Your greatest financial risk today and in the foreseeable future is not your hospital or doctor bills, but the very high cost of long term care. Over 40% of all Americans over the age of 65 will spend some time in a nursing home due to a prolonged illness or disability. That's almost one out of two. Will it be you or your spouse? Your risk of needing long term care is probably much greater than you realize.

If you are over 62 years old and have assets to protect, but aren't wealthy enough to comfortably pay for long term care out of your savings, let us help you put together the best possible solution for you long-term care needs with our Senior Care Package.

Long-Term Care

  • Allianz TermLTC - Affordable low cost coverage
  • Allianz Future Select Plus - Comprehensive lifetime coverage
  • Golden Rule Asset Care - Single pay LTC and asset protection
  • 10 pay Asset Care - 10 year fixed pay lifetime protection

Medicaid Friendly Income

  • Fixed Annuities - Fixed rate returns for fixed periods
  • Bonus Annuities - Extra income to offset penalties
  • Indexed Annuities - Participate in the markets without risk

Life Insusrance with Long-Term Care Provisions

  • Allianz Generation Planner - Life Insurance and LTC all in one
  • Golden Rule Asset Care I - Can combine IRA and LTC++

Annuities with Long-Term Care Provisions

  • Golden Rule Annuity Care - Fix LTC cost even if in nursing care, can combine IRA and LTC++
  • Golden Assurance - Free surrender if LTC is needed

Contact Pillar today to find out more about putting together long-term care provisions to best meet your particular needs.

FACT: The average Ancient Greek lived until age 18. The median life span of a Puritan was 33. In 1991, the average American life expectancy was about 72 years for men, 79 for women.

FACT: In 1994, about one in eight Americans was age 65 or older. By 2030, one in five Americans will be a senior citizen.

FACT: 1n 1994, 7.3 million Americans needed long term care services at an average cost of nearly $43,800 per year. By 2000, this number rose to 9 million Americans at nearly $55,750 per year, and due to inflation, by 2060 it will skyrocket to 24 million Americans paying over $250,000 per year to receive long term care.

The Long Term Care Insurance National Advisory Council

Review more information about long-term care below:

| About Medcaid | Medicare Supplement | Medicare Friendly Income Products |
Medicare Supplement Plans A, C, F, G |

Purchasing a Long Term Care Insurance Policy

Should You Consider Purchasing a Long Term Care Insurance Policy?

Yes, You Should Consider It If:

  • You have a significant income and / or assets.
  • You wish to help protect your assets and income.
  • You do not want to rely on the Government or others to pay for your care.
  • You do not want to rely on friends or family to provide you care if needed.

No, You Should Not If:

  • You can not afford to pay the policy premiums.
  • You have a limited amount of assets and / or a very small income.
  • Your only income is Social Security or SSI ( Supplemental Security Income).
  • You have trouble affording the basics, rent, utilities, food, medical needs or medicines

Long Term Care Health Insurance Terms

Accelerated Death Benefit. This is when a consumer can use a feature in their life insurance police allowing them to use some of their policy's benefits before dying.

Activities of Daily/Selected Living (ADLs). A scale that measures disability or the ability to perform functions of daily living. Often three out of six or two out of five activities. ADLs usually include bathing, moving from one location to another, eating, dressing, going to the toilet, and sometimes cognitive ability.

Adult Day Care. Adult day care provides care during the day for adults, usually at senior or community centers to relieve caregivers. It may be purely recreational or may include occupational and physical therapy. Programs may include meals, transportation, health, and related support services.

Area Agencies on Aging (AAA's). A local (city or county) agency, funded under the federal Older Americans Act, that plans and coordinates various social and health service programs for persons 60 years of age or more. The network of AAA offices consists of more than 600 approved agencies. Call your city or county government for the name, address, and telephone number of the AAA in your community.

Assisted Living Facility. This is a place where consumers can live in a residential living environment when they require and receive assistance with their activities of daily living such as individual personal care and health services.

Board and care homes. Are typically privately operated facilities that provide a room, meals, personal care services, and 24-hour protective oversight.

Care management services. A service provided by a professional, typically a nurse or social worker, who arranges, monitors, and coordinates long-term care services, including health and social services, from multiple providers for an extended period of time.

Cash value (Cash surrender value). The amount available in cash to be borrowed against or obtained in cash if a life insurance policy is canceled.

