7 Common Mistakes Starting Medicare
7 Common Mistakes Buying Medicare Coverage
You are about to start Medicare and are overwhelmed by the amount of information. It happens to everyone. Before you pick out your Medicare coverage, here are the 7 most common mistakes I see people make when starting their Medicare coverage so you can avoid them.
Buying a plan based solely off friend’s advice
I see this one a lot. And it makes sense. Because people rely on friends that have been in that situation before. And they are your friend so you trust them. But you don’t know how they made their decision for their Medicare coverage. So should you blindly buy what your friend “Jon” bought even though you may be in a very different situation than “Jon?”
You can absolutely ask your friends for advice. But please don’t take that advice blindly. Here’s a good example of what can go wrong if you do that.
I helped a guy get a Medicare supplement plan recently. When I first met with him, he told me about his friend who recommended he go with a company named Physician’s Mutual. I offered to review them along with the rest of the carriers in Wisconsin. As he looked at the monthly premiums for the same plans he realized Physician’s Mutual was really expensive compared to other options.
Based off that he chose a different company that provided him with big savings. And he got the plan he wanted. But what really made this interesting was that he referred me back to his friend who told him to just sign up with Physician’s Mutual.
So I met with him and did a policy review. We then compared his current plan with other options. He realized he was able to change his coverage to a new Medicare supplement company and save more than $800 per year. For IDENTICAL coverage.
He keeps all of his same doctors.
Zero change in benefits.
And he keeps more than $800 in his pocket instead of sending it to an insurance company.
So he was referring his friend’s to a company that would cost them more than $800 each and every year. Obviously he wasn’t doing this to be mean. But he didn’t know any better. Which is why this is a big mistake that people make buying their Medicare coverage.
Believing Medicare Covers Everything
Medicare has gaps. It does not cover everything. Even the things that are covered by Medicare are rarely covered at 100%. Which means you have to pay extra money. But how can you best prepare for this?
Because some of these gaps are quite large. Others are smaller. But just because they are smaller doesn’t make them unimportant. So what’s important to you?
Do you mind paying for deductibles or copays? Or would you prefer an insurance company took care of those costs for you?
What about paying 20% of some unknown medical bill? That’s frustrating when you get treatment and then a month or two later start getting bills. Which is when you finally learn how much your treatment actually cost.
Then there are other things that Medicare doesn’t cover at all. Things like:
- Dental
- Vision
- Long Term Care
It’s important to realize that Medicare doesn’t cover everything. And knowing what the gaps are is key to you being able to make a good decision on what gaps you are okay having.
Not knowing what you are buying
Medicare Supplements. Medigap. Medicare Advantage. I know it’s confusing. And this is before we get to the insurance acronyms.
But you need to know what you are buying BEFORE you actually buy it. Otherwise it’s going to be an unhappy lesson when you go to use your plan.
Medicare supplements and Medigap plans are the same thing. They are standardized so they are easier to compare. They also fill in the gaps of Original Medicare.
Medicare Advantage is very different. It actually replaces how you get your Medicare coverage. So you get your Medicare coverage from an insurance company instead of Original Medicare.
So before you buy you need to know things like:
- Can I see any doctor?
- Which doctors can I see?
- Do I have extra costs when I use my plan?
- Do I need to get referrals to see a certain doctor like a specialist?
- Can my plan be changed from year to year? Or cancelled?
If you don’t know these answers then you are not ready to buy your Medicare coverage yet.
Relying on a volunteer or a salaried person for advice because they are unbiased
First off it’s important to understand that just because someone isn’t compensated based off buying a plan doesn’t mean they are unbiased. They likely have a strong bias based off where they were trained.
Of course that makes the assumption that they were trained. Do you know how or if they were trained?
Hopefully it wasn’t a one day course or an online training…
Isn’t it more important that someone have a vested interest in you being happy with your plan? Because ask yourself what happens if six months after buying a plan based off a volunteer’s advice you find out you don’t like it.
Is that volunteer going to be able to help you? Are they still going to be volunteering there? How will you get in contact with them?
