IBM Extend Health - Why I like Medigap F high deductible plans

If you decide to stay with original Medicare part A & B and want secondary aka supplemental aka medigap insurance to cover your copayments and deductibles - I urge you to look at medigap F plans as a great category and in particular the version of the F plan that has a high deductible -  also referred to as F+ plans.  The + doesn't mean more coverage it means there is a deductible.

F plans provide the maximum coverage offered by a medigap. See the comparison chart at the end of this post for all the types of medigap plans that are available.  A reminder - no matter who is selling a medigap plan - the elements are always the same.  So, buy the cheapest medigap plan in the letter category you are considering.  There is no advantage to buying a higher premium policy.

OK - so I like F plans because they cover everything.  Why the deductible version?  After all, the deductible portion of the F+ plan is currently $2110.  This deductible is set by Medicare and not by the insurance companies.  It goes up a bit every year but nothing drastic.  Last year it went up by $10. Even so, $2110 seems like a lot of money but when you do the math it really isn't.

At first, I did a bunch of calculations to decide whether or not to use a high deductible F plan. I looked at my coinsurance payments in 2012 and in 2013 and a lot of "what ifs" as to when would F be better than F+.

In my opinion that is not at all necessary. Here is my current analysis;
   

• Take the F+ deductible and divide it by 12.  In 2013 (2110/12) is  175.83.  For the sake of simplicity I'll use 176.
     
• Add $176 to the F+ policy monthly premium.  In New York the monthly premium is about $80/month so the effective F+ premium is $256/month.
    
• Compare the adjusted F+ premium (e.g., $256/month) to the montly premium for an F plan with no deductible.  In New York it is about $323/month.
   
• If the adjusted F+ premium is lower than the F premium then the F plan without a deductible is more expensive - always buy the F+ plan.  So, in my NY example, no matter my health - I will pay less in deductible and premiums to have an F+ plan ($256 vs. $323) than to have an F plan.
    
• If the adjusted F+ premium is the same as or higher than the F premium then buy the F plan if you are not healthy.
    
• If the adjusted F+ premium is the same as the the F premium and you are healthy buy the F+ plan because you might get lucky and not pay out the whole deductible.
     
• If the adjusted F+ plan is higher than the F premium and you are healthy then decide if you want to gamble you will stay healthy. If you get sick - especially early in the year -  it may end up costing you more to be on an F+ plan. 

I hope this logic helps you decide what plan to pick.  Reminder - the deductible and copayments are covered by your HRA - if you have one.

 I pulled the following chart off the www.medicare.gov website:

Medigap Benefits	Medigap Plans
	A	B	C	D	F*	G	K	L	M	N
Part A coinsurance and hospital costs up to an additional 365 days after Medicare benefits are used up	Yes	Yes	Yes	Yes	Yes	Yes	Yes	Yes	Yes	Yes
Part B coinsurance or copayment	Yes	Yes	Yes	Yes	Yes	Yes	50%	75%	Yes	Yes***
Blood (first 3 pints)	Yes	Yes	Yes	Yes	Yes	Yes	50%	75%	Yes	Yes
Part A hospice care coinsurance or copayment	Yes	Yes	Yes	Yes	Yes	Yes	50%	75%	Yes	Yes
Skilled nursing facility care coinsurance	No	No	Yes	Yes	Yes	Yes	50%	75%	Yes	Yes
Part A deductible	No	Yes	Yes	Yes	Yes	Yes	50%	75%	50%	Yes
Part B deductible	No	No	Yes	No	Yes	No	No	No	No	No
Part B excess charges	No	No	No	No	Yes	Yes	No	No	No	No
Foreign travel exchange (up to plan limits)	No	No	Yes	Yes	Yes	Yes	No	No	Yes	Yes
Out-of-pocket limit**	N/A	N/A	N/A	N/A	N/A	N/A	$4,800	$2,400	N/A	N/A

* Plan F also offers a high-deductible plan. If you choose this option, this means you must pay for Medicare-covered costs up to the deductible amount of $2,110 (in 2013) before your Medigap plan pays anything.
** After you meet your out-of-pocket yearly limit and your yearly Part B deductible, the Medigap plan pays 100% of covered services for the rest of the calendar year.
*** Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to a $50 copayment for emergency room visits that don't result in inpatient admission.

