Medicare Explained (For the rest of us!) A plain English version

Transcription

1 Produced by & Not affiliated with any Government Agency

2 A Brief History of Medicare Medicare is a national social insurance program, administered by the U.S. federal government since 1965, that guarantees access to health insurance for Americans aged 65 and older who have worked and paid into the system, and younger people with disabilities as well as people with end stage renal disease and persons with amyotrophic lateral sclerosis. In 1965, under the leadership of President Johnson, Congress created Medicare under Title XVIII of the Social Security Act to provide health insurance to people age 65 and older, regardless of income or medical history. Before Medicare's creation, approximately 65% of those over 65 had health insurance, with coverage often unavailable or unaffordable to the rest, because older adults paid more than three times as much for health insurance as younger people. Medicare spurred the racial integration of thousands of waiting rooms, hospital floors, and physician practices by making payments to health care providers conditional on desegregation. Medicare, in operation for well over forty years, has undergone several changes. Since 1965, the provisions of Medicare have expanded to include benefits for speech, physical, and chiropractic therapy in 1972 Medicare added the option of payments to health maintenance organizations in the 1980s. Over the years, Congress expanded Medicare eligibility to younger people who have permanent disabilities and receive Social Security Disability Insurance (SSDI) payments and those who have end-stage renal disease (ESRD). The association with HMOs that began in the 1980s was formalized under President Clinton in In 2003, under President George W. Bush, a Medicare program for covering almost all drugs was passed (and went into effect in 2006). Medicare Eligibility If you meet one of the following criteria, then you are eligible to enroll in Medicare: U.S. citizen age 65 years old or older Permanent legal resident in the U.S. for five continuous years & 65 years or older If you are age 65 and currently receiving Social Security or Railroad Retirement Benefits, you are eligible for Medicare and you will be automatically enrolled in

3 Medicare Part A and Part B. However, because Part B has a premium, you have the option of declining Part B coverage. If you later choose to enroll in Part B and did not have creditable (at least as good as Medicare) coverage, there is the possibility of a late enrollment penalty. In addition, Part B does require payment of a monthly premium of $104.90, barring certain exceptions, for individuals enrolling in Part B January 1, 2013 or later. These premiums can change on an annual basis. Under certain circumstances, Part A can also have a premium. The occurrence of a Medicare Part A premium is fairly rare. If you are not currently receiving Social Security or Railroad Retirement benefits, you may visit your local Social Security office and request enrollment in Medicare Part A and Part B assuming you meet Medicare eligibility rules. Eligibility for Disabled There are a collection of chronic conditions and disabilities that qualify individuals for Medicare benefits. Medicare eligibility rules dictate that a person can enroll in Medicare before the age of 65 if one or more of the below criteria are met: You are a U.S. citizen or legal resident under 65 years old but have a qualifying disability (e.g. blindness) or a qualifying medical condition (e.g. Lou Gehrig's Disease) You have received disability benefits from Social Security or the Railroad Retirement Board for 24 months You are a disabled widow or widower between age 50 and age 65 but have not applied for disability benefits because you're already getting another kind of Social Security benefit You have permanent kidney failure (i.e. End Stage Kidney Disease) and you receive maintenance dialysis and/or have received a kidney transplant and you (or your spouse or parent if you are a dependent) meet certain work conditions What does Medicare cover? Medicare coverage is based on 3 main factors 1. Federal and state laws. 2. National coverage decisions made by Medicare about whether something is covered.

4 3. Local coverage decisions made by companies in each state that process claims for Medicare. These companies decide whether something is medically necessary and should be covered in their area. Medicare covers services (like lab tests, surgeries, and doctor visits) and supplies (like wheelchairs and walkers) considered medically necessary to treat a disease or condition. If you're in a Medicare Advantage Plan or other Medicare plan, you may have different rules, but your plan must give you at least the same coverage as Original Medicare. Some services may only be covered in certain settings or for patients with certain conditions. In general, Part A covers: Hospital care Skilled nursing facility care Nursing home care (as long as custodial care isn't the only care you need) Hospice Home health services Part B covers 2 types of services Medically necessary services: Services or supplies that are needed to diagnose or treat your medical condition and that meet accepted standards of medical practice. Preventive services: Health care to prevent illness (like the flu) or detect it at an early stage, when treatment is most likely to work best. You pay nothing for most preventive services if you get the services from a health care provider who accepts assignment. Part B coverage includes: Clinical research Ambulance services Durable medical equipment (DME) Mental health Inpatient Outpatient Partial hospitalization Getting a second opinion before surgery Limited outpatient prescription drugs

