June is 73 and still working part time for her county but expects to retire soon. She started Medicare parts A and B when she was 65 and has also had group health coverage through the county all these years. She will lose her group insurance when she retires, so she is exploring Medicare Advantage and Medicare Supplement plans.

The prices shared below are specific for the county where June lives, and factor in the costs of her specific prescriptions and medical needs. Your own scenario could look very different than this, but you can still learn from this analysis.

Since she has had creditable coverage  through her employer, she will not need to pay a late penalty for her Part D. She has a guaranteed issue window for a Medicare Supplement (meaning she won’t need to answer medical questions when applying), so we priced that option. She takes some expensive medications that would cost about $1163 per year MORE on a stand-alone Part D plan that she would need to buy with a MediGap plan than these same drugs would cost on a Medicare Advantage plan that includes prescription drugs. June is used to using in-network providers and no longer travels since her husband has Alzheimer’s. Thus, the flexibility that Medicare Supplements offer is not important enough to her to pay all the extra costs.

We weighed the DEFINITE costs of the Med Sup package against the POSSIBLE costs of the Medicare Advantage plan and June decided to go with Medicare Advantage to save money up front.

Medicare Supplement Costs for June

  • Plan G $116.77 per month = $1401.24 for 12 months
  • Drug Costs (premium + medications) = $2243 for 12 months
  • DVH Plan ($1500 benefit level) = $596.04 for 12 months
  • Total annual costs of $3,143.58 with Med Sup, not including Part B premium of $148.50 per month or the Part B deductible of $203 per year.

Medicare Advantage costs for June

  • Medicare Advantage with Prescription Drugs that includes DVH coverage: $1080 per year.
  • This includes the cost of her prescriptions but does not include co-pays that she’ll make when she visits a specialist and receives other treatment and testing.
  • The maximum out-of-pocket for her plan is $4,900, but she is not likely to reach this amount unless she gets cancer or has multiple stays in the hospital.

Some employers require employees over 65 years to enroll in Part B insurance in order to stay in the group plan; however, other employers consider Part B optional. In this case, June has been paying her Part B premiums unnecessarily for 8 years—well over $10,000 that she didn’t need to spend.

Each senior who has group insurance needs a thorough analysis to make a smart decision about group insurance vs. Medicare. Some employer groups offer choices and others do not. Some people will determine Medicare is a better value and others will come to the opposite conclusion. It really depends on the costs of group insurance and the costs of a Medicare solution in your community.

If you need help making a decision about group insurance, make an appointment so we can weigh all the costs and come up with a plan that’s best for your situation.