Attention Email Subscribers – and Others Too
Those Amazing Elders

Don't Trust What They Tell You

About a hundred years ago when Crabby Old Lady was a young woman – girl, actually, no more than a teenager – first living on her own, she overspent on her first credit card. The debt was so large that for the better part of a year, young Crabby lived on cottage cheese and crackers and gave up everything that was not essential until the bill was paid off.

Even though she told no one about her trouble, Crabby was deeply embarrassed at her stupidity. In fact, you are the first people who know of this.

That period was so painful, both financially and emotionally, Crabby swore never to allow it to happen again. Since then, she has used credit cards only as a convenience and except for a few emergencies through the years (when credit saved her ass), she has never owed more than she can pay in full each month. Her credit rating is so good that when she needed a short-term bridge loan three years ago to cover the time gap between purchasing a home here in Maine and the closing on her apartment in New York, the banker said, “You have an awesome credit score, Crabby.”

It doesn't take much these days to harm a credit rating, and it's not like Crabby has a rich family or a sugar daddy to call on when things go wrong or there is an emergency. So she guards that score closely. With it, she knows when there is need, as with the bridge loan, she can get the money easily and quickly.

When Crabby switched to a new Medicare Part D (prescription drug) provider in December, she elected to have the premium deducted from her Social Security benefit which is deposited electronically to her bank account each month. On Wednesday, when the January deposit was made, there was no deduction. Crabby Old Lady's personal financial alarm bell went ding, ding, ding.

When she explained her concern to the provider's customer service representative, she told Crabby that it would take up to four months (!) for Medicare and, separately, Social Security to approve the premium deduction. And meanwhile? Crabby asked. Would the provider, having received no payment, cancel her coverage and report nonpayment to the credit agencies?

To forestall that, the representative said, it would be necessary for Crabby to pay the insurance company herself until the deductions begin.

More alarm bells went off. In a flash, the following went through Crabby's mind:

  • She was not told, when she enrolled in the Part D program, that she would be required to make the payments by check for several months.

  • Because Crabby opted for the deduction, she did not receive premium coupons.

  • She doesn't trust the provider to give her the correct mailing address for the premium payment and it could easily be routed to the wrong place. The provider might cancel her coverage for non-payment.

  • Even with correct payment, it was likely, four months hence, that Social Security would deduct premiums for all of the four months.

  • It would take months, if not years, of hassle to get either Social Security or the insurance company to return the double payments.

  • Crabby's pristine credit score could be trashed.

When she expressed all this, the representative told her she works for a third-party service and could help Crabby no further. Crabby waited the standard 15 minutes after she was transferred to the insurance company.

New representative, same questions, different answers: It takes only two months for approval from Social Security and Medicare. No, she should not make payments herself. Her coverage “should” not be canceled during the wait for approval.

“Should” not be canceled? Is that certain? Crabby asked.

Probably reading from a script, the representative again said, “Your coverage should not be canceled.”

“Find me a supervisor,” said Crabby.

Standard 15-minute wait.

New representative, same questions, some different answers: It takes 90 days for approval from Social Security and Medicare. Do not make payments. Coverage will not be canceled and non-payment will not be reported to credit agencies.

Which of all these answers, Crabby wonders, is correct?

Taking Murphy's Law into consideration, Crabby made careful notes of these three conversations so she will have the (conflicting) information if trouble ensues. And there would be trouble for sure if Crabby had listened to the first representative and mailed payments - the first of which, this month, is already overdue and would be subject to a late fee.

You might think, as does Crabby, that this is an old story – screw ups from large companies that are liable to cost you money and if not that, certainly waste time. (In Crabby's case, she used up about an hour of her monthly cell phone minutes allotment.) But it becomes more serious when it concerns the health of old people.

Sometimes third-parties – spouses, adult children, friends, etc. - handle personal business matters for elders. Some elders have cognitive difficulties. Some may not have a firm grasp of English. In any of these circumstances, misunderstandings are bound to happen and undoubtedly some number of people lose coverage along with their prescriptions, incur additional costs or spend months sorting out problems only because the company is not clear about its policies.

All it would have taken to prevent confusion, Crabby's irritation and lost time was a short paragraph in the insurance provider's form letter of acceptance explaining the delay in the premium deduction and how it should be handled. That three representatives each had different answers is unacceptable. Isn't there a minimum standard of competence to be expected?