Chronic illness. An illness marked by long duration or frequent reoccurrence such as arthritis, diabetes, heart disease, asthma, and hypertension. These conditions are also considered permanent, sometimes with disabilities, may require rehabilitation instruction, or long period of supervision and care.

Community-based services. Those services that are designed to help older people remain independent and in their own homes; can include senior centers, transportation, delivered meals or congregate meal sites, visiting nurses or home health aides, adult day care, and homemaker services.

Congregate housing. Operated by many different groups, congregate homes offer independent living with some central facilities and services that can include transportation, recreation, social, and health services.

Conditionally renewable. Policies with this provision are no longer sold, but older policies may still be in force. When a policy is conditionally renewable, an insurance company agrees to continue insurance for an individual policyholder as long as it continues to insure everyone in the same state holding the same kind of policy. This is not a guarantee of continued coverage, and policyholders have better protection with a policy that is guaranteed renewable.

Continuing care communities. Offer housing and a range of health care, social, and other services for substantial initial costs plus monthly fees.

Custodial care. Assistance with bathing, dressing, eating, taking medicine, and similar personal needs. Custodial care can be provided by people without medical skills or training.

Daily benefit. This is a certain amount of insurance benefit dollars that consumers can purchase for long-term care insurance expenses.

Elimination period. The period of time before insurance benefits begin. Friendly visitor. Volunteers who visit the homebound to sit and talk or sometimes to run errands and shop for them.

Guaranteed renewable. A policy that is always renewable as long as premiums are paid. A company may raise premiums for all policyholders within a particular group.

Health Insurance Portability and Accountability Act (HIPPA). This is a federal law that became effective on July 1, 1997 that provides consumers certain protection insurance wise when they have pre-existing medical conditions. It also helps long-term care insurance policies to be qualified for some federal tax advantages or benefits.

Home health care. Includes a wide variety of services that bring care to the home: skilled nursing care, physical and occupational therapy, speech therapy, personal care, and the assistance of home health aides (sometimes referred to as homemakers) with chore services.

Homemaker services. This is a trained professional offering interior home services to a consumer who can no longer complete household tasks themselves such as cleaning, preparing meals, or doing laundry.

Inflation protection. This is when a policy has a built in feature where you are provided more benefit money to help pay for the increased costs of long-term care services.

Long-term care insurance. Insurance that pays for medical and personal services for a chronically ill or disabled person; covered services may include nursing home care, home health care, adult care, and respite care.

Lapsed policy. A policy terminated for non-payment of premiums.

Medicaid. A medical insurance program for low-income individuals that is paid by federal and state funds.

Medicare. A federal government health program available to people over 65 and some other citizens meeting specified requirements.

Medigap insurance or Medicare supplement. Medicare supplement insurance, or Medigap (sometimes called MedSup), is private insurance that supplements or fills in many of the gaps in Medicare coverage. While MedSup policies typically cover Medicare's deductibles and co-insurance amounts, they do not pay benefits for long-term care.

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National Association of Insurance Commissioners (NAIC). NAIC is a national organization of the 50 state insurance commissioners for exchanging ideas, information, and coordinating regulatory activities. NAIC has no legal power but exerts a strong influence through its recommendations.

Noncancelable policy. A policy that guarantees the premium will remain the same and the policy stay in force as long as the premium is paid.

Non-forfeiture Benefits. It is a policy feature that gives you partial reimbursement of your premiums when you cancel your policy or you are lapsed in paying the premium.

Nursing home - levels of care.

1. Skilled Nursing is for persons who need intensive care, 24-hours-a-day supervision and treatment by a registered nurse, under the direction of a doctor.

2. Intermediate Care is suitable for persons who do not require around-the-clock nursing, but are not able to live alone.

3. Custodial Care is suitable for many persons who do not need skilled nursing care, but require supervision (for example, help with eating or personal hygiene). Insurance companies' definitions may differ somewhat from the above so check the policy.

Older Americans Act. Federal legislation enacted in 1965, and since amended, to set up a network of state and area agencies on aging which plan, coordinate, and fund local programs of services for persons aged 60 or older.

Period of confinement. The time during which you receive care for a covered illness. The period ends when you have been discharged from care for a specified period of time, usually six months.

Personal care. Assistance given people who need help with ADLs such as dressing, bathing, personal hygiene, grooming, or eating.

Rescind. The insurance company cancels a policy.

