Major FEHB and Medicare Changes Coming... Game Changers!

all right ladies and gentlemen federal employees welcome to this episode this episode is a special one where you don't just have to listen to me you're probably sick of my voice at this point I have a guest we have Kevin Moss from checkbook many of you have used checkbook there's some big big changes coming to fehb Medicare party tons of things that especially as you're approaching retirement or in retirement if you're an annuitant there are some big big big big things coming and that's why we have an expert here Kevin with us to talk through all the big things so Kevin right off the bat give the listeners give the viewers here a snapshot of what's happening what changes are coming into play and how that might affect them sure well thanks for having me darling uh I so last summer the inflation reduction Act was passed maybe a lot of people missed actually what was actually in that legislation but there was some important part D reforms that were in that legislation that have started rolling out actually already this year and so the big things that are updating are insulin is being capped at no more than 35 dollars a month from all party plans now Part D plans don't have to cover all brands of insulin but they do have to cover at least one dosage form vile or pen and each insulin type rapid acting short acting intermediate acting or and long acting so those insulin caps are already in place on Part D plants that was front loaded in this legislation that's out this year and then next year uh catastrophic coverage coinsurance is being eliminated now many people if they had Part D would never get to this stage there's a lot of cost to to make it to that stage it's seventy four hundred dollars between the enrollee the drug manufacturer and the party plan but you're still on the hook for five percent of all charges if you if you make it to of the catastrophic coverage phase that's being eliminated then next year Part D premiums are being capped um they can they can't grow more than six percent on any given year this lasts from 2024 to 2030 and that six percent it you know it's it's less than for example the fehb premium increase from this past year and when we look at the average Part D premium increase it was 10 percent last year so six percent is is actually a reason you know no one wants to pay more money but it is some important protection that these enhanced benefits aren't going to lead to much higher premiums but the big one that's coming and it's you still have to wait a year and a half or so for this but starting in plan year 2025 there's going to be a new two thousand dollar out-of-pocket spending a cap in all Part D plans where you will not have to pay more than two thousand dollars out of pocket for any prescription drugs and importantly in this uh new rule you can spread that two thousand dollars over the course of a year which really I think helps with your budgeting that you will not have to pay any more than a hundred and seventy dollars a month for prescription drug coverage out of a Part D plan this is coming in 2025. so that two thousand dollar out of pocket spending cap is much much lower than what we see from most fehb plans where that catastrophic cat for a self-lo or excuse me a self and only enrollment can be as low as 1500 but as high as 9 100. so any federal annuitants that have average or high prescription drug costs they manage chronic conditions or they're treating you know cancer or some other diseases this is going to be really important for you to be monitoring um part D right so so and just so everyone listening it makes her all on the same page we're talking about Part D which of course is part of Medicare which for many of you out there you may be confused you're like well as as FBA people in feh be federal employees I thought we really never had to be in part D because fehb cover that so Kevin for those folks that are asking themselves that question of hey I thought for as federal employees we really only wanted to consider Medicare A or Medicare B why are we talking about Part D how does that affect federal employees and federal annuitants what do you say to those folks yeah down you're right historically Part D did not make much sense at all for any federal new attempt to join um you know the the what's true is that the prescription drug coverage from almost all fehb plans was at least as good or in many cases better than what you could get from a Part D plan and importantly you didn't have to pay an extra premium in order to get it it came with with your regular Health Plan premium so it didn't make a lot of sense to take part D but now it will and we we kind of have a signal that's out there already every year OPM puts out a call letter to the carriers where they put the goals of the next open season of what they'd like to see the carriers do and they are encouraging the carriers to start including these new Part D benefits into plan options that are available to annuitants and so expect to see a lot of new plan options starting this fall got it so what sort of plan options because I know certainly um on the Channel people regular viewers here I've talked about a number of plan options that tend to work well with Medicare right very very many federal employees love Blue Cross Blue Cross basic of a course pays for part of Medicare Part B premiums which I mentioned many many times here on the channel there's other plans I mean what sort of plans should people be looking out for that are coming that they may may be better than what they have now what sort of things should they be looking for sure well there's going to be two delivery mechanisms for Part D uh let's talk about the first it's fehb Medicare Advantage plan so this is this is part C uh another letter of the alphabet so this is fehb Medicare Advantage plans now these Medicare Advantage plans these aren't the same plans that Joe Namath is talking about when you're watching a commercial these are offered by fehb plans there are a handful that have been around now for three or four years offered by fehb carriers like Aetna in Kaiser and United the only way that federal employees and annuitants knew about these plans they're in the back of the 120 page fehb plan brochure and of course we at checkbook have been evaluating them and they're part of our plan rankings and our guide to health plans for federal employees it's these are great plans I have to tell you darling um because they do some things that can't be found in just fehb plans with original Medicare so for one uh all of these fehb Medicare Advantage plans have Part B rebate mechanisms but but some of the rebates that come back to their enrollees are much higher than what we see from something like Blue Cross basic for example the United plan for example it's a hundred and fifty dollars back it's almost the entire Part B premium that's being rebated back to you and importantly zero dollars per out of pocket health care expenses when you see a provider that accepts Medicare and the only thing you you're left to pay is prescription drug costs and now with these Part D reforms you're out of pocket prescription uh drug costs are going to start going way down so these plans are are really great plans they have been great plans for a while they're probably the least expensive plan for most folks um and expect to see more in the future OPM is now asking carriers to offer more of these Medicare Advantage plans now they may not be the right plan for everyone though Darwin so there's something called Irma which I think you've talked about before on on your channel and from your previous videos where if you're fortunate enough