Those of you who have reached or are approaching age 65 have an extra decision to make regarding our Open Enrollment. You are or soon will be enrolled in Medicare Part A, which is free and automatic for U.S. citizens. This covers hospitalization, nursing homes, skilled nursing facilities, and some home health. This does not impact your group insurance decision at all.
What is an issue is whether or not you should take Medicare Part B, which covers physicians, outpatient procedures, and durable medical equipment. Part B must be elected and will cost you, for this year, at least $1,384.80 for the next 12 months. In our opinion, and that of our broker Corporate Benefits Alliance, this coverage will not pay more in benefits than you'll pay in premium (see chart).
Now before your eyes gloss over, let's walk through it.
Medicare pays 80% (you pay 20%) after a $162 deductible. Medicare is always the payer of last resort, but it will pay its portion between the $162 Medicare deductible and the $1,200 Blue Cross deductible. That totals $830 in benefits ($1,200 - $162 deductible = $1,038 x 80%).
After you've reached $1,200 in medical bills your Blue Cross insurance kicks in at 80%, making Medicare secondary. In the coordination of coverage rules for Medicare, it will pay whatever Blue Cross does up to the limits of Medicare's coverage. Because Blue Cross pays 80%, and Medicare pays 80%, Medicare will pay nothing else. You pay 20% until your total out of pocket reaches $8,800 (a rarity)and then Blue Cross pays 100%.
The coordination of these two coverages means that you'll pay $567 more in Part B premium that you'll ever receive in benefits.
Bottom line: if you have Parts A and B you don't need to elect our coverage. If you have Part A and want a Blue Cross High Deductible Plan you should not elect Medicare Part B.