Respite care. Offers a few hours to several days of help to family members caring for a homebound person. The care may be provided by volunteers, an institution, or an adult care center.

Rider. An amendment to a policy that modifies the policy by expanding or restricting its benefits or excluding certain conditions from coverage.

Skilled nursing care. Daily nursing and rehabilitative care that can be performed only by, or under the supervision of, skilled medical personnel.

Social Services Block Grant. A federal program established under Title XX of the Social Security Act to fund non-medical services for low-income persons.

Spend Down. When individuals deplete their income and assets and thereby meet Medicaid financial eligibility requirements.

Spousal Impoverishment Act. Rules, which allow the at-home spouse of a Medicaid-eligible nursing home resident to keep a minimum of joint income and assets as, determined by the state.

State Health Insurance Program. Usually you see the acronym of SHIP for this word. It is a federally funded program that trains volunteers to help provide health insurance counseling to senior citizens.

Tax-Qualified Long-Term Care Insurance Policy. This is a long-term care insurance policy that conforms to the federal laws and provides some positive federal tax advantages.

Term life insurance. Insurance protection that pays death benefits to survivors but no cash value buildup.

Third Party Notice. This is when a third person such as a relative, friend, lawyer, or accountant is notified when a relative's, friend's, or client's insurance policy is about to stop due to the lack of premium non-payment.

Underwriting. Classifying applicants for insurance according to their degrees of insurability so that the appropriate premium rates may be charged.

Universal life insurance. A flexible premium life insurance policy under which the policyholder may change the death benefit from time to time (with satisfactory evidence of insurability for increases) and vary the amount or timing of premium payments. Premiums (less expense charges) are credited to a policy account from which mortality charges are deducted and to which interest is credited at rates that may change from time to time.

Waiver of premium clause. A policy provision that continues the policy without premium payment while the subscriber is ill or disabled. Whole life insurance. A cash value life insurance policy that provides level protection for a level premium as long as premiums are paid and includes a savings feature.

Viatical settlement. A transaction in which a life insurance policyholder who is terminally ill sells his or her rights to the policy in exchange for immediate payment of a portion of the death benefits.

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American Association of Retired persons. (Revised 1991). Before You Buy: A Guide To Long-Term Care Insurance. Washington, D.C.: AARP's Health Advocacy Services and Program Coordination and Development Department, 41-43. Health Insurance Association of America (HIAA). (1992). The Consumer's Guide to Health Insurance. Washington, D.C., 22-25. Health Insurance Association of America, (HIAA). (1991). The Consumer's Guide to Long-Term Care Insurance. Washington, D.C., 20-23. Illinois Department of Insurance, (IDI). (2001). Long-Term Care Insurance. Springfield, IL. National Association of Insurance Commissioners, (NAIC). (1999). A Shopper's Guide to Long-Term Care Insurance. Kansas City, MO., 1-45. United Seniors Health Cooperative, (USHC). (2001). Long-Term Care Planning: A Dollar and Sense Guide. Washington, D.C., 1-95. Updated in March 2001 by Katherine Reuter, University of Illiniois Extension Consumer and Family Economics Educator, Countryside Extension Center. Initially prepared November, 1994 by the Consumer and Family Economics Team's Insurance Committee: Katherine J. Reuter, Chair, Mary Ann Fugate, Brenda Cude, State Specialist, Maxine Kimmel Charlotte Crawford, and Laurie Sula. The University of Illinois Extension provides equal opportunities in programs and employment. Reviewed and updated as of 7/17/01.

About Medicaid
The Medicaid program provides medical benefits to people who are financially needy. This program is not primarily a program for people who are elderly. Rather, it is for people who are poor. It is not available to seniors under the age of 65, unless they are blind or disabled. However, Medicaid eligibility is important to seniors due to gaps in Medicare coverage. For example, as a result of Medicare's limited nursing home coverage, less than 10 percent of nursing home costs in Michigan are paid by the Medicare program. Due to the high cost of nursing home care, many seniors living in nursing homes need Medicaid to help pay for their care. Medicaid also pays for support services provided to people with disabilities through the Family Independence Agency and the local Community Mental Health system.

The Federal Department of Health and Human Services, the Michigan Department of Community Health and the Family Independence Agency administer Medicaid. The program uses both federal and state funds.

