1sttime to Medicare? Things to remember

by | Oct 1, 2018 | Home Health Care, Long Term Care insurance, Medicare Advantage Plans/Medicare Part C, Medicare Part A, Medicare Part B, Medicare Part D, Medicare Prescription Drug plans, Medigap/Medicare supplement

1sttime to Medicare? Things to remember

  • Don’t get overwhelmed: We talk with people daily that are just absolutely overwhelmed about the idea and options for Medicare.  Don’t be! Realize this, there are 4 aspects to Medicare you need concern yourself with: 1) Medicare A (Hospital portion of Medicare) and Part B (Medical/Doctor Portion of Medicare); 2) Medicare Advantage Plans (often include prescription coverage); 3) Medicare Supplements aka MediGap which SUPPLEMENT or Fill in the GAPS of what Medicare doesn’t pay. 4) Prescription Drug Plans (often called PART D plans).  These are mandated by the Federal Government and sold by private insurance companies.  They are often sold in conjunction with a Medicare Supplement or for those that just want to have Medicare Part A and B.
  • How do I choose between a Medicare Advantage or Medicare Supplement? Medicare Advantage work basically like the insurance you had under 65.  They have in networks and out of network deductibles. The caveat:  You are only network in the county in which you live. Medicare Advantage generally work better in large Metropolitan areas that have strong networks and conversely, the coverage in smaller communities or rural areas are far more limiting.  In Sum, the real advantage or appeal to Medicare Advantage is the $0 to low cost premium.  The disadvantage is often limited areas of coverage and insurance companies can dictate what is covered and what is not.  Conversely, Medicare Supplement plans go wherever Medicare goes. The only question you need to ask is , “Does Medicare pay?”.  If Medicare pays, the supplement plans pay regardless!!!  Premiums for a 65 year old female are generally between $85-95 in North Carolina.  Other states are comparable in price with the exception of FL and CA.  Finally, the time period often referred to as “Open Enrollment” between October and December is ACTUALLY the annual coordinated election period (AEP).  At this time you can make changes to your Medicare Advantage plans or Prescription Drugs plans (discussed in next bullet).  You can change Supplements at any time (Medicare is your primary, the Medicare Supplement is your secondary hence you are not locked in to the AEP period)
  • Prescription Drug plans where an entitlement program enacted by George W Bush that provided drug coverage to Medicare recipients. Enrollment (if you are outside your initial election period is during AEP for the following calendar year).  Drug company formularies are updated annually therefore, one should review every year at AEP to look at options.

Above was just what you NEED to know to understand the basics.  The below is more detail…

SOME EXAMPLES

  • Medicare –
    1. Go to any health care provider that accepts Medicare
    2. People are responsible for
    3. Part A
      1. $1316 deductible in 2017 for hospital stays up to 60 days
      2. Additional costs after 60 days
  • Different costs for other Part A services
  1. Part B
    1. $183 annual deductible in 2017
    2. 20% coinsurance or copayment for most Part B services
  • Some programs may help with costs

 

Medicare Part A Additional info

  • Most people receive Part A premium free
  • Skilled Nursing Facility: 1st20 days covered at 100%,  21-100 days: Everything in Excess of $164.50/Day
  • People with less than 10 years of Medicare- covered employment
    • Can still get Part A
      • Will pay a premium
    • For information about Part A entitlement
      • Call SSA
        • 1-800-772-1213
        • TTY users call 1-800-325-0778

 

Medicare Part B Additional Info

  • Pay monthly Part B premium
    • $134 in 2017 (Average) –Initial Enrollment Period (IEP)
    • 7 months starting 3 months before month of eligibility
  • Some people can delay enrolling in Part B with no penalty
    • If covered under employer or union group health plan
      • Based on current employment
        • Person or spouse
      • Will get a Special Enrollment Period (SEP)
        • Sign up within 8 months after coverage ends

 

Part B Enrollment Periods EXAMPLE

  • Marie turned 65 on June 25, 2017. She will have group health coverage from her employer until she stops working on December 31, 2017.
  • Part B enrollment opportunities …

 

Enrollment Period Begins Ends
IEP 3/1/17 9/30/17
SEP 12/1/17 8/1/18

 

 

Paying Part B Premium

  • Taken out of monthly payments
    • Social Security
    • Railroad retirement
    • Federal government retirement
  • For information about premiums
    • Call SSA, RRB, or Office of Personnel Management
  • If no monthly payments
    • Billed every 3 months
    • Medicare Easy Pay

PART B Late Enrollment Penalty

  • 10% for each 12 month period eligible but not enrolled
  • Paid for as long as the person has Part B
  • Limited exceptions