If you live in Massachusetts, Wisconsin or Minnesota check medigap offerings are different.  Check with the state SHIP (www.shiptalk.org will give you the phone number) to find out what they offer.

IBM Extend Health Medicare change has nothing to do with Obamacare

Corporations started this transistion to outsource health benefit management in 2004 so this change to push us to Extend Health has nothing at all to do with Obamacare.  Some corporations are implying it does and accelerating the change by taking advantage of the fact that the Affordable Care Act (aka Obamacare) is in the process of being implemented. There is no connection to ACA and it is rather dishonest to imply there is.  I don't think IBM has implied it.  The truth is corporations just figured out another way to weasel out of promises made to retirees and employees so that they can improve their bottom line and or give out bigger executive bonuses.
 
Corporations WANT to get out of the business of offering employee benefits.  They started offering generous benefits after World War II to attract new hires because there were government rules prohibiting them from using wages to keep inflation in check. They needed something else to entice prospects because competition for workers was fierce.  Those days are long gone.  Corporations aren't competing for USA employees in most industries.  Even in high tech industries the number of US employees is dismally low because companies can and do source talent from all over the world.  The Ikea model of sourcing furniture from all over the world now applies to people.

There also continues to be a huge amount of misinformation about the ACA impact on Medicare.  As I previously wrote - listening to talking heads about this stuff will make you sick!  There is an article in US News & World Report that tries to help.  I got this from a bulletin that is sent out from the Medicare Rights Center. Here is what they say:

The Facts about the Affordable Care Act and Medicare

This week, US News & World Report published an article on the myths and facts of how the Affordable Care Act (ACA) affects Medicare beneficiaries. According to the article, older adults are often confused about how Medicare works and ACA changes are compounding some of that confusion. The article summarizes five myths about the ACA and Medicare and provides the facts on how the ACA impacts Medicare beneficiaries, both now and going forward.
  
“Medicare is ending.”
  
False. The ACA is not replacing Medicare, and Medicare has grown stronger as a result of the ACA. In fact, the ACA adds eight years to the solvency of Medicare’s Part A Trust Fund, increasing the years of the program’s guaranteed benefits to 2026, 10 years longer than before the ACA.
  
“Seniors on Medicare must buy more health insurance to comply with the ACA.”
 
False. Seniors and people with disabilities will not be required to purchase more health insurance coverage to comply with the ACA. Further, Medicare beneficiaries will not need to purchase health insurance in the new marketplaces.
  
“Medicare beneficiaries will pay more for their medications under [the ACA].”
  
False. While the Part D premium will increase slightly for Medicare beneficiaries with higher incomes (individuals with annual incomes over $85,000 or couples with annual incomes over $170,000), the majority of Medicare beneficiaries have already started paying less for their prescriptions. Over time, the ACA closes the prescription drug coverage gap, or doughnut hole, and according to a recent CMS press release, more than 6 million seniors had saved over $7 billion on prescription drugs at the end of June 2013.
 
“Medicare beneficiaries won’t be able to see their current doctors.”
 
False. Nothing in the ACA expressly changes the doctors that Medicare beneficiaries can see.
 
“Medicare premiums are rising.”
 
False. The ACA has not attributed to the rise in Medicare premiums. In fact, Medicare costs are rising more slowly as a result of provisions in the ACA. Also, according to the most recent Medicare Trustees’ Report, the Medicare Part B premium will remain relatively unchanged between 2013 and 2014, and Medicare Advantage plan premiums as well as Part D premiums are also stable year-to-year generally.