Some people mistakenly believe that any indigent person may qualify for Medicaid. The fact is, that to qualify for the Medicaid program, a person must pass 4 eligibility tests:

(1) Categorical Eligibility: blind, disabled, age 65 or older, SSI recipient, former SSI recipient;

(2) Non-financial Eligibility: Michigan resident, United States Citizen or Alien status, social security number;

(3) Financial Eligibility Requirements: asset poor; income poor;

(4) Procedural Requirements: complete and sign an application form, provide timely proof of eligibility, and report changes in circumstances.

To apply for Medicaid, contact your local Family Independence Agency. There is at least one office in every county. You can pick up an application form ahead of time if you wish. Application can be made at any time.

The financial eligibility requirements of this program are complex and confusing. Medicaid has specific limits on the amount of assets and income you are allowed to keep and still qualify for Medicaid nursing home coverage. Income includes any money or payments you receive such as Social Security benefits pensions, interest, dividends, rent from a tenant, or Veteran's benefits.

An asset is anything that you already own. Medicaid counts some assets toward your eligibility, and exempts others from affecting your eligibility. The most common countable assets are:

(1) cash, savings and checking accounts;

(2) certificates of deposit;

(3) U. S. Savings Bonds;

(4) individual retirement accounts and Keogh plans;

(5) nursing home trust funds;

(6) prepaid funeral contracts which can be cancelled;

(7) trusts (depending on the terms of the trusts);

(8) real estate, or land contracts or mortgages held on real estate;

(9) boats or recreational vehicles; and

(10) stocks, bonds and mutual funds.

A single person can have up to $2,000 in countable assets and still be eligible for Medicaid. In addition, a single person can have assets that are exempt from deter- mining their eligibility for Medicaid. The most common exempt assets are:

  • Your home
  • Personal belongings and household effects
  • Your car
  • Income-producing real estate (the annual income after expenses must equal at least 6% of your equity, and any income that equals more than 6% of your equity may be considered an asset)
  • An irrevocable prepaid funeral contract
  • Life insurance proceeds which are assigned for your funeral expenses (and the funeral expenses of your spouse). There is a limit to how much you can assign
  • Burial space items and services for you, your spouse or members of your immediate family. This includes such items as a casket, burial plot, vault, head- stone and the opening and closing of the grave site
  • A burial fund which is set aside for funeral expenses not covered by the burial space exclusion
  • Up to $1,500 cash surrender value of life insurance
  • Assets which you and your spouse do not have the legal right to use or dispose of
  • Assets you and your spouse have been unable to sell. The asset(s) must have been up for sale for a least 30 days during the last 3 months. The asking price must not have been more than fair market value. You must not have received a reasonable purchase offer.

If you own an asset jointly with someone else, Medicaid will consider the entire asset to be yours (if the asset is cash, savings and checking accounts and other similar types of assets). If the asset is real estate, you and the other owner(s) will be considered to own equal shares of the property unless the deed states otherwise. Giving away or selling your assets for less than they are worth will affect your eligibility for Medicaid coverage. If you give away assets in order to become eligible for Medicaid, you may be ineligible for Medicaid coverage for a period of time (please note this may not apply if you receive SSI). The period of ineligibility is based on how long the assets could pay for private nursing home costs. This amount is often referred to as the divestment penalty divisor, and in 2003 that amount is $5,043.00. Transferring assets to your spouse or your blind or disabled children, and specific types of trusts will not affect your Medicaid eligibility. If you anticipate applying for Medicaid coverage, you should seek legal counsel before giving away or transferring any of your assets.

There are special asset rules that apply to a married couple when one spouse is in a nursing home (often referred to as the "institutionalized spouse"), and the other spouse is not (often referred to as the "community spouse"). These rules are triggered when a person with a community spouse begins a continuous period of care of at least thirty (30) consecutive days where they have been or are expected to be in a hospital; and or in a long-term care nursing home facility.

The first day of a continuous period of care is called the initial assessment date. At this time an Initial Asset Declaration form will be filled out for the married couple. All of the couple's countable assets will be added together to comprise the initial assessment amount. This amount is then divided by two to produce a "spousal share" upon which Medicaid eligibility is determined.

The community spouse may retain all exempt assets, plus the "community spouse protected resource allowance". This allowance is determined as of the date of the initial assessment. The community spouse resource allowance is generally the greater of the spousal share or $18,123.00, up to a maximum community spouse resource allowance of $90,660.00. These amounts are adjusted annually for inflation, and the numbers referenced here are the 2003 figures.

