Where the money is....

When Willie Sutton bank robber was asked why he robbed banks he said "Because that is where the money is". How things have changed.

The banker's Bank the Federal Reserve is now robbing savers with near zero interest rates. Why? Because that is where the money is. It is a hidden tax. No law was passed. Still you are having the your money stolen through near zero interest rates to restore bank's balance sheets. If you had $300,000 in an IRA (or 401k) earning 5% in 2007 ($18,000 a year with nearly no risk) you are lucky if you earn half that today. That is a $9,000 or more of hidden taxes.

I hope to expose these types of actions and others by the FED and government. Boomers need to be vigilant - because their savings is where the money is. I will also delve into other areas of finances of interest to Boomers.

Saturday, April 30, 2011

Medicare has more holes than Swiss Cheese

For those of you nearing 65 and can qualify for Medicare you need to do some research. We are hearing a lot of talk about Medicare and how it is sacrosanct to the older retired population.  Well, to begin with it is not a free ride.  It will cost you about $100 For Medicare Parts A & B ( hospitalization and doctor's visit).

To begin with there is a $1,132 copay for hospitalization and $162 copay for physician visits.  So even for a short hospital stay and a couple of visits to the physician you will pay another $1200 (or $100 a month). 

After 60 days in the hospital Medicare  - for days 61-90 you pay $283 a day (that is $8,490).  For days 91-150 you pay $566 a day ($33,960).  So for a 150 day hospitalization you could pay  $43,582.  After 150 days medicare pays nothing!!!

Also, during hospitalization Medicare pays only 80% of physician expenses.  For a $60,000 physician bill that would leave you owing $12,000 or more for an extended hospitalization.   So an extended hospitalization could cost you over $50,000.

If you are not sick enough to be hospitalized then it is not much better.  Medicare pays 100% of approved costs for the first 20 days in a skilled nursing facility , all but $141.50 a day for days 21-100  and nothing after 100 days.  If you become disabled (say a stroke leaves you incapable of caring for yourself?) you are screwed.  You will end up broke and on Medicaid (have seen it happen in my own family).  Insurance cost for extended care is very expensive and may not be affordable.

My point is - Medicare is not the solution many think it is.  So you will want supplemental insurance to help cover the hospital and physician costs not covered by Medicare.  A good hospital/physician supplemental plan will probably cost $200-250 a month.

So even if you remain healthy you can expect topay  $350 or so a month (over $4,000 a year) for health insurance ($100 for Medicare and $250 for supplemental insurance).  This is before drug coverage.  Drug coverage cost will vary based on the plan you select and your need for drugs.

So it is amazing how politicians play on fears of the elderly and misrepresent the actual benefits of Medicare.  Like I said to start off this post - if you are nearing 65 you need to do some research so you can select the appropriate supplemental insurance plans.  Medicare is not the "be all" many of you think it is.  A voucher system to purchase your own insurance (ie Medicare Advantage that Obama's health care plan wipes out) may be superior to the current mess know as Medicare. One would have to see the details and costs of insurance.  Don't wait until the last minute to do start your research - this is much too important and the wrong decisions can be financially catastrophic.

No comments:

Post a Comment