Are they licensed so to provide you with guidance? How long have they been licensed?
Do they have an obligation to help you in the future if you are unhappy with the choice you made based off THEIR recommendation?
Compared with an insurance agent like myself. Yes, I get paid for helping you choose your plan. No, I don’t cost you anything.
As an independent Medicare insurance agent, can offer you just about any company. So my goal is to help you find the coverage you are looking for from a company that fits you. I’m not biased towards any one company because they all pay me about the same. That means my interests are you picking a plan that you are happy with. So you keep it. Because that’s how I earn a living.
And if you decide in the future that you aren’t happy then you should reach to me right away. So we can solve the problem together. Because my interests are aligned with yours.
Which is you being happy with your plan both now and in the future.
Buying direct from insurance company to cut out the middleman and save money
When you decide to buy coverage from an insurance company you have many options to buy that coverage. Some of these are:
- Using an independent agent
- Using a captive agent (someone who can only offer that 1 company)
- Calling that company’s 1-800 number and signing up over the phone
- Enrolling yourself on the company’s website
You can use any of these and probably other methods. But the price you pay for that policy from that company will be the same regardless of how you buy. This is important to understand for several reasons.
But a big one is that you can use an independent agent like myself that has 10 plus years of experience FOR FREE! You don’t pay 1 dollar more for access to the knowledge I have gained over my career.
And if you have an issue later on or maybe just a question. You can call me. Not someone in a 1-800 call center, sitting who knows where, who you have never talked to before. And will probably never talk to again.
And if you use a captive agent then they have a biased interest in selling you that plan. Because if you find out you have a better fit somewhere else they don’t get paid.
Buying the same plan that your spouse has without considering the different needs you may have
This is pretty common. Because for most of our lives we have the same insurance as our spouse. Before there may not have even been an option other than staying together so people assume they need to pick the same plan as their spouse. But Medicare coverage is based on one person. So each spouse can and should make their own decision.
This can be a touchy one issue to talk about. But you have to consider, was your spouse able to make an educated decision before?
I’m not saying this to insult your spouse or say they made a poor decision.
What I’ve seen is many people are overwhelmed by the amount of information out there on Medicare and make a decision to buy coverage just so they don’t have to read thru and try to compare so many options and they can just put this behind them.
Did your spouse do this before? Or did they attend some library seminar and decide that the company putting it on sounded like a good one? Without ever comparing what the options out there actually were?
Or consider for a moment the differences between you and your spouse.
- Do you take the same medications?
- Do you go to the same doctor?
- Do you have the same health issues?
- Do you have the same concerns?
If these are not all yes then I highly recommend you comparing your options. Because the plan your spouse picked may be the option you want to go with. But it may not be either once you actually see what your options truly are.
Not making an educated decision.
This really comes down to buying without knowing all of your options. And this is probably the one I see the most. Each of the earlier six mistakes could fall into this one as well.
There are more than 30 companies offering some kind of Medicare coverage in the state of Wisconsin. If you don’t compare them all then you are making a decision with limited information. Which means you are not making an educated decision.
I get it. To compare them all on your own is a lot of work. You may have to call 30 different insurance agents. Or go to 30 different company websites.
Do you even know 30 Medicare insurance companies? Most people don’t. It’s hard for most people to name 10 Medicare companies. Because they don’t advertise the way auto insurance companies do. So you don’t know who all to compare.
But I do. I have access to all of these companies. There is software that I pay a significant amount of money for each month that allows me to compare them. And I can share that with you. Full transparency. So you can make an educated decision.
Because I’m not trying to hide anything from you. I don’t have a hidden agenda.
My goal is that you will hire me as your insurance agent and let me help you through this process as well as allow me to be your contact in the future for any Medicare questions or issues.
My services are free for you because I am compensated by insurance carriers and you don’t pay any extra for that.
I hope you found this helpful.
You can reach me, Mike Lovell, at 608-571-4461 or emailing me at Mike@askMedicareMike.com