety of insurance and investment products to
custom suit their needs and objectives. This material is intended to provide
general information to help you understand basic financial planning strategies
and should not be construed as financial or investment advice. All investments
are subject to risk including the potential loss of principal. No investment
strategy can guarantee a profit or protect against loss in periods of declining
values.

The information contained in this material is believed to be
reliable, but accuracy and completeness cannot be guaranteed; it is not
intended to be used as the sole basis for financial decisions. If you are
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