
Seniors on Medicare just don’t want to switch their Medicare plan for their own benefit. Many reasons are suggested why they are willing to leave money and benefits on the table. Studies show that only 8% of seniors actually switch their plans, suggesting that they are not confident with their level of understanding Medicare. Medicare Plan Advisory has solutions that are free and can yield savings and additional benefits.
The number of Americans aged 65 to 95 and older is projected to nearly double from 52 million in 2018 to 95 million by 2060, or 23% of the total population. 1 The number of people 85+ projected to more than triple from 6 million today to 20 million by 2060. In the U.S., around 10,000 baby boomers are turning 65 today and every day for the next 15 years.

In Connecticut, growth of seniors is projected to rise 38% over the next 15 years, and those over 85 are projected to increase 29% from 102,288 to 132,440.
The current growth of the population ages 65+ is one of the most significant demographic trends in the history of the US. Baby boomers have brought both challenges and opportunity to the economy,infrastructure and institutions as they have passed through each stage of life. Turning 65 brings complicated decisions that affect their future standards of living as seniors begin retirement.
Not only are they faced with the complexity of financial planning in determining their changing living expenses and sources of income, but they must also focus on healthcare planning, a major cost component of retirement. A Fidelity Investment 2019 study revealed that male seniors aged 65 should plan for 20 years in retirement; women for 22 years. They suggest saving 15% of pre-tax earnings to prepare for retirement. A couple, retiring in 2019, at 65 years old can expect to have healthcare expenses of around $285,000, depending on health status, area of living and longevity.3 An annual expense in retirement of $14,000 or more deserves attention in any financial planning effort.
Financial preparation for retirement can take many forms and begins years before actual

retirement. Planning complexity for those with lower net worth is in general simpler than for those with higher incomes, and assets. Planning methods range from a simple cost of living accounting comparison, to a full-fledged financial plan completed by a Certified Financial Planner. In all cases, the big concern is running out of money in retirement. A close second is healthcare to cover their needs.
Planning for 20+ years of healthcare expenses requires careful analysis with a time horizon that declines every year, as healthcare expenses usually increase. Don’t let rising healthcare expenses contribute to running out of money in retirement. Decision
making for healthcare over the same timeframe continues to be a problem for seniors. The cost of healthcare during the retirement period can be significant but can, to a large degree, be managed on an annual basis.
Although your health condition will likely change, you cannot accurately predict the possible medical events requiring healthcare for the next year. However, you can review your current healthcare plan compared to the new proposed plans for next year to find the optimal solution.
Controlling the cost of your healthcare for the following year can have a significant impact on the total cost of healthcare during retirement. It is a year-by-year decision you should make as your needs change. Medicare plan costs will most likely also change- Premiums, medical benefits, drug coverages, copays, deductibles, doctors, hospitals, added or deleted optional benefits are all subject to change. If you have the average annual healthcare expense in retirement of an estimated $14,000 or more, one should spend some time in reviewing proposed plans to cover that expense the next year.

The Centers for Medicaid & Medicare Services (CMS) encourages seniors to shop for Medicare Advantage and prescription drug plans to potentially save money on prescriptions or get new benefits. Given that some presidential candidates and policymakers are discussing proposals to improve on Medicare or broaden the role of private healthcare plans, understanding the barriers that people on Medicare experience will continue to be important.
Each year, seniors in Medicare Advantage and Part D stand-alone prescription drug plans can change plans during the annual open enrollment period (October 15 to December 7). Medicare Advantage plan medical and drug benefits vary significantly
and can change from one year to the next. Not only do benefits and costs change in this competitive market, but value- added services are added to provide needed services and make plans more competitive.
The market for Medicare Advantage plans is becoming more and more competitive from a cost and added benefit standpoint for a multitude of reasons:
1. Number of plans available: the average Medicare beneficiary has access to 28 Medicare Advantage plans in 2020 from 18 in 2014.
2. Number of Firms: the average Medicare beneficiary can choose from plans offered by seven firms.
3. Market Entrants and Exits: Thirteen insurers entered the market for the first time and one exited in 2020.
Extra Benefits: Nearly all beneficiaries (97%) have access to Medicare Advantage plans that provides dental, fitness, vision and hearing benefits which are not covered by traditional Medicare. Some other new benefits include include transportation, meals, in-home support, caregiver support,
Seniors can assess these changes and if deemed necessary, switch plans during the annual open enrollment period. A study was performed by Kaiser Family Foundation, published Dec 02, 2019 that
studied Medicare beneficiaries enrolled in Medicare Advantage plans and stand-alone prescription drug plans who during the annual open enrollment period between 2007- 2016 switched plans for the following year.

