Overview of Medicare and some of the Costs

1. New Era Of Retirement

2. Understanding Boomer Statistics Rising Cost of Health Care Understanding Medicare

3. Boomer Statistics Born 1946 to 1964 Over age of 65 will DOUBLE in next 40 years $13 Trillion in Assets or 50% in overall assets * Multigenerational Families*

5. Rising Cost of Health Care The California Association of Health Plans By 2017, health care spending is expected to reach $4.3 trillion and 19.5 percent of GDP. Compare this to 1970, when spending was $75 billion capita and 7.2 percent of the GDP.

7. What are those Costs

8. Medicare What is Medicare? A Federal health insurance program that pays for hospital and medical care for elderly and certain disabled Americans. The program consists of two main parts for hospital and medical insurance (Part A and Part B) and two additional parts that provide flexibility and prescription drugs (Part C and Part D).

9. Part A- Hospital Insurance (FREE*) Covers Inpatient care in hospitals Inpatient care in a skilled nursing facility Hospice care services Inpatient care in a Religious Non medical Health Care Institution *There is a deductible of $1,100 (2010)*

10. Part B - Medical Insurance Helps cover medically-necessary services like doctors' services, outpatient care, home health services, and other medical services. May cover some preventive services Monthly premium $115.40 per month in 2011* There is a $162 annual deductible along with a 20% Co-pay

11. Medicare Part B Premiums Individuals who; Earn $85,000 or less – Premium = $115.40 Earn $85,001 - $107,000 – Premium = $161.50 Earn $107,001 -$160,000 – Premium = $230.70 Earn $160,001- $214,000 – Premium = $299.90 Earn above $214,000 – Premium = $369.10 Couples who Earn $170,000 or less - Premium = $115.40 Earn $170,001-$214,000 – Premium = $161.50 Earn $214,001-$320,000 – Premium = $230.70 Earn $320,001-$428,000 – Premium = $299.90 Earn above $428,000 – Premium = $369.10

12. What is NOT Covered by A & B Acupuncture. Deductibles, coinsurance, or copayments when you get health care services. Dental care and dentures (in most cases). Cosmetic surgery. Custodial care (help with bathing, dressing, using the bathroom and eating) at home or in a nursing home. Health care you get while traveling outside of the United States (except in limited cases).

13. NOT Covered cont. Hearing aids and hearing exams. Orthopedic shoes. Outpatient prescription drugs (with only a few exceptions). Routine foot care (with only a few exceptions). Routine eye care and most eyeglasses (exception for one pair of standard frames after cataract surgery with an intraocular lens). Routine or yearly physical exams. Certain screening tests Certain shots (vaccinations)

14. Part C – MediGap Plans MediGap Policy fills in the gaps that A, B & D do not cover. Coverage provided by private companies that are approved and governed by Medicare. Each Plan can charge different out of pocket costs Each plan may have different rules for how you get services (like whether you need a referral to see a specialist or in network). These rules can change each year.

17. Part D – Prescription Drugs Annual subscription, fee based on what types of medications are covered and which plan chosen. Private insurers approved by Medicare cover different types of medications, plan stays in effect for one year. If no plan is available that covers medications needed that cost has to be covered by paying out of pocket. If the plan happens to drop a covered medication after policy is in effect that policy is binding* The average (weighted) monthly premium was $35.09 in 2009, which is an increase from $29.89 in 2008*

18. The Problem Medical Expenses will affect almost everyone in retirement, for the majority they will be the largest expense they will have. Social Security in a majority of plans will not cover these costs.

19. The Solution Insert