Here is the link to  U.S. News & World Report  http://health.usnews.com/health-news/health-insurance/articles/2013/08/19/will-obamacare-affect-medicare-myths-and-facts

IBM Extend Health versus Medicare enrollment periods

Extend Health told us that our enrollment period to participate in IBM HRA or IBM FHA subsidies in 2014 is from October 1, 2013 - December 31, 2013. If you enroll by the last day of December 2013 you will be covered by your new insurance starting January 1, 2014. If you do not enroll by the end of 2013 you still will be able to enroll for two more months but depending on the state you live in and the plans you pick different enrollment rules might apply. AND you will not have health insurance until the first day of the month after you enroll.  So it is not wise to do it.  This is happening because there are two things going on for us this year.  It has to do with Medicare enrollment periods. Medicare law defines several types of enrollment periods.

• Medicare open enrollment for 2014 is from October 15 - December 7, 2013.  During open enrollment (which happens every year) all Medicare eligible recipients are able to change their health insurance plans to be Original Medicare or  a new Medicare Advantage and/or a new Prescription Drug (part D) plan for the next year.
     
• Medigap plans ARE NOT part of the Medicare open enrollment window.  Medigap enrollment rules vary widely from state to state.  For example, New York allows you to change or get a Medigap plan whenever you want and insurance companies cannot deny you but you might have a 6 month wait to cover pre-existing condition clause.  California allows you to change once a year on your birthday.  Some states only require insurance companies to sell you a medigap when you first turn 65.  All states have a guarantee issue requirement that insurance companies must sell you a medigap plan (albeit with the 6 month pre-existing wait) when your prior plan is ending.  This is our case - our corporate plan is ending.  In Medicare parlance - it is called a special enrollment period or an SEP.
     
• Medicare Special Enrollment Period is provided to us because our IBM corporate plan is ending.  SEPs are provided for A LOT of reasons - not just when an existing plan ends. Because our IBM insurance is ending we have an SEP that starts on December 8 and goes until the last day of February 2014.  To find out all 17 SEPs available and all the rules go to: http://www.medicareinteractive.org/uploadedDocuments/mi_extra/SEP-Chart.pdf.  Our SEP is defined as reason # 12 and is a ONE TIME SEP. So, if you enroll after December 7, 2013 you will not be allowed to change your choices after you do it. I am not clear how Extend Health will deal with all the SEPs and will be asking more questions about it the next time I talk to an agent.
     
• Medicare Advantage Disenrollment Period is from January 1, 2014 - February 14, 2014.  If you are dissatisfied with the Medicare Advantage plan you choose you can disenroll and go back to original Medicare and get a part D drug insurance plan.  HOWEVER, you might not be able to buy a medigap plan.  It depends on the rules in your state whether an insurance company is required to sell you a plan and the SEP will no longer apply since prior plan SEP is a one time thing that you used up in 2013. Again, I don't know how Extend Health works with the MADP but it is an important question to ask.

IBM Extend Health for Medicare products Is NOT a true Health Exchange

I don't know why IBM is referring to the transition for medicare eligible retirees as a transition to a private health insurance exchange.  At best it is confusing and at worst it is misleading.  I believe Extend Health does offer "exchanges" to companies for employees but what they are doing for us is much less than what happens in a private exchange.

The words "health insurance exchange" are so overused.  The federal government is even moving away from "exchange" wording and talks about the Health Insurance Marketplace when describing the Affordable Care Act "health insurance exchange" although what is happening with the ACA is really an exchange.  The mechanics of ACA will be set up to help people under 65 who are uninsured find the best, cheapest group insurance plan available to meet their needs and also to help them find out if they qualify for government assistance in paying for that health insurance plan. States will be negotiating with insurance companies (if they setup a state run pool) for the group plan products offered in the exchange.  Individuals cannot buy ACA offered plans directly from insurance companies because ACA plans are not individual plans. Buyers have to contact ACA  support staff to register and ACA representatives will be be helping them pick the best fit products without any financial incentives going to the ACA function or the ACA representatives.

The Extend Health services we are getting are not anything like that.  Extend Health has deals with a number of insurance companies to be able to sell EXACTLY THE SAME standard Medicare insurance policies that are available and for sale to any Medicare eligible individual in the "open marketplace" and at the same price. There is no group discount. There is no specially structured insurance product for medical and prescription drug insurance (ala what we had with IBM in 2013).  EH will also have deals with insurance companies to provide dental and maybe vision insurance because Medicare does not cover routine eye exams and eye glasses - maybe EH will negotiate a group discount for those products. The agent I talked to implied there will not be any vision policies but maybe he was wrong.  I keep saying this --- THINK OF THE SERVICES WE GET FROM EXTEND HEALTH AS USING AN INSURANCE AGENT. 