Certain members of Congress, teaparty members and assorted anti-government types have warned, during the debate on health care reform, that government-run health care would be rife with bureaucratic red tape. Crabby understands this is anecdotal evidence but in every dealing she has had with Medicare and Social Security representatives, the issues have been thoroughly and completely explained and nothing has ever gone wrong. The kind of minor mess Crabby experienced yesterday (and worse sometimes) is common with every private insurance provider she has dealt with.

Some old-time movie fun - Ruby Keeler and Lee Dixon dancing to Too Marvelous For Words from the 1937 film, Ready, Willing and Able. The chorus line keys are sensational.

At The Elder Storytelling Place today, Shirley Karnes: Trees in December


I love this post. I received a 32-page 8 X 11-inch "user's guide" in the mail, presumably to answer (too late) your question and the rest of life with this insurer. The guide is unreadable, replete with If/then statements followed by go to page X, seemingly written by monkeys at a keyboard who have no idea of a real person seeking information in the guide. Wasted trees, ink, postage, resources (human, material), and no help. A paperweight that is a paper weight. Years ago, when I worked in document design (Janice Redish is the guru:, I understood that when consumers in CT won in a case against an insurer, the industry suddenly hired knowledgeable folks to manage their communications, even statements. Hmmm. What happened?

My first comment is that the confusion caused by having Medicare and a private insurance company both involved in the Part D program is bad enough, but when we add a 3rd party to the transaction, Social Security, we are just asking for trouble. I would always recommend being billed by the plan provider, NOT using the Social Security withhold for Part D premiums. There are too many ways there can be errors, the 2-month delay for changes, and you have no control over the payment, as you just discovered. (This is not true with original Medicare B and Social Security, because there is no 3rd party involved, but it still takes two months for any changes to be made.)

My own opinion is that Part D should be set up and administered like Part B, but that's not going to happen - too much control by drug companies and insurance companies in Congress and the Administration to do that.

There are SHIP counselors in every state who are available to help people navigate these type of issues - the main contact numbers are on the Medicare site. The quality of the counseling depends on the state, I think, but for the most part it can be very helpful.

Insurance companies have been penalized by Medicare in the past if their customer service and procedures are not adequate. It takes enough people complaining to Medicare and to their Congress people to make this happen, but it has been done.

Sigh !!! Just another example of how much simpler life would be for everyone if Obama and Congress had simply passed Medicare for all and eliminated the insurance industry. But, oh no, the tea party mentality is afraid to give big government more power. Since government has been doing an excellent job with Medicare and Social Security I can't understand their obstructionist thinking.

Ruby Keeler; I have not thought of her for years, but she was fantastic. What a 'hoofer'. Thanks for posting this.

Amen to your post! Dealing with Medicare and Social Security has always been simple and easy. I remember that I had a very pleasant telephone interview when initially setting up my SS benefits. Imagine being happy after a phone call with a health insurance provider. You can't.

Why is that? Could it be the pay that insurance companies offer to their account reps? Do you think it might be less than a federal wage? Yes, you do get what you pay for...

Ronni - Bear in mind I'm not up to date on this stuff, but when I was in banking 20 years ago, I learned that medical and utility payments don't affect your credit score (unless you end up wiht a lien). I just had a medical bill go to a collection agency--I'd been told not to pay it, and a year later I started getting collection agency calls. I'll check my credit report & get back to you.

Tell Crabby not to get herself into too much of a tizzy over this. The exact same thing happened to us last year and--sure enough--everything caught up to where they were supposed to be in about 60 days. We were told not to pay anything, but that the deductions would come from SS. The insurance company (BC/BS) and Medicare would take their fee out in one lump to pay themselves back for two months, and they did. That meant there was a double deduction one month, then it reverted back to normal. Again, this year we switched insurance companies and were told the same. I'm not worried about it. Hang in there, Crabby.

Not to worry about Crabby Old Lady; she is capable of handling this sort of problem. However, she does not dismiss it and assume everything will correct itself.

Her major point - which she did not make clear - is not how this little incident will turn out, but how badly corporate insurance treats its paying customers, particularly compared to government-run coverage like Medicare.

Right you are Crabby Old Lady! I'm not the smartest person, but smart enough to never assume anything...experience being the best teacher!