The spouse in the nursing home will be disqualified from receiving Medicaid until all non-exempt assets and income in excess of the community spouse resource allowance are spent down. Remember that you must also be considered income poor to qualify for Medicaid. Medicaid is intended to be a cost-sharing program; therefore a recipient must pay for a portion of their cost of care.

The amount of income the recipient is required to contribute is called the "patient-pay amount". Subject to the following deductions, all of the person's income must be spent towards the cost of medical and nursing home care:

(1) Payments for health insurance premiums;

(2) Guardianship/Conservatorship expenses up to a maximum of $60.00;

(3) A $30.00 monthly income allowance;

(4) Family and children's allowance which applies when there are other family members legally dependent on the Medicaid recipient; and

(5) The community spouse income allowance (discussed below).

Income from investments solely in the husband's name is considered available solely to the husband. Income from investments in the wife's name is considered available solely to the wife. Income from assets that are held jointly by the husband and wife are divided equally among the spouses. That means the community spouse will be able to keep half of the income from a joint investment. The other half will be used to calculate the patient pay amount.

The spouse in the nursing home can divert income to meet the needs of the community spouse.

This allows the couple to divert enough of the nursing home spouse's income to bring the community spouse's income to a minimum of $1,493.00, with a maximum of $2,267.00 in 2003.

The allowance may also be increased, if the community spouse does not have sufficient income to cover his or her housing costs.

More Information
This is only a brief overview of two important but complex programs. Further information on these topics can be obtained from the following sources:

(1) For information about Medicare, call (313) 225-8317 or 1-800-482-4045;

(2) For information about Medicaid call 1-800-642-3195;

(3) For information about both programs contact your local area agency on aging, or the Michigan Office of Services to the Aging at 1-800-MEDICAR.

Please keep in mind that if you disagree with a decision made in respect to your benefits you may request an appeal. The following resources are available to assist you with additional information, or requesting an appeal:

(1) Michigan's Medicare/Medicaid Assistance Program (MMAP): This is a state- wide health insurance education and counseling program. Direct counseling services are provided over the phone, at senior centers, or through home visits for those with mobility limitations. The telephone number is (517) 374-8230;

(2) The Legal Hot Line for Older Michiganians is available to all Michigan residents 60 years and older, regardless of income. Hot line attorneys determine if callers have a legal problem, give free legal information over the phone, and provide brief services. Problems that cannot be resolved by the hot line are referred to legal aid organizations, pro bono attorneys, or to attorneys in private practice who agree to charge reduced fees. The telephone number is 1-800-347-5297.

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Medicare Supplement
Medicare is a federal health insurance program for people over 65 years of age or better, and certain younger people with disabilities or End-Stage Renal Disease (permanent kidney failure). The program contains 2 parts:

Part A – Hospital Insurance

  • Part A helps pay for care in hospitals, some skilled nursing facilities, hospice, and some health care.
  • For most people, Part A is premium-free because they paid Medicare taxes while they were working.

Part B – Medical Insurance

  • Part B helps pay for doctors, outpatient hospital care, and some other medical services that Part A does not cover, such as the services of physical and occupational therapists, and some home health services.
  • You pay the Medicare Part B premium of $45.50 per month in 2000.
  • You are automatically eligible for Part B if you are eligible for premium-free Part A. You are also eligible if you are a United States citizen or permanent resident age 65 or better.

It pays for much of your health care, but not all of it. You still pay for some costs yourself, unless you buy more insurance. This is where Medicare Supplement policies come to play. We will discuss this issue later on.

Medicare General Enrollment Period is from January 1 through March 31 of each year. You can sign up for Part A or Part B at your local Social Security Administration office. Part B coverage will start on July 1 of that year.

If you did not take Part B when you were first eligible because you or your spouse were working and had group health plan coverage through your or your spouse’s employer or union, you can sign up for Part B during a Special Enrollment Period.

You can sign up anytime you are still covered by the employer or union group health plan through your or your spouse’s current or active employment, or

Within 8 months of the date when the employer or union group health plan coverage ends, or when the employment ends (whichever is first).

If you are disabled and working (or you have coverage from a working family member), the Special Enrollment Period rules also apply. Most people who sign up for Part B during a Special Enrollment Period do not pay higher premiums. However, if you are eligible, but do not sign up for Part B during the Special Enrollment Period, the cost of Part B may go up.