Medicare Advantage Plans Additional Info

  • Health Maintenance Organization (HMO) Plans
    • Some have Point-of-Service option
  • Preferred Provider Organization (PPO) Plans
    • Regional PPOs new in 2006
  • Private Fee-for-Service (PFFS) Plans
  • Special Needs Plans
  • Health Maintenance Organizations (HMO) Plans— Members must generally get health care from providers in the plan’s network. Some HMO Plans offer a Point-of-Service option, where members can go to doctors and hospitals that aren’t part of the plan, but it may cost more.
  • Preferred Provider Organization (PPO) Plans—similar to an HMO plan but members can see any doctor or provider that accepts Medicare and don’t need a referral to see a specialist. Going to a provider that isn’t part of the plan will usually cost more.
  • Private Fee-for-Service Plans—Members can go to any provider that accepts the plan’s terms, and they may get extra benefits. The private company decides how much it will pay and how much members pay for services.
  • Special Needs Plans—limit all or most of their membership to people in some long-term care facilities (like a nursing home); who are eligible for both Medicare and Medicaid; or who have certain chronic or disabling conditions. Special Needs Plans are available in limited areas.
  • Medicare Medical Savings Account Plans—have two parts. One part is a Medicare Advantage Plan with a high deductible, and one part is a Medical Savings Account into which Medicare deposits money that people can use to pay health care costs.

Eligibility for Medicare Advantage

  • Live in plan’s service area
  • Entitled to Medicare Part A
  • Enrolled in Medicare Part B
    • Continue to pay Part B premium
    • May also pay monthly premium to plan
  • Don’t have End Stage Renal Disease (ESRD) at enrollment
    • Some exceptions

How a Medicare Advantage Plan Works

  • Usually get all Part A and B services through plan
    • May have to use providers in plan’s network
    • Must still pay Part B premium
  • May get extra benefits
    • Vision, hearing, dental services
    • Prescription drug coverage
  • Still in Medicare program
    • Have Medicare rights and protections

Medigap/Medicare Supplement

  • Health insurance policy
    • Sold by private insurance companies
    • Must say “Medicare Supplement Insurance”
    • Covers “gaps” in the Original Medicare Plan
      • Deductibles, coinsurance, copayments
      • Does not work with Medicare Advantage Plans
    • Up to 12 standardized plans A – L
      • Except in Massachusetts, Minnesota, Wisconsin
      • So people can compare easily
    • How it works:
      • People can buy a Medigap policy
      • Within 6 months of enrolling in Part B
      • Must be age 65 or older
      • If they lose certain kinds of health coverage
      • Through no fault of their own
      • If they leave MA Plan under certain circumstances
      • Monthly premium
      • Go to any doctor or specialist that accepts Medicare
      • ALL PLANS ARE STANDERDIZED AND PAY THE EXACT SAME FROM CARRIER TO CARRIER

Part D Prescription Drug Info

  • Initial Enrollment Period (IEP)
    • 7 months
    • Starts 3 months before month of eligibility
  • Annual Coordinated Election Period (AEP)
    • October 15 through December 7 each year
    • Can join, drop, or switch coverage
      • Effective January 1 of following year
    • Generally there are three types of enrollment periods when people can sign up for Medicare prescription drug coverage.
    • TheInitial Enrollment Periodis for 7 months starting 3 months before the month people become entitled to Medicare.
    • TheAnnual Coordinated Election Periodis from October 15 – December 31 each year. During this period, a person who is not enrolled in a Medicare drug plan can choose to enroll. A person who is in a Medicare drug plan can choose to drop or switch plans at that time. The change in enrollment or in plan selection will be effective January 1 of the following year.
    • There are many special circumstances that give a person a Special Enrollment Period, such as a permanent move out of the plan’s service area, or moving to or from a long-term care facility. The time period varies according to the reason for the Special Enrollment Period.
    • Some people with Medicare have a continuous Special Enrollment Period, meaning they can enroll in or switch plans each month. This is true for people who qualify for extra help with their drug plan costs and those who live in an institution, like a nursing home. (Starting in June 2007, all people who qualify for the extra help have this continuous Special Enrollment Period. Previously this was only true for some people with the extra help.) We will talk about this extra help in a few minutes.

Part D Late Enrollment Penalties

  • People who wait to enroll may pay penalty
  • Medicare calculates the penalty by multiplying 1% of the “national base beneficiary premium” ($35.63 in 2017) times the number of full, uncovered months you didn’t have Part D or creditable coverage. The monthly premium is rounded to the nearest $.10 and added to your monthly Part D premium.