New Seniors

I am covered by Medicare and also purchase supplemental health insurance, along with prescription coverage, from one of the nation’s better known providers.  Recently a letter arrived at my home stating there would be no increase in premiums for the Preferred Provider Organization (PPO) coverage during 2010.  However, the next day I received the invoice for the prescription plan; there was no notice just a bill representing an increase for the third year in a row.

New Seniors, particularly those of us living in high-cost areas like Southern California, are concerned about the cost of insurance.  So, I did some research and crunched the numbers to see how bad things really were.  Before going back in time, let’s look at how rates for supplemental coverage from my insurance provider continue to climb for those born between 1930 and 1945 as we age.  After moving from the attained age of 65 to 69 into the 70 to 74 group, there is a 35.3% hike in premiums.  Another bump of 19.9% occurs for individuals between the ages of 75-79; but the actual dollar increase is about the same, since the base is higher.  This means there is a difference of 74.5% between what older new seniors pay versus the younger ones.

My four-year rate analysis includes the period from 2007 through the announced premiums for 2010.  The numbers behind the numbers tell a rather sad story.  Take my prescription plan.  The increase from 2007 to 2008 was 25.2%, 2008 to 2009 another 14.2% and 2009 to 2010 up 13.3%.  This results in my prescription drug insurance coverage costing 68.4% more than it did in 2007.  That’s more difficult to swallow than some of the pills I take.

Dropping the drug coverage doesn’t make sense, since I’m at the age where more, rather than fewer, prescriptions may be needed to keep me up and running.  A study released by the General Accountability Office (GAO), the research arm of Congress, states that during a recent eight-year period 416 brand-name drug products experienced price increases ranging from 100 to nearly 500%, and in some instances as much as 1,000%.  So I’m going to hold on to the coverage.

The medical insurance doesn’t appear as bad as my drug coverage, because there were only two increases since 2007.  However, the 13.2% increase was nearly twice as much in actual dollars as the additional prescription premiums.  Little solace can be found in the apparent good news coming from the medical portion of my insurance package.

Since the House and Senate have health care plans waiting to be reconciled, there’s no way to predict what affects the final bill will have on my individual coverage.  It’s up to each new senior to find out what this will mean in terms of personal costs as well as the quality of health care received.  Then, we must let our voices be heard, because it’s never too late to get it right.  Even if politicians seem to turn a deaf ear to public opinion, they cannot ignore the power of the ballot box.

Don Potter: Editor-in-Chief

Don Potter, a veteran of the ad agency business, is a Philadelphia native currently living in Los Angeles. He is the author of an acclaimed marketing book, The 50+ Boomer: Your Key to 76 Million Consumers. In retirement, Potter has written two novels, hundreds of articles and is a frequent lecturer. A leading advocate for those 65+, he is a founder of NewSeniors.com.

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