I recently got a question from a woman who wondered why she should sign up for Medicare Part B, which covers doctor bills and other kinds of outpatient treatments, since she is in great shape and gets most of her care from a doctor who practices natural medicine. And I got another question from a man who said he didn't want to sign up for Medicare Part D, which covers drugs, because he doesn't spend much on medication. My opinion: Both people are courting disaster. Here's why.
Both readers made the common, all-too-human mistake of basing coverage decisions on the current state of their health, instead of considering what might happen if they develop a serious condition that's expensive to treat and/or medicate.
For example, one of the readers was a 66-year-old woman who said she was in great shape. She wrote, "I get a couple of blood tests and take a natural thyroid replacement, and my total out-of-pocket expenses for the year are around $3,000. I haven't taken Medicare Part B because it doesn't seem to cover any of these expenses. Is there a Part B that can accommodate my preference for natural medicine?"
While she may have admirable diet and exercise habits that reduce the risk of plenty of diseases, they have nothing to do with other ones that afflict people because of bad luck or bad genes. Parkinson's disease and many kinds of cancer come immediately to mind. Consider, for instance, what would happen if she developed breast cancer. It costs north of $100,000 to treat, mostly in the form of outpatient radiation and chemotherapy that's covered by Part B, not Part A. In that case, her total out-of-pocket expenses would zoom from $3,000 a year to $50,000 or $60,000.
The other reader says he and his wife do plan to buy a Medigap plan but not a Part D drug plan because it would cost "us over $1,000 per year, with an annual deductible of about $300 apiece, whereas our drug expenses don't add up to more than about $600 to $800 a year."
My thoughts: Your drugs may be cheap now, but what happens if in a couple of months one of you comes down with an ailment whose treatment involves $750 a month of prescriptions? Can your budget handle it?
And don't take comfort in the fact that you can always sign up for Part B and Part D later if your medical situation changes. This "right" comes with some expensive strings attached.
If you don't sign up for Part B when first eligible, you will be assessed a permanent 10 percent surcharge on your premium for every year you could have been on Part B, but were not. So already the woman, at 66, is looking at a 10 percent fine. Even worse, if you eventually do decide to go on Part B, you can only do it during the annual general enrollment period. The next one is Jan. 1 through March 31, 2013, with coverage to begin on July 1. So if you were to be diagnosed with breast cancer today, you'd have to foot the entire bill for your outpatient treatments for the next eight months.
Part D works a little differently. If you don't sign up when first eligible, you are assessed a permanent 1 percent premium surcharge for each month you could have been on Part D, but were not. For 2013, if you have delayed signing up for a full year, the penalty totals about $3.74 a month.
And as with Part B, if you delay signing up you can only join a plan once a year, during the open enrollment period that started Oct. 15 and runs through Dec. 7, with coverage to start on Jan. 1. So if you don't sign up and suddenly need an expensive new drug in February, you'll be paying for it out of pocket for 11 months before you can start Part D coverage.
p.s. In answer to the healthy woman's question, no, there is no special Part B for natural medicine enthusiasts. However, if your doctor accepts Medicare payments, Part B may cover some of your blood tests, depending on what they are and why you need them, and will definitely entitle you to a free annual "wellness visit." It also covers chiropractic treatment for certain indications. Part D does not cover over-the-counter nutritional supplements.