Did You Know: CMS defined Standard Benefit Plan changes

Here are the highlights for the CMS defined Standard Benefit Plan changes from this year to next. This “Standard Benefit Plan” is the minimum allowable plan to be offered.

• Initial Deductible: will be decreased by $15 to $310 in 2014
• Initial Coverage Limit: will decrease from $2,970 in 2013 to $2,850 in 2014
• Out-of-Pocket Threshold: will decrease from $4,750 to $4,550 in 2014
• Coverage Gap: begins once you reach your Medicare Part D plan’s initial coverage limit ($2,850 in 2014) and ends when you spend a total of $4,550 in 2014.
In 2014, Part D enrollees will continue to receive a 52.5% discount on the total cost of their brand-name drugs while in the coverage gap.  The 50% discount paid by the brand-name drug manufacturer will still apply to getting out of the donut hole; however the additional 2.5% paid by your Medicare Part D plan will not count toward your TrOOP. Enrollees will pay a maximum of 72% co-pay on generic drugs while in the coverage gap.
• Minimum Cost-sharing in the Catastrophic Coverage Portion of the Benefit**: will increase to greater of 5% or $2.55 for generic or preferred drug that is a multi-source drug and the greater of 5% or $6.35 for all other drugs in 2014
• Maximum Co-payments below the Out-of-Pocket Threshold for certain Low Income Full Subsidy Eligible Enrollees:  will increase to $2.55 for generic or preferred drug that is a    multi-source drug and $6.35 for all other drugs in 2014

Pay No Attention to the Man Behind the Curtain | What This Means to Insurance Agents

From the book by L. Frank Baum, The Wonderful Wizard of Oz, comes one of my favorite quotes “Pay no attention to the man behind the curtain!”

In our age of sound bites, self-appointed pundits and mega-hype, we need to take heed to this sage advice. Let’s take the future of Medicare for example:

Medicare will go bankrupt in seven years unless drastic changes are made. So we were warned – in 1969.

Experts pegged the countdown to disaster at eight years in 1981 and four years in 1997. In fact, every report by the program’s Trustees, since the first one was issued in 1970, has projected pending bankruptcy. Some of those reports saw it coming in as little as two years.

Last week, the Trustees reported that insolvency is now due in 2024, five years earlier than they predicted a year ago.*

So, with every warning in the last 43 years the government has adjusted and maintained the solvency of the program, because to not do so would create havoc in the electoral body of representatives and cost them their jobs.

What does that mean to us in the insurance industry today? Well:

• Original Medicare Part A and Part B has remained fundamentally the same since 1965 with an actual increase in benefits due to medical technology while adjusting the program costs to keep up with medical costs and inflation.
• One change is that we have more creative ways to help more people supplement Medicare today than any time since 1965.
• The increasing number of Medicare enrollees will drive more than $3,000,000,000 of annualized new business premium in the Medicare Supplement market in 2012, and that number is projected to increase 50% in the next 3 years.
• Nine out of ten Medigap policyholders are satisfied with their coverage. **
• More than nine out of ten (91 percent) would recommend Medigap coverage to a friend or relative when they turn 65 and enroll in Medicare. **

Our opportunity in the Senior Market is unprecedented!!! Our next few posts will be highlighting this opportunity and how we at Senior Market Specialists, and you, can capitalize on this. Until then; “Pay no attention to the man behind the curtain!”

**http://www.philly.com/philly/blogs/healthcare/Is-Medicare-Going-Bankrupt-Not-Really.html#ixzz1yXgszBER

**AMERICANVIEWPOINT AHIP National Medigap Satisfaction Survey