Extend Health won't be  offering you the cheapest, best policy in the marketplace for your zip code.  They will offer you the best fit for the products they sell.  They won't try to figure out if you would qualify for government assistance to pay for your premiums (yes, there are low income assistance programs for people on Medicare) but it's unlikely IBM retirees would qualify. The ONLY reason to use IBM's Extend Health setup to buy an insurance policy is it will trigger you to be able to get your IBM HRA or IBM FHA subsidy.  It is my plan to buy one insurance policy from EH to get access to my subsidy and the rest of my insurance policies from EH only if they are cheapest, best policies I can buy in the open marketplace.

There is also something I found describing the legal mechanics of an HRA account that you may find interesting. It indicates there is NO LEGAL reason that IBM is not allowing us to roll over HRA balances from year to year and no legal reason to use Extend Health.  Also, IBM could have just given us access to HRA accounts without having Extend Health as a middle man and allowed us to spend the money as we pleased on medical services - even forgo buying insurance policies. I continue to believe IBM is using Extend Health because IBM believes we will not use up all of the subsidy money in our accounts and that will translate to millions of dollars of reduced expense to IBM. This excerpt came out of a much longer position paper from a non-profit organization.  I didn't provide the link because it was a politically biased position paper. I believe the excerpt is not:

In 2002 the Internal Revenue Service issued a Notice (2002-45) and Revenue Ruling (2002-41) creating what it termed a “Health Reimbursement Arrangement” (HRA).7 These rulings were a new way of interpreting Sections 105 and 106 of the Internal Revenue Code, which authorize employer spending on health services.

Essentially, employers may take such spending as a business deduction without adding the funds to the employee’s income. Such money may be deducted only when it is actually spent, not when it is promised. The IRS said employers may allocate an amount of money for employees to spend in the future, but this allocation is only “notional” (there is no actual money in an account) and the employer may deduct it only when it is in fact spent on a health care service.

HRAs allow employers to contribute to an employee’s health care expenses (including premiums) without restriction by creating a Health Reimbursement Account, which is tax-free but may be used solely for health care expenses. Unspent funds may roll over and build-up over time, but always remain the property of the employer until used.

There is no restriction on the amount of money, and there is no requirement that there be any kind of insurance policy to accompany the account. Thus, HRAs may be for any amount of money and they may go along with any kind of insurance programs – or none at all. An employer may simply make an HRA available instead of providing insurance.

IBM Medicare Extend Health - More reasons to wait until after October 14, 2013 to enroll

Medicare open enrollment begins on October 15,2013 and runs through December 7, 2013.  October 15, 2013 you will be able to see all the plans available in your zip code for Medicare Advantage, medigap and part D prescription drug insurance on www.medicare.gov.  These plans will have 2014 prices.  Medicare will also publish the part B premium for 2014.  All of this is important information for you to have so that you can make the best choices based on your subsidy.

Medicare.gov is the only authoritative source for those prices.  Don't rely on any other site for insurance company premium prices. I have seen several chat room postings that include premium prices.  I doubt they are 2014 prices since insurance companies don't have to release those prices until Medicare open enrollment. There is also a lot of misinformation floating around about medigap plans so I wrote a lot more about medigaps in this post. 

The rules for medigap plans are different from state to state so you must find out the rules for your state.  Call your state health insurance assistance agency to find out the rules and the prices (go to www.shiptalk.org to get the phone number).  Specific company medigap policy prices are not on www.medicare.gov - the site only gives you a price range.  Also, on medicare.gov to find medigap information you have to go to the top of the site's homepage.  Medigaps are not included in the "planfinder" link in the middle of the site's homepage because you cannot directly enroll in medigaps off of medicare.gov. You must contact the insurance company to enroll.  It has also been my experience in helping people that insurance companies do not like to sell low premium medigap plans and make it difficult to buy one.  They will try to upsell you.  In that regard, Extend Health will be great as they do the enrollment for you if you buy through them.

