General Motors Retiree Health Insurance Eliminated
July 21, 2008 10:13 pm Medicare Supplements, Medigap Plans, New To Medicare, Prescription DrugsNews May Not be as Bad as it Sounds
On July 15th, General Motors announced that retired salaried employees 65 and older will lose their GM medical benefits. In exchange, GM will increase pension payments by $300 per month. My father is a retired GM employee, so I am very familiar with this situation.
The information below will hopefully answer some of your questions, and eliminate some of the fear, uncertainty and confusion, that you are feeling. Most General Motors retirees have had Medicare since they turned 65. You should have a red, white and blue Medicare card in your wallet or purse like the one below.
You will see two dates on the card, a Hospital (Part A), and a Medical (Part B) date. These are the dates that you enrolled in each part of Medicare. Your GM insurance is your “Secondary” insurance. It pays some or all of what Medicare does not cover. Medicare also has two other “parts.” Part C is the name for Medicare Advantage Plans. Part D is Medicare prescription drug coverage.
Medicare Supplement = Medigap
Medicare Supplement Insurance is the same thing as Medigap Insurance. Some people call it Medicare Supplement because it “supplements” Medicare. Others call it Medigap, because it fills in some or all of the gaps that Medicare does not cover.
Let’s keep this simple
What you need to do, is select a Medigap plan for your secondary insurance, and a Part D plan for your prescriptions. The $300 increase in your monthly pension check is more than enough to cover a comprehensive Medicare supplement and a Prescription plan. You can even add dental plan and final expense life plan and still come out ahead.
Medigap plans are Standardized
What does this mean? It means that Medicare designs the Medigap plans. There are over a dozen Medigap plans. They each have a letter designation A-L. For several years, Plans C, D, and E were the most popular, now days most retirees go with Plan F or Plan G. The most important thing to remember is this, and I’m going to say it several ways to emphasize the point:
- Plan F is Plan F no matter what company you get it from
- There are no differences between plans of the same letter from different companies
- Plans of the same letter are 100% identical
- The only difference between like plans from two different companies is the premium
If you have a fast Internet connection then click on the following link to download a booklet from Medicare called “2008 Choosing a Medigap Policy” and be sure to read the first paragraph on page 14. What this means is that once you decide which plan you want, you need to select the Insurance Company that has the best premium on that plan.
Important Dates to Remember
Since you are losing your GM group coverage under no fault of your own, Medicare provides a “Special Enrollment Period” for you. This SEP means that your application to ANY Medigap Plan and ANY Prescription Plan is Guaranteed to be accepted. This means that you should select the Medigap plan with the lowest premium you can find from a reputable Medicare Supplement Insurance Company. In some states, if you use tobacco, you will still get Non-tobacco rates during your SEP.
What Should You Do Now?
If you live in Georgia, Tennessee, South Carolina or Alabama, you can call 1-800-315-6898 and we can answer all of your questions. You can also Click Here to Submit Questions regarding GM retiree Health Insurance. Also feel free to post questions or comments below. We’ll get back with you usually within one business day.
I hope this information is helpful. The switch from a Group health insurance plan to a Medicare Supplement Plan is confusing at first, but you will soon realize that if you select the right plan, you will still be covered very well. Many people may find that they have fewer out of pocket expenses than before.
Conclusion
The majority of U.S. retirees do not have Group coverage, they have Medicare and a Medicare Supplement (Medigap) plan. If you talk to some of your friends and family with these plans, you will find that the vast majority of them are very happy with their coverage. Many experience NO out of pocket expenses at all throughout the year other than their premium. The simple fact is that Medicare and Medicare Supplements work very, very well most of the time, and I’m sure you will have the same great experience. If Southern Senior Care can be of any help to you, please let us know.
Henry Strickland :
Date: December 5, 2008 @ 4:52 pm
My dad is a salaried GM retiree. My concern is not the loss of health insurance but the loss of long term care insurance. He enrolled in a LTC plan through GM in the late 1950s and has had a premium deducted monthly ever since. The LTC insurance is being cancelled along with the health insurance, but it is not being replaced. LTC is not covered by medicare and unlike health insurance it cannot now be purchased by an 80 year old. Has anyone looked into options available or the the legality of this cancelateion?
Herman Bruns :
Date: December 29, 2008 @ 10:11 pm
You can definitely purchase LTC insurance over the age of 80, but it is not cheap and you have to be healthy enough to qualify. Some carriers stop at 79 and some go much further. GM taking it away is unfortunate.
mary mcclean :
Date: April 15, 2009 @ 7:02 am
My husband is a retired GM salaried employee who has not received the the $300. monthly health reimbursment this year. After calling GM, I was told that there was a mistake and he would receive a check on June 1, 2009 - the same date they will probably declare bankruptcy. The person I spoke to at GM didn’t know if he would receive the payment if bankruptcy was declared. Does anyone know?
Vanna Kelly :
Date: June 9, 2009 @ 7:41 pm
It is my understanding based on what my father said. He started working go GM in 1952. If I remember right, Dad said that in 1957 they began taking an nickel an hour from wages to cover for insurance. He said they had none before that. That means that for all these years employees have in effect payed for their insurance. My father passed in 1997 and now my mother gets a small survivors pension. She worked for many years but she is covered by his insurance. She is 75 yrs old. It is devastating. I don’t understand how they can take away benefits from the most vulnerable of retirees.