Episode 19 – How SHIBA helps with Medicare questions
Episode transcript:
[musical intro]
Jenny
Welcome back to Fund Your Future with DRS and on the podcast we certainly love to talk about preparing for retirement and some of the most common questions around retirement that we get are usually related to understanding Medicare. But luckily, Washington state has a great program that provides a free, unbiased help to guide you through the process.
Seth
Yeah, I actually got stopped in the hallway in our office. An employee who’s very close to retiring said “We got to do an episode about Medicare.” And Jenny and I knew that we were not the experts to talk about that. But fortunately, as you said, Washington has a program called the SHIBA program. And we have Tim here.
And the SHIBA program is in the Office of the Insurance Commissioner for the state of Washington. And so, the SHIBA program stands for: the Statewide Health Insurance Benefits Advisors program. So, Tim, could you just tell our listeners a little bit about what the SHIBA program is and what your role is there?
Tim
Sure, happy to. And Jenny and Seth, thank you for having us today. So, the SHIBA program is one of 54 programs across the country and territories. We have the distinction of being the first program in the country, the SHIBA program was actually started by a group of volunteers in Stanwood Washington, 45 years next year, and they just had the idea as neighbors about helping other neighbors who had questions about Medicare insurance.
At some point then they approached the Office of Insurance Commissioner about sort of being adopted as a program of the Insurance Commissioner’s Office. And so we now are kind of going strong. Of course, a lot has changed in 45 years, especially in the world of Medicare. But, you know, we just have a lot of pride in the fact that it’s a public private partnership. But the real work is done at that neighbor-to-neighbor peer-to-peer counseling program.
Jenny
Yeah, that’s super cool. And obviously, insurance coverage in retirement is super complicated, which is why you have this program. Are there one or two things that folks who are looking to retire in the next couple of years should keep in mind when they’re looking at their health care options?
Tim
Yeah, for sure. Jenny, I think I think the first thing would be that there’s no kind of one size fits all solution. And, you know, Seth I were talking before the broadcast that people in kind of a good way and kind of a good-natured way they just assume that everybody has the same challenges and opportunities that they do.
But of course, that’s not the case. So, it really pays to just ask a lot of questions. So, I’d say maybe three things to focus on would be, first of all, use the resources of DRS. So, DRS is kind of in charge of your retirement benefit, which you know you’ve earned by your service to the state or other local government. That’s part of the DRS system. And so that really is about your retirement income. So, think about them as kind of experts about your retirement income.
The second would be: reach out to the state Health Care Authority. The Health Care Authority manages your benefits when you’re a working person, and they also manage your benefits in retirement. And so, in the way that DRS is in charge of your income, HCA is in charge of your health insurance or your health care. And so you want to really be thinking about the questions that you have for them. And, you know, we can obviously talk some more about that.
And then the third would be: that for a lot of people, retirement is coincidental with being enrolled in Medicare. And so please call the SHIBA program and ask a lot of questions about Medicare insurance.
A simple thing that we would tell people to do well ahead of time, right, because this is about being prepared for retirement is to create a secure online account for yourself at SocialSecurity.gov and Medicare.gov, and that will help you manage through these transitions.
Seth
I feel like it’s a really good point, in that, technology has come a long ways for folks and that there are a lot of resources online for setting up those accounts and thinking about doing them early, not waiting until the day you turn 65 or the day the day you have your retirement party to kick that off.
Tim
One thing that would be a common challenge is that Medicare age, still for most people, is age 65. But full retirement and Social Security now is 67 years old. So, we have more and more people who are eligible for Medicare, but they’re not actually drawing their Social Security benefit yet. So, they won’t be automatically enrolled into the Medicare program.
You have to take affirmative action to enroll yourself. So just to kind of make the point that not everyone is having the same opportunities or challenges that you are and just ask a lot of questions.
Jenny
And so maybe you could tell our listeners about your website and what are some of the tools, so…
Tim
Insurance.wa.gov — as Seth said, we work out of the Office of the Insurance Commissioner Mike Kreidler And so we do have a pretty robust website. You can do a lot of self-service right on the website. We also take a lot of pride in having a live answer 9 hours a day, five days a week, toll free number, so you can talk to a person in real time.
And we do also have online chat. You can chat with a real person compared to like a chat bot. And we also welcome walk in customers at our offices here in Tumwater. But most of the work of the program is actually done out in local communities by volunteer advisors. So you need not travel to Olympia or Tumwater. We can help you where you live at.
Jenny
That’s super. So obviously they could go onto the website, find a local place near them, or sign up within an appointment.
Tim
Yes, absolutely. So, as I said, most of the work of the program, Jenny, is done by local volunteers and local communities and we contract with not for profit agencies around and local area agencies on aging. And so, you can meet in a local community, you can pre-arrange an appointment. Of course, they all have their own website presence and website technology.
