Medicare buyers beware

If something seems too good to be true, it probably is. In this case, we're talking about the viral Facebook posts that promise free groceries for seniors just by signing up for Medicare. If you were skeptical about these claims, you were right to be. Read on to learn more about Flex Cards on Medicare and the best way to save money when choosing a plan.

What is a Flex Card?

A Flex Card is a prepaid debit card available to only a select few Medicare beneficiaries on a few Medicare Advantage plans. If you saw one of those posts mentioned above on Facebook, that might have been your first time learning about Flex Cards. That is because plans that offer Flex Cards are exceedingly rare, and you need to meet specific criteria to qualify. The promise of "Free Groceries for Seniors" is, unfortunately, an empty one.

In reality, these cards are usually linked to a flexible spending account (or FSA) with a small number of Medicare Advantage plans. Rather than the almost $3,000 that you may spend as you please that was promised on the image that went viral, most Flex Cards only offer, on average, $500 on approved medical supplies and treatments.

Who can get a Flex Card?

While it's partly true that Medicare beneficiaries are eligible to receive a Flex Card, the only plans that offer Flex Cards are Medicare Advantage plans. So if you've got a Medicare Supplement plan that you love (as so many of our clients do), then you are not eligible.

Only a small number of Medicare Advantage plans offer this as an added benefit. So, many people on Medicare Advantage plans they already love are also not eligible.

And research has shown that the only people who can get groceries approved on their Flex Cards are those with chronic illnesses. So even if you select one of the few Medicare Advantage plans with a Flex Card as a potential benefit, you might still not be eligible for free groceries.

Why are they being marketed so aggressively?

If the Flex Cards are so rare, why are they being marketed as if everyone could get free groceries on Medicare? Some marketing tactics used to get people to join Medicare Advantage plans have been dubious at best. Medicare Advantage plans are the fastest growing in all of Medicare, and a big reason for that is that many Medicare brokerages are motivated by the relatively higher commissions they receive for selling private Medicare Advantage plans.

The promise of free groceries can be enticing when deciding between many different Medicare plan options. Most of these plans with Flex Cards are HMO plans, which limit your ability to see healthcare professionals outside of your network. Oftentimes, you're being sold on a plan with worse overall coverage in favor of redundant perks.

At Fair Square Medicare, we are motivated by client satisfaction rather than commission. We would rather take the time to find the best plan for you than try to sell you on a gimmick that pays us a higher commission.

Medicare Advantage vs. Medicare Supplement plans

For some of our clients, a Medicare Advantage plan is the best option. Some of these examples might ring true for you:

• You can't afford the monthly premiums of Medicare Supplement plans.

• The savings you get from extra perks, such as dental, vision, or hearing benefits, might outweigh the savings you get from other medical expenses on Medicare Supplement plans.

• The limited network on Medicare Advantage does not impede you.

Medicare Advantage plans are not inherently bad, but they are frequently misunderstood. And generally, we recommend Medicare Supplement Plan G against all other plans. We've already done a deep dive into how exactly Plan G can save you money in the face of large medical bills. Let's do a quick recap below, using the example of two years of costs following a broken hip:

A broken hip on a Medicare Advantage plan

• Monthly Premium of $164.90 × 24 = $3,957.60

• A realistic scenario with an ambulance ($300), 5 day hospital stay ($300 per day for the first week), weekly physical therapy ($10 copayment), monthly specialist visits ($35 copayment), and monthly primary care visits ($10 copayment) will have them spending ($300 + $1500) + (104 × $10) + (24 × $25) + (24 × $10)

• Total = $1800 + $1,040 + $840 + $240 = $3,920 + $3,957.60 = $7,877.60

• A worst-case scenario will see them hit Max. Out-of-Pocket Cost of $5,500 per year × 2 = $11,000

• Total = $11,000 + $3,957.60 = $14,957.60

A broken hip on Medicare Supplement Plan G

• Monthly Premium ($164.90 + $115) × 24 = $6,717.60

• Annual Part B Deductible of $226 × 2 = $452

• Total: $7,169.60

This is just one example, but the takeaway is that Medicare Supplement Plan G saves you money on reasonable medical expenses and makes budgeting a no-brainer. Flex Cards can't offer savings like these.

Why you should exercise caution

You might be thinking, "I'm healthy now, so I can join Medicare Advantage when I turn 65. As I have more medical expenses in the future, then I will switch to Plan G." Not so fast.

Once you opt-in for a Medicare Advantage plan, you might have to go through medical underwriting. Underwriting means that a representative for your insurance company can go through your medical history in search of pre-existing conditions. If any pre-existing conditions are found, the insurance company might deny you coverage or offer you a much higher monthly premium.

Conclusion

Finding the right Medicare plan can be a challenging process. So the promise of free groceries can be enticing when presented as an option. Unfortunately, it's an empty promise. Rather than picking a plan that offers the flashiest perks, choose a plan that suits your needs. Or better yet, call an expert at Fair Square Medicare at 888-376-2028. We will show you the plan that fits you best.