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Medicare and Individual Insurance: What You Need to Know Now

oswaldcompanies February 17, 2021

During these unprecedented times, the challenge of managing the ever-increasing cost of health insurance has become more difficult as additional factors contribute to the number and frequency of claim occurrence due to an:

  • Aging workforce population
  • Increase in events that trigger COBRA eligibility

Employers may not be able to eliminate or control the occurrence of claims. However, employers can implement risk management strategies that help to “transition” or avoid potential claims that drive health insurance premium costs. This strategy requires employee access to information, education, and personal assistance regarding affordable options to employer-based coverage.

Take a fresh look below for personal health insurance options (Short-Term, Affordable Care Act (ACA) or Marketplace and Medicare Plans) that can eliminate claims occurrence from:

  • New hires
  • COBRA annuitants
  • Employees working beyond age 65

New Hires

Approximately 75 percent of employers require new hires to complete a waiting period of up to 90 days before health insurance coverage begins. For good reasons, laws are in-place to protect individuals from discriminatory hiring practices based on health or pre-existing conditions. At the same time, a growing number of individuals seek employment for access to employer-based health insurance. To “balance” the needs of the new hire and that of the company, Marketplace and Short-Term plans can be used to “bridge” the new hire waiting period gap in coverage.

COBRA Annuitants

Employers can also inform employees of personal health insurance options to the continuation of coverage under the COBRA law. The Medicare Rights Center reports that individuals and families choosing to pay the monthly premium to maintain extended access to and use of the employer-based plan under COBRA tend to:

  • Be older, 50 years old, than the age of the full-time covered employee, 42 years old.
  • Use health care more frequently. COBRA claimants had almost five times more hospital days and filled twice as many prescriptions than those covered at work.
  • Have more chronic conditions. People using their rights under the COBRA law are more likely than those working with employer-base coverage to have chronic conditions like COPD, diabetes, cancer, high blood pressure, high cholesterol, mental health disorders, and musculoskeletal disorders.
  • Spend more on health care. In 2018, full-time workers with individual employer-based coverage used an average of $6,724 in health care services, while those on COBRA used an average of $18,752.

Employees Working Beyond Age 65

For a variety of reasons, more people are choosing to work beyond age 65, maintaining health insurance through their or spouse’s employer as employee payroll contributions, plan deductibles and out of pocket costs continue to increase.

By 2024, the U.S. Bureau of Labor Statistics project that the labor force will grow to about 164 million of which 25 percent will be ages 55 and older. Employees 65 and older are projected to have a faster rate of annual labor market growth of any other age group…55 percent ages 65 to 74 and 86 percent ages 75 and older. The Kaiser Family Foundation reports that individuals 65 and older are responsible for almost 40 percent of total health spending by age group.

A misunderstood and underused option for the growing number of employees age 65 and older is to exercise their right to choose Medicare as their primary health insurance in lieu of employer based coverage. Medicare plans like Medicare Advantage can provide an attractive, personal option, lowering the employee monthly cost of being enrolled in a group health insurance plan as well as reducing an employee’s out-of-pocket cost. Plans are designed to provide greater levels of coverage and access to benefits like prescription drug, dental, vision, hearing aids, meal, and transportation services at no additional cost.

Oswald Companies and UROne Benefits™ provides unmatched access and advisory on the full range of individual health insurance options.

To discuss and implement these important risk management strategies, please contact your Oswald Client Service Team or call UROne Benefits™ at 330-845-4771.