But sure, you could call or you could go online and say, “I’d like to get ready to retire, or I’m going to be turning 65 in a few months. And I would just like to have somebody help me navigate this system” and we’d be happy to arrange an appointment with you.
Jenny
That’s awesome. It’s an all-volunteer program as well.
Tim
It is. You know, that’s really very important to us. We feel like taking these conversations kind of out of the political economy makes a lot of sense. You know, we don’t feel like you should have to pay for advice about an entitlement, right? You’ve earned your Medicare benefit by virtue of your service, as with your retirement or your health care.
And so, you shouldn’t have to pay to get help with, you know, navigating that entitlement. The reality is that most people don’t ask for any help. There’s been lots of survey research about this. And most people, when they get to that place, simply just rely on their best judgment. I’m not exactly sure what that means or what that looks like, but it doesn’t always come out good.
And so, they typically turn into our customers kind of after the fact. You know, they blew through those early opportunities. But that happens. But for the people who do seek help, most of them seek out an agent or a broker, which is fine, and they’re obviously very well qualified. The Insurance Commissioner’s office license and regulates the insurance brokers and agents in the state.
But the reality is that they are typically not representing the full range of insurance companies or options, and that just because of the nature of their work, they’re less inclined to spend 30 or 40 or 50 minutes with you in an appointment just navigating something that’s not actually related to a sale the way that we are.
Jenny
Yeah. And so obviously this volunteer program, it’s excellent that this is offered for folks who have questions about their Medicare it like you said, as an unbiased opinion and can you tell us a little bit more about how those volunteers are trained so that they’re able to provide the correct information?
Tim
Yeah, absolutely. So, you know, I think that’s probably the principle thing that the professional staff of the SHIBA program contribute is training the volunteers. So it’s a combination of online self-paced coursework. We share with the other programs like ours around the country. And then we have instructor-led training we refer to as basic training. And then the third in the sequence that we call the path to certification is that then you do mentoring or peer coaching with an experienced volunteer, and then we certify you to make sure that in fact you’re ready to kind of fledge the nest and work independently.
So, front to back. You know, it depends a lot on what experiences the person brings to the work, but it’s typically about 12 or 18 months from kind of a motivated layperson to a proficient volunteer.
Jenny
Oh, wow, That’s really excellent.
Seth
It seems like that’s a great way for somebody to learn themselves about Medicare and health care options in retirement. Is that, “hey, maybe I’m 60 and I know I’m starting to approach retirement. Maybe I should think about the opportunity to volunteer with SHIBA. And then that’s also maybe something that I might do after retirement and, you know, stay involved in the community and build relationships.”
Tim
The three paths probably are exactly what you said. So the first one is: “I want to learn about this because I’m self-motivated. It’s going to serve me.”
Seth
The best way to learn something is to teach something. Yeah. In any subject, you get so many more insights because people are asking you questions that you maybe haven’t thought about. And so that’s it’s a great opportunity. A great way to learn about anything is to try to figure out how to teach it.
Tim
Absolutely. So, we get the people who are motivated because this is becoming a relevant issue or concern for them.
The second would be the folks who have been through the, you know, that sort of going over the falls in a barrel experience and they’re like, “Uh-oh, I don’t want this to be someone else’s experience. I feel like I could help out here.”
And then the third is what you said, and become like, “I need something meaningful to do in my retirement. I need some way to give back to the community.” We get lots of retired health care professionals. They were a doctor or nurse in their career, retired lawyers, retired HR professionals, retired teachers – because it kind of makes sense to them and they feel like they can kind of give back based on, you know, their career.
But we also get plenty of volunteers who come out of more blue-collar kind of experience. And they just have that sort of ethic about volunteerism and community service and giving back and also people for whom it’s a bit of advocacy. “No one should really struggle. This is something that to which you’re entitled, and I want to help open people’s eyes to all of their options so that they don’t feel like they’re being conscripted into Medicare.”
Jenny
That’s super great. So, Tim, are there common mistakes or things that people overlook when considering their health care insurance options? Obviously, there’s a lot to consider, but what are some of the themes that you see in your line of work?
Tim
Wow, that’s a great question. I mean, there definitely are those kinds of themes. I would say the most common experiences that people are just sort of startled by how different retirement is than working. And you’ve probably just experienced that generally at DRS – right? That adjustment to retirement is such a big deal. And health care in retirement is so different, right?
I mean, I think that when we’re working, we you know, we’re generally well and that doesn’t always persist into retirement. And so, it’s the first time for a lot of people experiencing needing to go to the doctor and needing to use their insurance and so they haven’t really been… open enrollment just comes and goes and they’re really not paying attention.
