Senior health insurance is complicated
I have been in the insurance business for a number of years and I have been recently selling in the senior market which is folks over 65. I am retired now and my license will expire in about a month. I want to direct these comments primarily to RVers that are over 65 and in particular to full timers, since I am part of this group.
All senior insurance plans are closely regulated by the government. The agency that does this is usually known by its initials "CMS." The basic plan is simply medicare part A and B which you must have or you must sign up for when you approach 65. This is not optional, you must have signed up for medicare, both part A and B. You have already paid for part A through payroll deductions during your working life. Part B seems to be going up in price and will be about $94 a month, usually taken out of your Social Security check each month.
As we all know, simply part A and B is not enough coverage. One way to supplement your coverage is what is commonly called "Medgap coverage". These are standardized plans that do a good job of filling in the gaps left by Medicare part A and B and usually cost around $150 a month, more or less depending on the area. If this is what you have now, you are paying around $3000 a year ($250 plus that $94 times 12 months) for your health insurance. You probably have little or no copays or deductibles which doesn’t matter much since if you are healthy enough to drive that big rig around, you probably aren’t spending much time in a doctors office.
This particular system has not been working well for the government or the folks paying the premiums, who have been complaining to their elected representatives. As a result, the government put together a plan to turn medicare over to the private sector. They call this "Medicare Advantage". The government agency that regulates and approves everything associated with this plan is usually called CMS. For the Medicare Advantage plans, CMS pays the private insurance companies, which they approve, about $600 a month per person that signs up with them and provides guidelines, approves their policy and in general regulates everything. The insurance companies that get approved and provide these Medicare Advantage policys will provide everything that Medicare part A and B provide plus a whole lot more, so that you don’t need any other policy.
Now remember that the insurance companies are all competing with each other to get that $600 check from CMS when you sign up for their plan. All of these insurance companies have to be approved by CMS and they also have to be approved by each State that they choose to do business in. It costs the insurance companies money to get approved in each State and some are harder to get approved in then others. Because South Dakota has very few seniors to market to and a difficult State Insurance Department, the last time I looked, they didn’t have a single Medicare Advantage plan that was offered in the State. Here in Texas as in most other States, the premium for these plans will vary from county to county depending on what the insurance company expects for their costs and marketing success. Here in San Antonio (Bexar County) Texas, the premium for Secure Horizons is zero. In other counties, mostly low population density counties, the premium can climb up to $100 or even $150 per month for those plans that the insurance company agrees to sell there.
For full time RVers, there are other problems to watch out for. Most of the Medicare Advantage plans (not all) will have a network of doctors (HMO, PPO etc) which makes it difficult to use their plan away from your permanent residence, which most of us are away from most of the time. What is needed is a plan with no network called "Fee for Service". Also CMS (government) will check your permanent residence when you sign up for a policy. This means you can not camp in San Antonio with a drivers license that says South Dakota and sign up for a Medicare Advantage plan. You will have to move your permanent residence to an area that offers a good plan.
As a full time RVer, the plan that I like the best will be approved starting in 2007 for only a few States. Texas will be one of the States. Here in Bexar County (San Antonio), the premium will be zero, they will pay my part B for me, another $94 and I will only have to pay the part D or prescription benefit which will be about $10. The plan is a "fee for service" so it will be easy to use anywhere in the US. At this time I don’t know about Canada or Mexico. I plan on using the South Dakota mail drop, which I know is popular with a lot of full timers, but when I sell my house, my permanent residence will only move to my step sons home here in San Antonio.
The name of this insurance company is "Universal Health Insurance Co Inc.," and they are headquartered in Florida. I am sure there will be more companies like this one that will be competing for our business, so I would recommend that you stay on top of this. For our friends in South Dakota, $3000 a year for health insurance is pretty expensive and for me would not make up the difference in lower tax costs.
I would suggest that you look for an insurance agent in a major city that sells Senior Health Insurance, a city where you have or would be willing to have a permanent residence, and ask him to tell you about the Medicare Advantage plans that he carries that are "fee for service" and have little or no premium in an area where you can get a permanent residence.