As I said, the rules for medigap widely range from state to state. New York is fabulous when it comes to medigap plans.  First, there is no "enrollment period".  You can enroll in a medigap plan any time you want and you can change from one type of plan to another whenever you want.  How this will work with Extend Health enrollment is not clear.  I did ask EH but the agent didn't even know NY had continuous enrollment. You do not have to previously had a medigap plan to get a medigap plan so there is no "guaranteed issue" problem. NY has what is  called continuous enrollment.  As I said, there is no requirement to have had a prior medigap plan - however if you have a preexisting condition an insurance company is allowed to delay covering that condition for up to 6 months. Most don't but it is important to ask. The Affordable Care Act does not have any affect on secondary insurance regarding pre-existing conditions so the medigap plans are allowed to do it.

New York also requires insurance companies to do community rating for prices.  That means no matter how old you are your premium is the same as everyone else in the plan - it is based on where you live.  I don't know how they decide to set community prices but will guess it is based on demographics, physician prices (doctors are allowed in NY to charge up to 5% more than the Medicare fee for most procedures and 15% more for a small subset of procedures) and hospital pricing.  It is well known that hospitals charges range widely from one to another. 

IBM Medicare Extend Health EAP is ending on 12/31/13

I just called the IBM Employee Services Center and asked them about the Employee Assistance Program.  That's a benefit we got were we had access to psychologists for up to six sessions and it was included automatically in our benefits package at no extra cost. Sorry to say - it is gone.  I never used it so I don't know if it was valuable but am a little annoyed that it is just disappearing.  Dr. Rhee failed to mention that one!

IBM Medicare Extend Health Where to get more information

IBM insurance was great insurance but it was so convenient it stopped IBM retirees from really understanding the structure of Medicare.  We are now faced with having to deal with the structure. Medicare was created by committee and has been tweaked and poked by our legislators since its inception in 1965 so it really is hard to understand.  It requires a bit of a history lesson to even understand it.  I am not an authoritative source on the history but will try to give you enough so that you can understand what people mean when they talk about the Medicare.

I suggest you read a book Medicare sends you every year called "Medicare and You".  There are other resources to help you understand Medicare.  The Medicare Rights Center at 1-800-333-4114; a state agency called the State Health Insurance Assistance Program - www.shiptalk.org lists the phone numbers for each state; Medicare itself at 1-800-MEDICARE
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1965 - Medicare was created as a government, single payer  insurance for people over 65.  Sometime after that people with disabilities were added to the pool. It consisted of two parts. Medicare A for hospitalization and Medicare B for doctor services.  You have to work 10 years or 40 quarters to be eligible. You pay a premium for part B which is set by the government.  Part A is "free".  Medicare was not designed to pay 100% of medical costs, had medical procedure exclusions and did not include drug insurance. Because it didn't provide 100% cost coverage, secondary private insurance companies were allowed to offer "medigap" plans but the medigap plan structures were defined by Medicare.  There are 10 different kinds of medigap plans and each one is associated with a letter such as K, J, L, F.  Medicare changes the plans from time to time and some are no longer allowed to be sold but if you had the plan you can keep it.
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1997 - Private insurance companies lobbied the government to be able to offer alternative insurance to the government Medicare A&B plan.  In 1997 they were allowed to offer insurance (then called Medicare Choice).  The government requires the insurance companies to cover the same procedures and apply the same fee structure for a procedure but how the fee is split between the insuree and the provider is up to the plan. The government gave the insurance companies the client's part B payment plus some to cover part A. The companies tried to make money by limiting access to providers via hospital and doctor networks such as HMOs and PPOs
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2003 - Private insurance companies lobbied the government to provide a better subsidy because they weren't making any money.  The government increase their payment by 15%  per enrollee.  The Affordable Care Act is trying to eliminate the increase. The name of these policies change to be called Medicare Advantage plans.
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2006 - The government created part D prescription drug insurance plans.  However, these plans are only offered by private insurance companies.  There is no government insurance pool.  The government pays the private insurance companies a subsidy to sell these plans and defines the structure of the plans.  Some Medicare Advantages plans added drug insurance to their plans.