5 Two ways to get drug coverage 1. Medicare Prescription Drug Plan (Part D). These plans (sometimes called "PDPs") add drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private Fee-for-Service (PFFS) Plans, and Medicare Medical Savings Account (MSA) Plans. These plans are only available through private insurance companies. 2. Medicare Advantage Plan (Part C) (like an HMO or PPO) or other Medicare health plan that offers Medicare prescription drug coverage. You get all of your Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) coverage, and prescription drug coverage (Part D), through these plans. Medicare Advantage Plans with prescription drug coverage are sometimes called MA-PDs. You must have Part A and Part B to join a Medicare Advantage Plan. So I have Medicare, Now what? Once you are enrolled in Medicare, you have some decisions to make. Is Original Medicare by itself enough coverage? The most common answer is no, for a variety of reasons: High per incident Deductible for Hospitalization Annual Deductible for Medical coverage then the responsibility for 20% of the bill No Maximum expense Medicare never covers at 100% No coverage for preventive Dental, Vision or Hearing No Drug coverage (only available through private insurance companies) So what are your options? Medicare Supplement Plans: Medicare Supplement Plans are designed to help fill the gaps in your Medicare Part A and B coverage. You are still in Medicare and can keep your same doctors, but with a supplement plan can you have more predictable costs for expenses such as deductibles and coinsurance. They have no Networks meaning you can see any physician or use any facility that accepts Medicare. Or Medicare Advantage Plans: designed much like traditional, employer-sponsored health insurance plans. These plans include all of your Medicare Part A (Hospital Insurance) and Part B (Medical Insurance) benefits, plus emergency and urgent care. Medicare Advantage plans may also include Medicare Part D (Prescription Drug Coverage) and other additional coverage. Medicare Special Needs Plans (SNPs) are a

6 type of Medicare Advantage Plan that limits membership to people with specific chronic diseases and conditions or who have specialized needs. Let s look at these plans in a little more detail: Medicare Supplement Plans Medicare Supplement Insurance (also called a Medigap Policy ) is private health insurance that is designed to supplement Original Medicare. This means it helps pay some of the health care costs (or gaps ) that Original Medicare doesn t cover (like copayments, coinsurance, and deductibles). If you have Original Medicare and a Medigap policy, Medicare will pay its share of the Medicare-approved amounts for covered health care costs. Then your Medigap policy pays its share. Every Medicare Supplement policy must follow Federal and State laws designed to protect you, and the policy must be clearly identified as Medicare Supplement Insurance. Medicare Supplement policies are identified by letters A through N and are standardized. Each standardized Medicare Supplement policy must offer the same benefits, no matter which insurance company sells it. Plan F is Plan F. The plan premium is usually the only difference between policies with the same letter sold by different insurance companies. Some things Medicare Supplement policies don t cover vision and dental care hearing aids eye glasses private duty nursing Long Term Care When is the best time to buy a Medicare Supplement policy? The best time to buy a Medigap policy is during your Medicare Supplement Open Enrollment / Guaranteed Issue period. This period lasts for 6 months and begins on the first day of the month in which you re both, 65 or older and enrolled in Medicare Part B. What is SELECT C / F or High Deductible F? Medicare SELECT and High Deductible F are Modified Medicare Supplement policies sold in some states that requires you to pay a deductible first or use hospitals and, in some cases, doctors within its network to be eligible for full insurance benefits (except in an emergency). These policies generally cost less than other Medigap policies.

7 What does a Medicare Supplement plan look like? Medicare Advantage Plans Medicare Advantage health plans offer all of the benefits covered under Original Medicare and more. Many plans have NO additional premium beyond your Medicare Part "B" premium which you must pay. For plans with a monthly premium, rates are not based on age, gender or health condition. Also, most plans include Medicare Part D prescription drug coverage. Depending on where you live, you may have several Medicare Advantage plans to choose from. To enroll in a plan, you must be eligible for Medicare Part A and continue to pay your Medicare Part B premium, unless otherwise paid for under Medicaid or by another third party.