What is a Medicare Supplement policy and how does it work?

A Medicare Supplement policy is sold by private insurance companies to fill the "gaps" in Original Medicare Plan coverage. In all but three states (Minnesota, Massachusetts, and Wisconsin), there are 10 standardized Medicare Supplement plans called "A" through "J". Each plan has a different set of standard benefits.

When a Medicare Supplement policy is purchased, you pay a premium to the insurance company. As long as you pay your premium, policies bought after 1990 are automatically renewed each year. This means that your coverage continue year after year as long as you pay your premium. You still much pay your monthly Medicare Part B premium.

Question: If I am in the original Medicare Plan, why would I buy Medicare Supplement Insurance?

Answer: Medicare Supplement Insurance may help you lower your out-of-pocket expenses and receive more health insurance coverage.

You may want to buy Medicare Supplement Insurance because the original Medicare program does not pay for all of your health care. There are “gaps” or costs that you must pay. Purchasing a Medicare Supplement Insurance policy may fill these “gaps” or costs.

When you purchase a Medicare Supplement Insurance policy you pay a premium to the insurance company selling the policy. As long as you pay your premium, policies bought after 1990 are automatically renewed each year. This means that your coverage continues year after year as long as you pay your premium. However, you still must pay your monthly Medicare Part B premium.

You do not need to buy a Medicare Supplement policy if you are in a Medicare managed care plan, Private Fee-for-Service plan, Medicare Medical Savings Account plan, or a Religious Fraternal Benefit plan.

In all but three states (Massachusetts, Minnesota, and Wisconsin), you can buy any one of up to 10 standardize Medicare Supplement policies (Plans A through J) that are sold in your state. Each standardized Medicare Supplement policy must cover basic benefits which includes:

  • Inpatient Hospital Care: Covers the Part A coinsurance and the cost of 365 extra days of hospital care during your lifetime after Medicare coverage ends.
  • Medical Costs: Covers Medicare Part B coinsurance (generally 20% of the Medicare approved payment amount).
  • Blood: Covers the first 3 pints of blood each year.

Mutual of Omaha and State Mutual sells Plans A, C, D and F.

Question: When is the best time to buy a Medicare Supplement Insurance policy?

Answer: The best time to buy a Medicare Supplement Insurance policy is during your open enrollment period.

Your Medicare Supplement open enrollment period last for 6 months. It begins on the first day of the month in which you are both age 65 or over; and enrolled in Medicare Part B. If you buy a policy during your Medicare open enrollment period, the insurance company must shorten the waiting period for pre-existing conditions by the amount of previous health coverage (creditable coverage) you have.

Question: How can I tell if I am in my Medicare Supplement open enrollment period?

Answer: Your Medicare card shows the dates that your Part A and/or Part B coverage started. If you are age 65 or older, you can figure out whether you are in your Medicare open enrollment period by adding 6 months to the date that your Part B coverage starts. If that date is in the future, you are still in you Medicare open enrollment period. If that date is in the past, you have missed your Medicare open enrollment period.

Question: What situations give me the right to buy a Medicare Supplement policy after my open enrollment period ends?

Answer: There are certain situations involving health coverage changes where you may have the right to buy a Medicare Supplement policy after your open enrollment period ends. These are called “guaranteed issue” rights because insurance companies are required by law to issue you a policy.

For example:

  • Your Medicare managed care plan or Private Fee-for-Service plan is leaving the Medicare program or stops giving care in you area; or
  • You move outside your Medicare health plan’s service area; or
  • You leave the Medicare health plan because it failed to meets is contract obligations to you; or
  • You are in an employer group health plan that supplemented or paid some of the coasts not paid for by Medicare, and the plan ends you coverage; or
  • Your health coverage ends through no fault of your own; or
  • You dropped your Medicare Supplement policy to join a Medicare managed care plan, or Private Fee-for-Service plan, or buy a Medicare Select policy for the first time, and then leave the plan or policy within one year after joining.
  • You joined a Medicare Health plan when you first became eligible for Medicare at age 65, and within one year of joining you decided to leave the Medicare health plan.

In these conditions, the Medicare insurance company cannot deny you insurance, place conditions on a policy, or charge you more for a policy because of past or current health problems.