IBM Extend Health Questions and Answers

Many people have come to this post so I am adding an update here about the HRA subsidy that is really important.  Make sure you receive and read a letter mailed from IBM about survivor designation.  The "do nothing" default is that your HRA subsidy will be reduced even if you do not have a spouse or eligible dependents.  I can't even guess as to why that is true.  The letter was sent on 10/14/13.  You must take action by 12/16/13 if you want to keep your entire subsidy.

I finally reached an excellent Extend Health agent who seemed to know a lot.  Here are the questions and answers he gave me.  I cannot say for sure that he was correct so you should ask again when you talk to Extend Health. 

September 11,2013 

1.       Are all the Extend Health plans traditional CMS Medicare plans that are currently in the marketplace? Will there be any unique offerings like the IBM secondary medical plan that only kicks in after $4000+ deductable?  That was not a CMS approved plan.

Answer: There will not be any unique offerings at all.  Anything Extend Health offers is only what is available in the market place.  The offerings we had were specialized corporate offerings.  So there will be no Aetna Integration or specialized part D plans.
2.       There are no CMS approved plans for dental or vision insurance as separate plans.  Will these still be offered as separate insurance plans or is the only way to get this coverage  through a Medicare Advantage plan?

Answer: There will likely be dental plans offered but they will be ones that are available in the market place.  Plans like Humana Dental and Delta Dental will be offered.  Met life Dental is only sold as a corporate plan and not and individual plan so Met Life will not be available.  Make sure your dentist takes the specific plan that is offered.  Since there is no price advantage to buying the plan through Extend Health you might just want to buy it in the open market.  If you have bought at least ONE medical or part D insurance policy from Extend Health you will be able to use HRA subsidy money to pay for out of pocket expenses and premiums for dental and medical insurance even if it is not a plan available through Extend Health

3.       If the offerings are all traditional CMS plans are Medigap plans then subject to the same state rules as CMS Medigap plans?  Like not being able to switch Medigap plan types once you make a selection unless that plan type goes away.  Will Medigap plans be subject to state rules such as age rated premiums,  zip code rated premiums or delayed coverage for preexisting conditions? Does Extend Health negotiate private plan premiums so they are lower than what is available to the general market place?

Answer: Extend Health does not negotiate any premiums.  There is no price advantage to buying a policy through Extend Health and state rules apply regarding pricing by zip code or age rating.  Because the IBM group insurance plan is terminating people in any state will have a “guaranteed issue right” to buy whatever plan they want even if they did not have a medigap plan.  
   
4.       Does Medigap ‘guaranteed issue right’  apply even if someone only used the IBM’s prescription drug plan and had no secondary insurance or used a Medicare Advantage plan in 2013? If someone buys a Medicare Advantage plan in 2014 do they lose their ‘guaranteed right’ to buy a medigap plan in 2015?

Answer: Yes, “guaranteed issue right” will apply in 2014.  If you buy a Medicare Advantage plan in 2014 then state rules will apply in 2015 which will mean in some states you have no guaranteed issue 
right to buy a medigap unless your Medicare Advantage plan terminates.

UPDATE - I think this is not accurate - I now believe guaranteed issue right only applies for medigap purchases if you had an IBM medical plan in 2013.  If you only bought a prescription drug plan you might not have a guarantee issue right … it depends on the state you live in.  

5.        Will there be any non-CMS structured offerings like IBM’s prescription drug offering that had no donut hole and capped at $3500 of pay out – e.g, it was a CMS qualified plan because it was creditable coverage but not at all structured like a CMS part D plan. If there are any such plans will they still be subject to the higher premium rule for higher income individuals?

Answer: No, there will be no unique plans offered.  All CMS rules apply for any part D plan you decide to use.

6.       Your brochure (page 6) implies you will only be offering Medicare Advantage plans that include prescription drug insurance.  Is that true?

Answer: The offerings that will be available have not been published yet

7.       Both my spouse and I are IBM retirees.  Do we have to enroll separately versus as husband and wife to get our subsidies?

