3 Ways to Help Clients This Open Enrollment

It’s Medicare’s open enrollment season, and that means your clients are hearing about the latest hikes in premiums and deductibles. Knowing what’s in the headlines can help you avoid being blindsided by client questions about health care costs. But it’s also an opportunity for you to be proactive about this important piece of your clients’ retirement planning.

When you know the latest, you can easily kickstart the conversation that many clients want to have with their advisors — but aren’t. Read the basics below and then follow the three easy steps to help them.

Medicare Part B Premiums to Rise

Medicare Part B covers physician services, outpatient hospital services, certain home health services and durable medical equipment.

• The standard monthly premium for Medicare Part B enrollees in 2019 will be $135.50, an increase of $1.50 from $134 in 2018.
•  For clients with a modified adjusted gross income (two years prior to enrollment) greater than $85,000 or $170,000 if married filing jointly, Medicare Part B premiums will be higher than the standard premium. Find 2019 premiums here.

Social Security Benefit to Rise

In 2019, the Social Security Administration’s cost-of-living adjustment (COLA) will be 2.8%. So, with the modest Medicare Part B premium increase of 1.1%, many Social Security recipients can expect to see more of that COLA increase in their checks. Yet there are still many others — those who benefitted from the hold harmless rule in the previous year — who won’t see as much of that 2.8% increase in their Social Security check because now they are catching up to the higher Part B premium.

Other Medicare Cost Increases

In addition to the Part B monthly premium increase, the Medicare Part A deductible and Part B deductible are increasing.

• The Medicare Part A inpatient hospital deductible that beneficiaries will pay when admitted to the hospital will increase $24, from $1,340 in 2018 to $1,364 in 2019.
• The Medicare Part B deductible will increase $2, from $183 in 2018 to $185 in 2019.

Part C (Medicare Advantage)

• Medicare Advantage (MA) premiums in 2019 will decrease from $29.81 to $28. The Centers for Medicare and Medicare Services (CMS) estimates that 46% of MA beneficiaries in their current plans will have a 0% premium.

The Bottom Line: Costs Are Outpacing Inflation

You don’t have to memorize these changes or even understand the complicated interactions of Social Security and Medicare to explain to clients the big picture: overall, annual health care costs are expected to inflate at a rate that will outpace general inflation. While the premium and deductible increases announced recently by CMS may seem minimal, they add up over time and are only a few of the increases your clients will experience across health care.

Simply asking clients if they’re reviewed their Medicare coverage this open enrollment can open the door to a referral to Medicare BackOffice^®. We’ll take it from there.

Follow These 3 Steps to Help Clients This Open Enrollment:

1. Urge them to review their Medicare Advantage and Medicare Part D Prescription Drug coverage during open enrollment Oct. 15 through Dec. 7.
2. Explain that an annual review is an important step in managing health care costs and mitigating risks to their retirement plan. It can identify changes that could be costly as well as other plans that could save them money.
3. Give them the Medicare BackOffice phone number — 1.877.385.8083 — and remind them to tell the Licensed Insurance Agent your name, so that you get your referral fee (if you can accept them). Or, fill out this form with your client’s approval if you’d like us to contact them. 

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