Important Note:

If you are under age 65 and disabled or have End-Stage Renal Disease, you may have the right to buy certain Medicare Supplement policies that are sold to people under age 65.

Question: Does the Medicare Supplement Insurance company pay my doctor directly?

Answer: The insurance company will pay your doctor or provider directly when:

  • Your doctor or supplier has signed an agreement with Medicare to accept assignment of all Medicare claims for all people with Medicare;
  • Your policy is a Medicare Supplement policy; and
  • You tell your doctor’s office to put on the Medicare claim form that you want Medicare insurance benefits paid to the doctor or supplier. Your doctor will put your Medicare Supplement policy number and company on the Medicare claim form. You will need to sign the claim form.

When these conditions are met, the Medicare Carrier will process the claim and send it to the Medicare Supplement Insurance company. You Medicare Supplement Insurance company will pay your doctor or provider directly and then send you a notice. If you don’t get this notice, you may ask your insurance company for it.

In most cases, Medicare claims are sent directly to the insurance company, even if the doctor does not accept participation agreement.

Question: What happens if the Medicare Supplement Insurance company does not pay my doctor directly?

Answer: If the Medicare Supplement Insurance company does not pay your doctor directly (when the above 3 conditions are met), you should report this to your State Insurance Department.

Question: Can I pay on my own for services that are not covered by Medicare?

Answer: Yes, you may choose to pay on your own for services the original Medicare plan doesn’t cover. You are always free to get non-Medicare-covered services on your own if you choose to pay for the service yourself.

Question: Can my Medicare Supplement Insurance company drop me?

Answer: In most cases, no. Medicare policies sold after 1990 are required to be guaranteed renewable. This means that your insurance company must let you renew your Medicare policy unless you do not pay the premiums, you lie, or commit fraud under the policy. There is only one situation where you may lose a Medicare guaranteed renewable policy: if the insurance company goes bankrupt.

In addition, insurance companies may refuse to renew older Medicare Supplement policies that were sold as guaranteed renewable. To do this, an insurance company must decide to cancel all policies of this type sold in your state.

Question: Do I have to switch my older Medicare Supplement policy for one of the newer standardized Medicare Supplement plans?

Answer: No, you do not have to switch your policy.

Question: If I decide to switch my Medicare Supplement policy, and then I change my mind, can I go back to my older Medicare Supplement policy?

Answer: No. If you do switch Medicare Supplement policies, you will not be able to go back to your Medicare Supplement policy if it was sold to you before 1990.

Question: Do I have to have my Medicare Supplement policy for a certain length of time before I can switch to a different Medicare Supplement policy?

Answer: No. However, if had a Medicare Supplement policy for at least 6 months and you decide to switch, your second Medicare Supplement policy generally must cover you for all pre-existing conditions. If you had a Medicare Supplement policy for less than 6 months, the new policy must give you credit for the time you were covered under the older policy. If there is a benefit in the second Medicare Supplement policy that was not in your first policy, the company can make you wait up to 6 months before covering that benefit.

Question: Do I need more than one Medicare Supplement policy?

Answer: No. It is illegal for insurance companies to sell you a second policy. If you already have a Medicare Supplement policy and you want to buy another one, you must sign a statement saying that you plan to cancel your first Medicare Supplement policy. Do not cancel your first policy until the second one is in place, the pre-existing condition waiting period is over, and you decide to keep the second Medicare Supplement policy. You have 30 days to decide if you want to keep the new policy. This is called your free look period.

Important Note:

If you have further questions relating to Medicare Supplement policies, please refer to your 2000 Medicare Supplement Buyer's Guide.

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Medicare Friendly Income Products

What is an annuity?

Annuity … from the medieval Latin “Annuitas,” meaning “yearly payment.” An annuity is an agreement between an individual and an insurance company. An individual pays some amount of money (referred to as a “premium”) to an insurance company, which the company later pays back under an agreed-to payment schedule.

One method of receiving income might be a lump sum payment; another might be a guaranteed income to last at least as long as the annuitant lives. Most annuities have a deferral period (the period prior to the time income payments begin). During this deferral period the interest earned on the annuity is free from income tax until withdrawn.

How does an annuity help provide financial security in retirement?

Just a heartbeat ago, the average worker could not expect to live more than a few years past age 65, the normal retirement age. Now any healthy person may reasonably expect to live into his or her late seventies or eighties. Many people still face an uncertain financial future when their regular stream of income stops. Purchasing an annuity to guarantee a regular retirement income can be a highly satisfactory solution.