to be a high income individual Medicare would like to see you pay a little bit more for Your Part B premiums and in this particular scenario because part D is packaged into this Medicare Advantage plan you get hit with Irma twice you get the part B Irma hit and you get a part D Irma hit so if you are subject to Irma and you expect your high income to persist throughout your retirement you may want to think twice about these Medicare Advantage plans because the financial value of joining them is going to erode due to your higher premium a couple other things to to keep in mind is that if you spend a large amount of time overseas these medic fehb Medicare Advantage plans don't have routine Health Care overseas besides the United Healthcare plans those still do have routine overseas health care but um because you don't leave your fehb plan you still have to pay your fehb premium when you join one of these plans you still have your emergency overseas coverage that every fehb plan provides and then the final word of caution is the plans will say that you can go to any provider that accepts Medicare but there are some examples where certain provider networks may be excluded so you do want to do your homework double check check those provider networks provider directories for any providers that are important to you to make sure that you'll be able to continue to see those providers yeah no great points I think I think I agree 100 watch out for your if you're a high earner maybe it doesn't make sense make sure the doctors you want to work with make sure it all works right for your situation but so Kevin I I talked to hundreds of federal employees um personally of course thousands and tens of thousands of people uh via YouTube and all these different places and I get pushback all the time and people say hey look I've been I've been on my Blue Cross planner I've been on this plan my entire career why in the world should I jump to MediCare at all when I turn 65 my plan has been great and what you have said so far I hope all the viewers here just just really listen where it's like look with these changes especially it has there's tons of advantages on being Medicare A B maybe getting a fehb Medicare Advantage plan where the again there is basically no out-of-pocket costs as long as you go to providers that you know um accept Medicare and those things um and the total premiums is are very very low so certainly everyone out there definitely find a plan that makes sense for you but definitely look into Medicare these Medicare Advantage plans as you get closer Now Kevin I know before we started recording today you talked about comparing Blue Cross standard which is a classic right in the federal employee and a new intense community and you were comparing that to some other Medicare Advantage plans and the costumers I want you to tell the viewers again they didn't catch that because we weren't recording earlier please tell them kind of what you found when comparing some of those plans yeah sure so yeah Dallin was asking me about Blue Cross standard and you know what would I say for people people who love Blue Cross standard and I will say blue cross's standard is an amazing plan it gets very high customer service marks It generally has a very deep provider Network it's a plan that allows you to go out of network it has a very deep formulary where they cut they're covering many prescription drugs and then I can also say that it's one of the most expensive plans available to federal employees and so one thing that we do in the guide to health plans for federal employees is we model total costs you know what you pay for health insurance isn't just premium but it's your also your expected out of pocket costs and when we know the primary age and we know your expected Health Care usage we can run Actuarial modeling and look at what total cost would look like for folks like you and in the DC area we looked at a couple with some plus one enrollment where the primary insured was age 70 8 and their income was below the Irma threshold and our modeling suggests that you could save almost eight thousand dollars a year switching from Blue Cross standard to the United Choice primary retiree Advantage plan and that is a lot of money and so you may be happy with Blue Cross standard but if you're one of those annuitants that have been on that for a while and you haven't looked at other plan options these new Medicare Advantage plans haven't been around for a while and perhaps you haven't looked into them and you know the one thing that's great about the fehb system is that you only have to live with your plan for a year um not that there's not risk if you go to a plan and it doesn't work out for you that you may uh you know not have some stress and and and perhaps you know a bad outcome from a plan that doesn't cover what you need but these plans have have great coverage they have deep provider networks for you know if if they if the provider accepts Medicare in most cases it's uh your care is going to be covered in these plans and just a tremendous amount of savings in these plans so take a look there's going to be even more uh this fall your job has only gotten harder sadly given all the options and complexities that are out there yeah no that is right on that is right there's so many options so many options out there and I can see why many federal employees find a plan that works for them and they never change because there's so much out there like where do I go to look and so for those listening there's really two places I would go right OPM has a tool it's free but it's not very good where it Compares different fehb plans and some of the the key aspects there but honestly checkbook so Kevin is at checkbook.org did I get that right uh it's guide to healthplants.org we're the non-profit that publish it publishes it but it's guide to healthplans.org uh dozens if you're active federal employee dozens of federal agencies are providing free Access Health and Human Services State Department Labor education USPS you can go and check to see if your agency provides free access and then we hooked up your viewers down with a little uh discount code um we the the guide itself is is not that much it's only about I think like 13.95 not about that is what it is it's 13.95 but your viewers have a discount code it's uh Hawes FP um and you enter that at checkout you'll save 20 so that goes down to like 11 and change the 2023 guide is out now and then right before Open Season we'll drop the 2024 guide perfect perfect well we certainly appreciate the discount we'll take everything we can get for our viewers here we appreciate that so again check that out I know when this is going to be this video is going to be coming out it's not going to be open season quite yet but this is when for all of you listening you need to start percolating on this side you need to start thinking about this stuff because if you don't think about it until November then it's going to be much harder to make a decision at that point having a game plan going in is going to make all the difference and we're going to be doing lots of videos just like this on fehb giving you information you need to make the most most of this decision for you and like Kevin said it can be the difference of eight thousand dollars and while coverage necessarily doesn't um change that much depending on the plans you're in so um thank you for for listening everyone thank you for spending time with us today and we'll see you guys next time

Channel: Haws Federal Advisors

Views: 47,266

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Id: O5NLXVjsB0E

Length: 16min 26sec (986 seconds)

Published: Fri Mar 31 2023