Answer: Each of you will have your own subsidy but you can enroll together and can pick the plans that suit each of your needs.  You do not need to enroll in the same plans.
   
8.       If I don’t buy insurance through Extend Health in 2014 am I precluded from buying through the exchange in future years?

Answer:  It appears you can – but ask this question again during your enrollment session.
  
9.        My spouse receives a Medicare part B premium subsidy and  gets reimbursed through SHAP reimbursement.  Your brochure implies (page 9) that the process will be the same and it is not part of the HRA process and subsidized coverage.  Is that correct?

Answer: Yes, that is correct
   
10.    You say your current insurance pool covers about 500K users for the companies you serviced before IBM contracted with you.  What is the current typical wait time for them to get answers to their questions? When IBM retirees join the pool how big will the pool become and what is your anticipated typical wait time to accommodate that big an influx of people?

Answer: I didn’t ask this question.

11.   How does the process work if a retiree is covered under a spousal plan but cannot continue spousal coverage after the spouse dies – and the spouse dies in the middle of the year?  Are there life changing events where the retiree then can use the Extend Health exchange or must they wait for the next enrollment period?

Answer:  Extend Health will be setting up a special group to handle those situations.  However, since the policy is terminating for the living spouse, Medicare gives the living spouse a Special Enrollment Period to switch to a new plan.  That can be done through Extend Health or directly by calling Medicare.
    
12.   How are advisors compensated?  Do they get a commission when the retiree decides to use an Extend Health offering and – if so – is it based on the premium of the offering?

Answer:  Advisors are salary based and do not receive commission for the products we buy (he said nothing about bonuses).

13.   Can you put claims in for medical expenses against the HRA that are not covered by the insurance plans you have through Extend Health? Like dental expenses or dental insurance premiums?

Answer:  YES!  As long as you have purchased a medical or part D insurance product through Extend Health you can put in claims for plans you did not get through Extend Health. However, I suggest you ask this question again (and again and again) to be sure.

UPDATE - if you are only buying a part D plan - it must be a different plan that what you bought in 2013 in order to get the subsidy.
14.   Will Extend Health allow us to enroll in any Medigap, Medicare advantage and drug insurance plans available in our zip code? If not, why not?

Answer: NO.  They are only authorized to sell some of the products.  Some insurance companies will not let them sell their products.

15.   Can you change your mind after an enrollment call and call again to switch to a different plan and do it  through 12/31/13?

Answer:  Only if you do your enrollment AFTER October 14, 2013.  If you do it before October 15, 2013 you will be only allowed a onetime change because you will be in a Medicare Special Enrollment Period because your company group plan is ending (I think this answer is not correct).

16.   What happens to unspent HRA subsidy money?  Who gets to keep it?

Answer:  It goes back to IBM.
   

Questions added on October 8, 2013:

1.       Can I submit bills to my HRA for reimbursement of medical procedures that are not covered by Medicare such as an annual physical by a doctor and associated blood tests (assuming I have money left to do so)?

Answer:  Yes, the IRS ruling for HRA accounts only require that it be a medically related procedure or drug cost.  Paying out reimbursement money from HRA accounts has nothing to do with Medicare.

2.       Can I submit bills to my HRA for reimbursement of doctor bills if the doctor does not accept Medicare insurance?

Answer: Yes – same rules apply as for answer #1.  HRA reimbursement has nothing to do with Medicare.

3.       Can I submit bills to my HRA for reimbursement of dental bills if I do not have dental insurance?

Answer: Yes – same rules as #1 - dental qualifies as a medically related procedure.

4.       Both my husband and I retired from IBM.  Can we submit bills for reimbursement to each other’s HRA accounts if there is money left in one account and not the other?

Answer: Yes!!!!

5.       If my medigap plan is no longer offered by EH in 2015 do I have to switch to a new EH plan at the end of 2014 to keep my subsidy? 

Answer:  You have to have at least one plan purchased through EH.  You would have to then buy a part D plan through EH if you didn’t want to switch medigap plans.  (I did not like this answer because not all part D plans are offered by EH and your drugs might not be covered by plans they offer. My bet is you could lobby for an exception in that case)

6.       If I want to switch to a 5 star Medicare advantage or part D plan during 2014 – which Medicare allows – will I lost my subsidy if it is not a plan sold through EH?

