New Health Insurance Change for Retired Caterpillar Union Workers: Here Are Your Options
If you’re a retired Caterpillar Union Worker (since 2005), you’ve gotten a letter in the mail about your health insurance changing. It’s titled “Changes to your Caterpillar retiree healthcare benefits eligibility.” In the letter, it states that we have until October 6, 2017 to make a decision.
It can be confusing, and your options might be a little fuzzy. We’ve read the fine print and want to help you make the best financial decision you can.
Here’s what’s happening: you’re going to receive a yearly reimbursement of $3,000 for yourself and $3,000 for your spouse. This allows you to choose your own health insurance. You will submit your claims and premiums to be reimbursed up to that $3,000 limit.
You have a list of eligible expenses that can reimbursed. This includes things like:
- Medicare Part B premiums,
- Medicare Supplement premiums,
- Medicare Part D drug plans,
There’s an agreement with a company called OneExchange – this company has what they call "advisors" in Texas. An advisor from that company will hold a phone call with you to sign you up for different insurances. These advisors tend to speak harshly of independent agents, because agents receive commissions on the sale, while they do not – they receive a salary. The advisors will say that agents only sell products that make the most commissions.
We do want to make it clear our agents always provide suggestions with your best interest in mind, no matter the commission. Also, while the advisors may not receive commissions themselves, someone in the company is, and we often find that the advisors are told to "push" certain products. We never push certain products over others, and we have over 50 carriers to price shop against.
You are not required to purchase all of your insurance through OneExchange. However, in order to be eligible for that $3,000 reimbursement, you must purchase at least one type of insurance through them.
Drawbacks to OneExchange
You might be thinking: why wouldn’t I purchase all my insurance through OneExchange?
There are 3 big drawbacks to relying on OneExchange for all of your insurance needs.
- It’s often more expensive.
- You aren’t assigned a personal agent.
- Any relationship you have with the company will be long-distance.
Besides the obvious draw of saving money, it’s frustrating to work with multiple people, especially when they’re so far away. An ideal situation would be a single point of contact that knows and understands your history.
Another big benefit of saving money is that any money left in your reimbursement account will roll over to the next year. If any major health issues come up, you’ll be glad that extra money has piled up!
Our recommendation is to get your Medicare Part D drug plan through OneExchange to fulfill the requirement, and choose the rest of your insurance through a local agent that has plenty of different carriers to choose from.
This gives you an opportunity to price shop and save a ton of money while forming a relationship with someone who’s just a few miles away.
An example of this is a client we recently helped who was paying $190/month for a Medicare Supplement through OneExchange.
When we did comparisons, we were able to offer a plan that was $142/month. That’s a cost savings of about $576/year.
We want to help you save money while offering a face-to-face interaction with a local agent who can give you some clarification.
Also know that we’ve been helping the other CAT retirees with this since 2010, and now that it’s applying to you, we’d love to be your trusted source of information.