Single Premium Immediate Annuity Products

Standard Life of Indiana offers two great Single Premium Immediate Annuities: SPIA™ and SPIA+™.

Single Premium Immediate Annuities (SPIA) are purchased with a single lump sum investment of funds. The source of the funds might be life insurance proceeds, an inheritance, a one-time sale of assets, the sale of a business, a distribution from another annuity, or a distribution from a retirement plan. Income generally begins under an SPIA one payment period after the single premium has been paid and the annuity is issued. Income may be deferred under an SPIA, but if it is, the contract usually cannot be surrendered for its cash value, as is possible with deferred annuities.

SPIA’s may generally be purchased to pay income on a monthly, quarterly, semi-annual or annual basis. This means that the first income payment will generally occur one month, three months, six months, or one year after issue.


With the Select Annuity, the client has the satisfaction of knowing they are earning the highest possible yield, consistent with safety. The initial interest rate is guaranteed for a period as stated on the specifications page of the contract. On each anniversary your client will receive a complete accounting detailing their contributions and their account value.

The Select Annuity has tax-deferred income for the rest of your client's life, you can only get this from Standard Life!

Saver’s 5, 6, 7, 8, 9, or 10™

A traditional fixed annuity with a fixed year term -- plus a bailout provision. If your renewal rate falls below the safety withdrawal rate (bailout), you may withdraw your entire account value penalty free

Value Plus™

Traditional annuities offer tax-deferred accumulations and tax-favored income for the rest of the policyholder’s life. Traditional annuities bring the satisfaction of earning the highest possible interest rate – consistent with safety.

Value Plus™: The first tax-deferred annuity to offer a re-entry provision. The re-entry provision allows clients, at the end of the fifth year, and every four years thereafter to "re-enter", or start all over, with current first year bonus and base rates. In addition, the ValuePlus annuity offers both regular and Medicaid-friendly annuitization options at the end of the first contact year.

Guaranteed Five: Overview

Since 1934, Standard Life has been serving people just like your clients all over America. And we're proud to say that our annuity programs are some of the finest you'll find.

With the Guaranteed Rate Annuity, you'll have the satisfaction of knowing that the client is earning the highest possible yield, consistent with safety, on 100% of your initial contributions. Your yield will be guaranteed for the period specified on the contract.

This product is a single premium, tax deferred annuity with a long term interest guarantee and market value adjustment

Equity Income Plus: Overview


The Equity Income™ Plus Annuity is a traditional tax-deferred annuity that will offer you stock market-linked returns with none of the losses...and a 10% annuitization bonus.

At the end of each month after the annuity is issued, and with each subsequent payment, we record the value of the Standard & Poor’s® 500 Index. On each one-year anniversary of the policyholder’s Equity Income™ Plus payment, we compare the average of the 12 monthly values to the value of the S&P 500 Index at the beginning of the payment year. Then the percentage of change is multiplied by the participation rate in effect for the annuity. The resulting percentage rate is the annual interest rate applied to the value of the annuity for the year.

Remember, the Equity Income™ Plus Annuity averages its return over the course of a policy year. In a volatile market, averaging may tend to produce higher index increases if the index has risen and fallen substantially between measuring points. This, along with strong guarantees (114% if held for the full 10-year term, assuming no withdrawals), and a guaranteed participation rate make the Equity Income™ Plus the product of choice for many financial planners.

For individuals desiring a lifetime income, the Equity Income™ Plus will credit them with a 10% annuitization bonus (based on their initial deposit).

The Equity Income™ Plus Annuity credits interest once a year at a guaranteed rate of 100% of that year’s growth in the monthly average of the Standard & Poor’s® 500 Index, less an index adjustment and subject to a maximum rate stated in the contract.

If the S&P 500 Index declines in any given year, the principal and all previous gains are locked in, as along as no withdrawals have been taken.

"A tremendous product to compliment other retirement income."

What are you really earning?

When it comes to interest rates, do you calculate the effects of income taxes?

Taxable investments, like Certificates of Deposit, post their current interest rates without the effect of income taxes.

After - Tax Yields can be significantly less than advertised.

Tax-deferred vehicles, like Annuities, are credited with 100% of their yield because you don't have to pay income tax on annuities until you withdraw the money.

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