2019 Medicare Updates

Written by Kelly S. Olson Pedersen, CFP®, CDFA

Trying to understand Medicare can be confusing and overwhelming. We have some resources to help make it a little easier to understand.

The first resource you should check out is the Medicare & You guide. This document does a great job of explaining Medicare and what options and plans are available.

Some changes to note:

• The Medicare Part B monthly premium, which since 2007 is based on the beneficiary’s income, is increasing from $134 per month to $135.50. This monthly premium ranges from $135.50 at the lowest tier to $460.50 at the highest tier. Medicare deductibles have also increased.
• Starting January 1, 2020, Medigap plans sold to new people with Medicare won’t be allowed to cover the Part B deductible. Because of this, Plans C and F will no longer be available to people new to Medicare starting on January 1, 2020. If you already have either of these two plans (or the high deductible version of Plan F) or are covered by one of these plans before January 1, 2020, you’ll be able to keep your plan. If you were eligible for Medicare before January 1, 2020, but not yet enrolled, you may be able to buy one of these plans. Click here for more information
• If you are enrolled in a Medicare Cost Plan in Minnesota, the Centers for Medicare and Medicaid Services (CMS) won’t allow Medicare Cost Plans (starting January 1, 2019) in counties where:
• There were at least two competing Medicare Advantage plans available the previous year
• These Medicare Advantage plans had at least a minimum specified number of members during the entire previous year.

These plans will be discontinued as of January 1, 2019. Here are a few options:

• If you want to enroll in a Medicare Advantage planbefore your coverage ends, you can sign up during the Annual Election Period (AEP), October 15 – December 7.
• If you want to return to Original Medicare, Part A and Part B, you can do this during the Medicare General Enrollment Period, which runs from January 1 to March 31 each year.

Read more about how these plans are being phased out: Medicare Cost Plans Being Phased Out in Minnesota

What’s happening with the “donut hole”?

An expensive element of the Medicare Part D prescription drug benefit requires enrollees with high prescription costs to pay more for their medicines after they reach a certain level of spending in one year. This creates a coverage gap – also called the “donut hole.” After a beneficiary’s out-of-pocket spending reaches a second threshold, they enter catastrophic coverage and pay substantially less. Under the Affordable Care Act (ACA), the donut hole was scheduled to close in 2020. But the spending bill Congress passed in March will close the donut hole for brand-name drugs in 2019. The gap will close for generic drugs in 2020. Click here to read more on this topic.

Check out the Medicare.gov Plan Finder to view and compare plan options.  If you need assistance choosing a new plan, please let us know and we can connect you to a specialist.

Caissa Wealth Strategies is a fee based registered investment advisory firm, specializing in personal, dynamic wealth management. Based in Bloomington, Minnesota, Caissa financial planning professionals provide individualized strategies for every client. You can expect more from CAISSA, and in turn, you will get a fiercely loyal advocate on your side. For more news and information on wealth management solutions, visit Caissa Wealth.