In all likelihood, many financial advisors rush past the Medicare Annual Enrollment Period (AEP), unless they themselves are over age 65 and flooded with mailers about plans.
Medicare season probably doesn’t come up a lot with your clients either. They may think that Medicare is only health insurance and not an important financial decision as well.
Most Medicare beneficiaries tend to pick a Medicare plan and stay in it for good. Only 5 percent of Medicare beneficiaries said they anticipated making changes to their Medicare coverage, according to the Allsup Medicare Advisor Seniors Survey. Only 13 percent of Medicare beneficiaries change their Part D prescription drug plans, according to an Issue Brief from the Kaiser Family Foundation last October (“To Switch or Not to Switch”).
It’s not like financial planning, is it? You design a financial plan for your clients, and you take care to adapt it for shifting economic factors, investment performance and lifestyle changes. However, all of these factors also apply to and impact Medicare plans, premiums and coverage.
What we’ve found through several years of survey and data collection is that many people simply are intimidated and feel it’s safer not to “mess with” their current Medicare coverage selections. So they accept increases in their costs and changes in coverage, as if it is their only option. Unfortunately, this means that potentially hundreds of thousands of people are making do with healthcare coverage that is inadequate or more costly than necessary.
Of course, helping clients get ready for Medicare as they approach age 65 is a critical time. But AEP is the best time for a review and course correction—when coverage and premiums change, and opportunities for “new investments” in healthcare present themselves. You may not consider yourself a Medicare expert, but you can help clients by correcting some basic misperceptions and misunderstandings during AEP, Oct. 15 through Dec. 7, 2014.
Figuring Out What Clients Really Pay For May Seem Impossible
Indecision and poor decisions happen because of the complexity in figuring out what coverage a client really needs to pay for and what it really costs them. It’s easier for them to take a leap of faith by planning for anything to happen or convincing themselves that their health won’t change.
But Medicare decisions are about analysis and risk, and financial advisors are pros at assessing and managing risk. The truth of the matter: With your help, it is possible to reach a fairly accurate assessment when examining Medicare expenses.
Yes, there are a variety of terms and totals to calculate, including premiums, co-pays, coinsurance and deductibles, as well as cost-sharing and discounts. But working with a Medicare plan selection service can make this a lot easier for non-experts, yield realistic estimates and make cost comparisons possible.
Look for a plan selection service that provides side-by-side comparison of plans and choices and a clear display of monthly and annual costs. These services can help by walking through anticipated medical treatments and out-of-pocket costs in the coming year as well. Allsup Medicare Advisor even makes available a free cost analysis to the customer’s financial advisor.