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4 Things You Must Know If You’re a Traveler with Medicare
Retirement is exciting! You’ve worked 40+ years and now you have the time to do all the things you said, “One day…” to. For many, traveling is the number one item on their retirement bucket list. If you’re turning 65 or are already on Medicare, here are four things you should know to make the best decision for your post 65 lifestyle.
Traditional or Original Medicare
Traditional Medicare is accepted everywhere in the United States and certain territories (like Puerto Rico and the U.S. Virgin Islands) by facilities and doctors who accept Medicare. The problem is that Original Medicare is an 80/20 plan, with deductibles and no MOOP (Maximum-Out-Of-Pocket Limit). What this means for you is that if you go the Traditional or Original Medicare route, it can become extremely expensive.
For example, if you were to be hospitalized, you would need to pay your $1,484 deductible (for 2021) before Medicare pays anything. Then you are liable for 20% of the bill. If a bill were $10,000 or $50,000, you will pay $2,000 or $10,000, respectively, since there is no MOOP. So, plan wisely.
MediGap (Supplements)
If you plan to be an avid traveler, MediGap Plans are a fabulous option. The most popular is Plan G, which includes all deductibles, copays and coinsurances except for the Part-B $203 (for 2021) deductible.
Since MediGap plans are transparent (in other words, Medicare automatically bills them for the portion you would normally pay, so you’re not bothered), all you do is present your Medicare card and the provider does the rest. But there is a caveat. They can be expensive, on average about $200 per month. They do not include Part D, so you would require a prescription drug plan to complement your coverage. Also, they do not include dental or vision. New Plan G+ plans are being developed to include limited dental and vision.
When you consider the cost of $148.50 for Part B, on average $200 for MediGap and an average of $30 for a Part D plan, it can add up to a whopping $378.50 per month, regardless of whether you use the coverage or not. If it’s in your budget, it provides the most flexibility. But if you didn’t go with a MediGap plan when you turned 65, you will have underwriting to contend with, which may make the premium higher.
Medicare Advantage PPO
A Medicare Advantage PPO plan, with the right carrier, is more cost effective. Since it’s a Medicare Advantage plan, it most likely will include prescription drugs, dental, vision, hearing and over-the-counter allowance (which is money in your pocket for the items you may typically purchase at CVS, Walgreens and Walmart, shipped directly to your home), you don’t need to purchase any additional coverage. Most plans have a $0 premium, so the only cost is the $148.50 for your Part B. However, they do come with higher copays, deductibles and coinsurances than the more popular HMO plans.
With that said, certain PPOs (like UnitedHealthcare’s Passport plans and Humana’s Local PPOs), allow you to use your plan wherever they have a network. While it doesn’t provide total coverage wherever Medicare is accepted, it allows you to use it in-network in multiple locations. If you need to step out of the network while traveling, you won’t get stuck with the entire bill.
Medicare Advantage HMO
If you’re comfortable with emergency and urgent care while traveling only, the most cost-effective plan is an MAPD HMO (Medicare Advantage with Prescription Drugs plan that is an HMO). This is the most popular, for the bang for the buck it offers. HMOs typically have lower deductibles, copays and coinsurances, and some plans even give a Part-B premium credit or rebate. This can vary from $30 to $144 per month returned to your social security check.
The key thing you must know before choosing an HMO, with the exception of an HMO POS (which offers limited out-of-network benefits), you will have to stay in network, with the exception of emergency or urgent care.
So, if you are relatively healthy and do not plan to be a wanderer; but rather, you intend to live in your domicile for six months or more out of the year, getting all your routine healthcare taken care of at home, this is an excellent option.
Therefore, make sure to take into consideration your lifestyle and bucket list when choosing a Medicare option. This way you can enjoy your retirement and not worry you will have any medical billing surprises.
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