But then, you start needing to use your benefit and now, kind of the scales are off your eyes and you’re reading your certificate of coverage and you’re on the phone with customer service and you have different questions for your doctor’s office. And open enrollment really means something to you now because you want to change plans. So, I think the first thing that people experience is that how much more expensive it is as a retiree compared to a working person.
Obviously, you know, when you’re working, the state is subsidizing your insurance to a huge extent, regardless, you know, which plan you choose. And the state continues to subsidize your coverage into retirement. But it’s a pretty substantial bill for your retiree health insurance coverage, and it does depend upon which one you pick. But they’re all relatively expensive. And the second thing is that it’s sort of surprises people that Medicare is not for free.
So back to our earlier conversation about sort of misinformation. People generally translate entitlement into it’s for free. Well, it’s not. So, you’re going to have a premium for your Medicare insurance as well as a premium for your health insurance from the state, from the Health Care Authority. And so that’s a bit of a challenge for people. And then in spite of having both of those insurances in spite of having a Uniform Medical Plan, or United Healthcare, or Primera Medicare supplement plan, or enrolling in Kaiser, even with that and Medicare, you still have out-of-pocket expenses. And so, navigating that reality is challenging for people.
Seth
You don’t know what your expenses are going to be when you’re retired because your life changes so much. And having that flexibility of having additional savings, whether it’s in DCP or a Health Savings Account. The retirement landscape and universes is big. DRS is just one piece of it. And trying to help people understand. When you were talking earlier, I don’t know if I’ve ever heard anyone talk about this before, but just understanding what the normal age is for each one of the different benefits you have could be a really just helpful exercise for somebody who’s thinking about you know, “I’m 60 years old and I know I’ve got these…” I don’t want to call them deadlines that are going to happen. But…”gates”… or…
Jenny
Maybe ‘milestones’. Yeah.
Seth
Yeah “milestones” of: “what things are coming up that I need to kind of have on the radar.” It’s something that you know, honestly we see DRS as well. People can retire at 65, but they have Social Security stuck in their head. And so they’re thinking 67. And that’s a really good point with Medicare and Social Security and all of these different programs that don’t necessarily always line up.
Tim
Right? No, I think there is a lot of complexity. And so, you know, back to Jenny’s earlier question, I think it is just a lot about asking a lot of questions and because you won’t have enough insight into what those gates or milestones are. You know, use the customer service representatives from DRS or HCA or our office or Medicare. Before you hang up the phone, or you close out the chat say: “is there anything else I should have asked you or have you worked with anybody else like me recently that, you know, you had some helpful advice.” Because, you know, they don’t know what’s behind your situation and you don’t know enough to necessarily disclose it.
In our system and state government, more people now are choosing when they’re working to enroll into a high deductible health plan where the health savings account. Yeah, and that’s a terrific solution for lots of people. And, you know, you did the math and that works for you and you’ve got that sort of risk tolerance. Well, Medicare has rules about how you manage your contributions to HSA ahead of enrolling in Medicare.
And so that’s the thing that you want to check out with Medicare and IRS. Now, that only applies to a small number of people who are in these HSA plans, but for them, it’s a very big deal. Another example might be – it’s very different for people who have dependents on their coverage than for people who don’t. State employees, for example, who cover dependents who have disabilities…
And so, all of these kinds of personal circumstances affect your journey into Medicare, because Medicare literally is an individual policy. There’s no husband/wife policy for Medicare the way there is for [you] when you’re working. So you’ve got to think about “what’s the best thing for me and how does it affect my dependents as well.”
Seth
I like your description of disclosures. What are the things that you need to make sure to share with whoever you’re working with, whether that’s DRS, or an insurance broker or whoever you’re talking to about, even if you’re talking to your neighbor…like, what are the things that you need to make sure that you’re on the same page about?
Because everybody’s circumstances are different. Could you remind us what the website is if our listeners have more questions…a place to start, of where they should go?
Tim
Sure. For us, it is Insurance.wa.gov And then, you can look for Medicare or you can look for SHIBA.
Seth
SHIBA, but it’s S-H-I-B-A. So, if somebody’s just googling: “Washington state SHIBA” there’s an “I” in there that could cause some confusion and we want to make sure people are getting to the right resource.
Tim
Yeah, and I think you know, even if you’re not ready to step into being a SHIBA volunteer, I think, at least you can be helpful to a friend or a neighbor by encouraging them to ask for help. Don’t let them just kind of blindly navigate along the path. At least be a good friend and neighbor by saying, “How many people have you talked with? How many questions have you asked?” You know, “how many other places have you considered before you got to a decision?” You know, I think you can be a good neighbor in that way. But certainly, we are always recruiting for more people who want to be of service in the community and be SHIBA volunteers.
