If you're planning for retirement, it's important to explore options for health and routine care.
Find out what community programs are available in your area such as homemaker or "chore" services, "meals on wheels" and adult day care centers. Find out the cost of these programs to determine how far your savings and/or insurance will go toward meeting the costs. And find out what your insurance policy will and will not cover.
Begin by asking what happens to your current health insurance policy when you retire. It may be terminated at your retirement, or you may be able to covert it to a private policy. A third alternative is that the insurance may continue with reduced benefits as a supplement to Medicare.
Almost all workers are fully covered by Social Security and eligible to participate in both part A and part B of Medicare.
Part A is hospital insurance, which is part of the pre-paid benefits. Part B helps pay for doctor bills. You purchase part B with premiums withheld from your Social Security check.
Six months before your 65th birthday, you should visit your local Social Security office and sign up for benefits. Since Social Security is subsidized by the government, it is a good insurance buy for the money spent.
How much, if any, supplemental health insurance you need for acute (short term) and chronic (long term) care, will depend on your current financial situation.
If your income is low, you may qualify for Medicaid, which supplements Medicare, and you may not need additional health insurance coverage.
Four types of individual policies help fill the gaps not paid by Medicare. These include major medical, hospital insurance policies, Medicare supplemental policies (sometimes referred to as wrap-around policies), and long-term care insurance.
The law requires insurance agents selling Medicare supplement policies to provide the prospective buyer with a "Buyer's Guide." This guide is designed to help the consumer determine what gaps exist in his health insurance program and gives the seller an opportunity to show how his insurance fills the gaps left by Medicare.
All accident and hospitalization insurance policies sold in Florida must have a free inspection provision which allows the buyer 10 days to examine a policy. If for any reason the buyer decides that he does not want the policy, he can cancel it by returning it to the agent, and obtain a full premium refund.
When shopping for insurance, some tips to remember are:
- Know the company you are dealing with. The company and the agent should be licensed to sell insurance in Florida.
- Don't drop one policy and buy another one with similar benefits. There could be a delay in receiving benefits and pre-existing conditions could be excluded.
- Purchase policies that can be renewed.
- Be aware of offers that suggest the insurance is government-sponsored. Medicare supplement insurance is not sold by the state or federal government.
- Don't over insure. There are better things to do with your money than pay premiums that duplicate or overlap insurance coverage you already have.
- Pay premiums with a check or money order, so that you will have a record of the transaction.
Check with the Florida Department of Financial Services (1-800-342-2762) if you have questions about the policy you are considering, the agent, or the company he or she represents. The department cannot make a purchase decision for you but can tell you if the company is reputable and if the policy meets state standards.
Prepared by: Dr. Josephine Turner
Professor, Family, Youth and Consumer Economics
University of Florida