Answer: You will not lose the subsidy for a part D switch if you still have an EH medigap plan.  You would lose the subsidy for a Medicare Advantage switch.  (Again, I do not like this answer and will bet you could lobby for an exception)

IBM Extend Health DO NOT ENROLL BEFORE OCTOBER 15,2013

If you want the flexibility to change your mind about the insurance products you select from Extend Health after your enrollment call then DO NOT ENROLL BEFORE OCTOBER 15,2013.  It is a quirky Medicare thing. If you do you will be using a one time Medicare "Special Enrollment Period" aka an SEP that is provided because IBM's group insurance is going away. You are not allowed to make changes after that one time.

If you enroll on or after October 15, 2013 you will be enrolling during Medicare Open Enrollment which runs through December 7, 2013.  Then you can make as many changes as you want.

IBM Medicare Extend Health Does NOT Negotiate Insurance Premiums

It has been confirmed a couple of times that the Extend Health Medicare insurance products we will be offered are a subset of the SAME products in the general marketplace and will be the SAME price. One would think Extend Health would have more leverage with insurance companies.  Here's an even bigger irritant.  EH will probably not offer the cheapest Medicare insurance products in your zip code.  They offer insurance products where they are paid a commission from the insurance company to sell those products. 

I continue to urge you to decide what kind of products you want to get BEFORE you talk to an Extend Health advisor.  By way of example, I will tell you what I am doing. 

I looked on Extend Health's website to see what was offered to employees of other companies.  I did that by looking at www.extendhealth.com/dupont and www.extendhealth.com/gm  (isn't it interesting that anyone can go to www.extendhealth.com/ibm which is the site we are using to enter our profile information) and I saw the products offered by EH in my zip code in 2013. I am reasonably sure it will be the same stuff offered to us.  I am specifically interested in a medigap plan called F high deductible (F+).  Unfortunately, the F+ plan offered by Extend Health is not the cheapest plan in my zip code.  That's really irritating as there is no difference in the content of a medigap plan from one company to another.  By law, all F+ plans must offer the same coverage.  However, I have to use the one offered by EH to get the HRA subsidy. 

Here's my decision on what kind of products I want to buy:

1. I want maximum flexibility to be able to go to any Medicare accepting doctor or specialty clinic (ala Mayo Clinic) anywhere in the USA irrespective of where I live.
2. I want copay coverage (aka medigap secondary coverage).
3. I want the cheapest prescription drug coverage available that covers the one drug I use.
4. I want dental insurance only if it will include my existing dentist. 

Original Medicare is the only way I can satisfy #1. A Medigap plan is the only way I can satisfy #2 and as I said I decided I want Medigap plan F high deductible (F+). I will explain how I made that choice.  I will pick the cheapest F+ plan EH offers.For #3 I provided Extend Health with the name of the drug I take and will look on the medicare.gov website to see what plans are available in my zip code that cover my drug during Medicare open enrollment.  Hopefully, those plans are offered by EH.  If not, I will NOT use Extend Health to buy a part D plan.For #4 there is no research I can do.  I have to wait to see if EH offers a dental plan I can use.

I decided on an F+ Medigap plan because an F plans in general provide the most robust copay coverage and we are able to get reimbursed for our out of pocket expense from the HRA account.  Without a deductible ($2100/year) an F plan is really expensive and will likely use up all of the HRA subsidy and then sum.  It isn't worth it. Compare F monthly premium to F+ monthly premium + 175 (2100/12).If  F+  has a lower combined premium buy it whether or not you are healthy. If you get sick you'll hit the deductible but you'll submit the copay bills up to the deductible cap to EH for reimbursement.  If the plans have equal premiums and you are sick you may as well choose F (no deductible). If F+ premium is more expensive and you are healthy then decide if you want to take a gamble that your copays will be significantly less that $2100 for the year so you'll never pay out that much in copays.

Don't rely on the EH agent to do this work for you.  Get busy!