Jenny
That’s awesome. So, if somebody’s already been retired, they’re on Medicare. Can they still use this particular program to maybe re-assess their account?
Tim
That would be a really good idea because I think that what the data shows is that most people never even think about it, right? They’re enrolled in Medicare and they’re having a pretty good experience or they have some complaints, but they… it’s not worth kind of opening a can of worms. And so, they don’t. And so, what you see is that year after year, people just stay in the same place when in fact there’s lots of other options. But because it’s so fraught, they never even start the conversation.
Jenny
Yes. Yeah. So, I was going to… my parents are obviously on Medicare, but I was going to encourage my mom to go on to the website. And yeah, you know, especially as a non-tech person, I know that she would appreciate sitting down probably and having a 40-minute conversation with someone about her account.
Tim
Yes.
Jenny
If there was other options or like just all of those little things that she may not be considering.
Tim
Yes. Well, and I can tell you, this happens every year with my mom. She’ll be 84 in October. So hello. “Hello, Mom.” And every year she’ll call me up and she’ll say, “okay, I know I asked you this last year, but I need you to explain to me again why am I staying there? Because I’m paying….” Fill in the blank…“$100 a month for my insurance. But my friend that I go to water aerobics with, she has this plan that has zero premium and pays her gym membership.” And this is a very common question that we get from PEBB retirees or SEBB retirees because they have Kaiser and their neighbor has Kaiser. Well, it’s not the same. Yeah. And so that is very difficult for people.
And there’s this tension about, “why don’t I just quit PEBB and sign up with, you know, fill in the blank insurance company?” And the answer is not that you shouldn’t do it, but you should just be aware of the tradeoff. And the significant tradeoff is that if you leave the state system, you can’t come back again. So it’s not like open enrollment changing from one plan to another.
Leaving the state system has real consequences. The other part of that answer is that it’s not the same plan. It’s a better plan, it’s a richer plan. You’re getting more benefits and paying less out of pocket and you have more protections against, you know, really catastrophic costs than you do in a private market plan outside of your state retirement benefits.
So, as much as you resent the rate increases and the kind of, you know, nickel and diming on the benefits and the co-pays, it really is a better solution for most people. And so that’s how the conversation my mother always ends every year is that she elects to stay there and pay her own gym membership. And next year we do the conversation all over again.
Seth
It’s hard because insurance just is something that, you know, we shop for home insurance or car insurance, but like health insurance for most folks isn’t something that they very frequently have to go onto the marketplace and really evaluate. And your employer has already done a bunch of the vetting. Yes. And so, as an individual trying to decide between tens or hundreds of plans, I can imagine it would just be overwhelming.
And then inertia kicks in and just like “I’m going to stick with what I got because that’s the easiest thing.” A simple solution that…
Tim
That’s 100% right Seth. So as a for instance, if you were a person who was not enrolled in, you know, retiree coverage for instance. If you were buying insurance in the private market in this year, in 2023, there are about 50, five-zero, different Medicare prescription drug plans in King County. Right? So, it’s daunting. You can see why people hesitate before they say, “I wonder if there’s a better plan.”
Seth
Yeah, yeah, “That’s good enough. I’m good. I’m done. I’m just going to go play pickleball.” Yeah, that was my dad answering the question, I’m sure. Yeah.
Jenny
So, I have a clarifying question. The SHIBA program – is it only available to public employees or is it available to all Washington state residents?
Tim
Oh, thank you for asking. It’s available to anyone in the state. And we often also get out-of-state calls. Lots of Times younger people are calling on behalf of their parents or people are thinking of relocating here from Alaska or California or leaving the state. And they want to know about, you know, how portable are their benefits. And so, it is a free public service to anyone in Washington, whether the beneficiaries or just helpers of beneficiaries.
Jenny
Gotcha. That’s perfect. Yeah. Well, thank you. We really appreciate it. This is a very in-depth subject, obviously.
Tim
It is. Is it too much? Am I nerding out on you?
Seth
No, we just we just scratched the surface. And I think that’s kind of the point. With almost every conversation we have, we’re just trying to introduce topics and start conversations and realize we’re not the experts. Jenny and I certainly aren’t the experts on anything. So, just trying to let people know what resources are out there. And I think you certainly let people know that there are lots of great resources to start to talk about insurance options and start to have those discussions before somebody goes over the falls in the barrel. I think that’s a good, good picture to keep in mind.
Jenny
Thank you so much, Tim.
Tim
It’s my pleasure, Jenny. Seth, thank you for having us.
Seth
Yeah, thank you.
Jenny
Thank you.
[music outro]
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