I'm an insurance agent working with Medicare Supplements, Medicare Advantage and Part D - and I agree with you that Part D being handed over to insurance companies was a bad deal for Medicare and for seniors.

Insurance companies tell reps to discourage people from choosing the social security deduction option because of the lag time in setting up payments. And people need to think about what happens on the other end if they want to change plans. How long will it take to stop the deduction through social security? Best route is to get a coupon book and set up automatic payments through your checking account. Then you are in control. If you're not comfortable with computers you can ask a nice employee at your bank to help you set this up.

A wonderful post, Crabby!

One of its underlying messages: Pay attention to the bills you don't get.

Decades ago, when I moved into my first NYC apartment, I notified Con Edison that I was now the tenant. They sent me the first month's bill, and I paid it. And that was the last bill I got from them for three years, although my supply of electricity never wavered.

Then one day, I got a fat envelope that contained three years worth of Con Ed bills. The envelope was very heavy. (Con Ed bills used to be stiff, rectangular pieces of card-board.) And they hadn't even enclosed a cover letter, which somehow added insult to injury.

Of course, far from being intimidated, as a young Baby Boomer I welcomed a fight with Con Ed. (In those days, being a Baby Boomer was synonymous with being young and anti-establishment...)

I did a little research, and quickly learned that New York State had a Public Service Commission whose job was to police the public utilities. I telephoned their consumer hot-line and managed to reach someone in their legal department, who told me to write them a letter and copy Con Ed. (He also told me where to send the Con Ed copy.)

I enclosed a copy of the canceled check I had sent Con Ed in payment of the first bill, three years earlier, as proof that they knew I was responsible for the bills.

I argued that I had fulfilled my responsibility by notifying them as soon as I moved into the apartment and paying the first bill. It was their fault, not mine, that they had taken three years to bill me -- and therefore I felt I should be given three years to pay the outstanding bill.

The Public Service Commission agreed with me. With their help, over the next few weeks I negotiated a written agreement with Con Ed to pay them over the next 36 months; interest-free, of course. (Needless to say, I paid the current bill every month -- Con Ed was very punctual about billing me thereafter.)

From then on, I always paid attention to whether or not a bill had arrived when expected. It was a valuable experience in other ways, too. It confirmed my idealistic belief in the importance of standing up for one's rights in day to day matters. It also drove home how lucky I was: If I hadn't known how to do the necessary research, how to speak fluent English, and how to write a business letter, that huge Con Ed bill could have done me long-lasting financial harm.

Your article was helpful to us as we had just gotten a payment booklet in the mail for the supplemental that we had been carrying but switched to an AARP version in November. It was supposed to come out of our SS check as it had for the last year, but now we have no idea what happened. We have three places we have to deal with-- our previous provider, Medicare and Social Security to see if the money is being taken out as well as billed. Boy they make this confusing!

When I signed up for Social Security/Medicare some three years ago it was November 1st. I was told I would get my first social security check the latter part of December on my alloted date.

Meanwhile I had signed up for Part-D and the insurance rep told me their preferred payment method was the infamous "social security deduction". Although I would have personally preferred a deduction from my checking account so I would have more control, I did as they wished.

What a fiasco it turned out to be! It apparently took 2-months for the social security administration to get the deduction set up. Meanwhile, the first of the year had rolled around and the insurance company had increased their rates. I had already had the prior rate deducted in January and February. When they notified the social security administration of the new rate, social security came back in and deducted the new higher rate for the same months they had already deducted the previous rate rather than just the difference.

It took almost four months to get it straight. Meanwhile, the insurance rep was no where to be found. As far as I am concerned, giving a private insurance company access to your social security is like giving someone your credit card number and allowing them to deduct whenever....for whatever!

You're a smart lady! First in not letting your monthly credit exceed what you can pay off in full the next month, and 2nd, in keeping records of those phone calls, who said what and when. I hope you won't need those, but I don't hold those hopes up very high. Like you pointed out, better to be safe than sorry.

I can't understand all the worry - after all we know insurance companies are soooo much better than government at administration!

Irony aside, I never understand those who dismiss any activity by government on the basic grounds that the private sector does it best. We all have horror stories of appalling customer service. It isn't public/private that makes a difference it is size.

I have no greater faith in large corporate companies than I have in big government.

This makes interesting reading

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