Studies showed that few beneficiaries revisit their coverage decisions each year to determine which option is best for them. Only 8% switched to another plan during the 2016 enrollment period for the 2017 plan year. In the KFF survey, in 2017, 35% of Medicare beneficiaries living in the community said it is very or somewhat difficult to compare Medicare options; 44% for beneficiaries in fair or poor self-reported health;
40% for beneficiaries with five or more chronic conditions. 45% of Medicare beneficiaries in the community said they rarely or never review or compare their Medicare options; the share was substantially higher among beneficiaries ages 85 and older at (57%).
To determine why seniors, stay in the same plan, rather than review and switch plans, KFF partnered with PeryUndem to conduct a series of focus groups with seniors about their healthcare plan decision making.
Reasons for low switching rates among Medicare beneficiaries could be:
1. Challenging Plans: Beneficiaries find the process of comparing the multitude of plans too challenging,
2. Unawareness: Beneficiaries are unaware of the option to switch during annual open enrollment period,
3. Limited Confidence: Beneficiaries have limited confidence in their level of knowledge to accurately choose a better plan,
4. Complacency: Beneficiaries were satisfied with the results of the plan they had without looking into better plans,
Uneducated: Beneficiaries do not know about differences between plans that could have a
Considering the reasons for people to review for possible plan change, it is best to compare all the factors simultaneously in order to maximize value and lower costs. It is, however, time consuming and challenging, especially for those with cognitive impairments or serious health needs. This tendency to stay with the same plan raises a question as to whether the “stickiness” leads to avoidable costs, or unrealized benefits for a large share of the Medicare beneficiaries.
Only a professional is qualified to review and analyze the factors to be considered in the

simultaneous “switch decision.” The experienced professional must be fully educated on the Medicare regulations, appointed and certified by Medicare approved insurance companies. With the encouragement of the Centers for Medicaid & Medicare Services (CMS) and the myriad plans and benefits in an increasingly competitive marketplace, seniors should review their plans every year to ensure having the optimal plan in place.
Medicare Plan Advisory is a private, local company that educates, recommends and enrolls seniors in Medicare Advantage, Prescription Drug and Supplemental plans. So, if seniors are not confident in researching available Medicare plans themselves, Medicare Plan Advisory can do it for them. After a discussion of how the Medicare program and options work, the client profile data are collected to determine the “best plan” for them. The company then reviews all of the plans available and selects two that best fit the client profile. A line by line review of the two plans is conducted with the client and a plan is recommended.

The client confirms the selection and is enrolled in that
plan, either as a first-time plan or a replacement plan for the following year.
These services are free to the senior, as the insurance companies compensate MPA upon enrollment in a plan. In addition, they provide a variety of ancillary insurance products. Among those products are insurance plans providing coverage for: dental, vision, hearing, hospital indemnity, critical illness, final expense and others. For additional information,
contact them at 203-856-7391 or cyost@medicareplanadvisory.com. More information is available at www.medicareplanadvisory.com.
References
1. “Fact Sheet: Aging in the United States,” Population Reference Bureau, July 15, 2019.
2. “Key Senior Statistics: Connecticut Senior Guide, www.seniorcare.com.
3. “How to plan for rising healthcare costs,” Fidelity Benefits Consulting estimate, 2019, www.fidelity.com.
4. “No Itch to Switch: Few Medicare Beneficiaries Switch Plans During the Open Enrollment Period,” Kaiser Family
Foundation, Dec 02, 2019.
5. “Medicare Advantage 2020 Spotlight: First Look,” Kaiser Family Foundation, Oct 2019.
6. Op.cit. Kaiser Family Foundation, Oct 2019.
7. Ibid, Kaiser Family Foundation, Dec 02, 2019.
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