8 Medicare Advantage Plan Types: HMO - (Health Maintenance Organization) To receive care through an HMO, you must use a doctor network. Other Medicare plans are HMO plans that offer a Point-of-Service (POS) option, where members have the flexibility to go out of the network to receive some health care services. Generally, copayments and coinsurance will be higher for care received outside of the plan's network. PPO- (Preferred Provider Organization) A PPO usually has a higher monthly premium than an HMO, but you are paying to have the freedom to use doctors in network as well as out-of-network. This gives you more flexibility when it comes to choosing a doctor. If you choose to use a doctor out-ofnetwork, you will pay a higher out of pocket expense. PFFS - (Private Fee For Service) Private Fee-For-Service (PFFS) plans give you the freedom to receive care from any Medicare approved provider who agrees to accept the plan's terms and conditions of payment, and you do not need a referral to see a specialist. This plan combines the benefits and flexibility of private insurance with the predictability of controlled cost sharing. A PFFS usually pay higher out-of-pocket costs, but there is no doctor network that you have to follow. Prescription Drug Plans and Extra Help Prescription drug coverage is the most complex part of Medicare. The following description barely scratches the surface. Prescription drug coverage is available to everyone with Medicare and is only available through Private Insurance Companies. Even if you don t take many prescriptions now, you should join a Medicare drug plan. Just because you take no medications today does not mean it will remain that way tomorrow. If you do not join a Medicare drug plan when you re first eligible, and you don t have other creditable prescription drug coverage, or you don t get Extra Help, you ll likely pay a late enrollment penalty if you join a plan later. To get Medicare prescription drug coverage, you must join a plan run by an insurance company or other private company approved by Medicare. Each plan can vary in cost and specific drugs

9 covered. As previously mentioned, there are two ways to get Medicare prescription drug coverage: Medicare Prescription Drug Plans Medicare Advantage Plans (like an HMO or PPO You must live in the service area of the Medicare drug plan you want to join. If your Medicare Advantage Plan includes prescription drug coverage and you join a Medicare Prescription Drug Plan, you ll be disenrolled from your Medicare Advantage Plan and returned to Original Medicare. In other words, you are allowed Prescription Drug (Rx) coverage from only one source. There are four phases of Prescription Drug Coverage. The way these phases work is below: Many people are worried about but not everyone will enter the coverage gap. Some plans offer additional coverage during the gap, for generic drugs and maybe limited brand drugs, but they may charge a higher monthly premium. Check with the plan first to see if your drugs would be covered during the gap. In addition to the discount on covered brand-name prescription drugs, there will be increasing coverage for drugs in the coverage gap each year until the gap closes in 2020.

10 What is the Part D late enrollment penalty? The late enrollment penalty is an amount that s added to your Part D premium. You may owe a late enrollment penalty if at any time after your initial enrollment period is over, there s a period of 63 or more days in a row when you don t have Part D or other creditable prescription drug coverage. If you get Extra Help, you don t pay a late enrollment penalty. In order to avoid paying a penalty, you can: Join a Medicare drug plan when you re first eligible. Don t go 63 days or more in a row without creditable drug coverage. Tell your plan about your drug coverage history When you join a Medicare drug plan, if the plan believes you went at least 63 days in a row without other creditable prescription drug coverage, the plan will send you a letter. The letter will include a form asking about any drug coverage you had. Complete the form and return it to your drug plan. If you don t tell the plan about your creditable prescription drug coverage, you may have to pay a penalty. How much is the penalty? The cost of the late enrollment penalty depends on how long you didn t have creditable prescription drug coverage. Currently, the late enrollment penalty is calculated by multiplying 1% of the national base beneficiary premium ($31.08 in 2012) times the number of full, uncovered months that you were eligible but didn t join a Medicare drug plan and went without other creditable prescription drug coverage. The national base beneficiary premium changes each year, the penalty amount may also change each year. You have to pay this penalty every month for as long as you have a Medicare drug plan unless you become eligible for Extra Help. If you have limited income and resources, you may qualify for help to pay for some health care and prescription drug costs. Extra Help is a Medicare program to help people with limited income and resources pay Medicare prescription drug costs. You may qualify for Extra Help, also called the low-income subsidy (LIS), if your yearly income and resources are below certain limits. Extra Help / Low Income Subsidy (LIS) You automatically qualify for Extra Help if you have Medicare and if you:

11 Have full Medicaid coverage. Get help from your state Medicaid program paying your Part B premium Get Supplemental Security Income (SSI) benefits. HOW CAN I GET EXTRA HELP WITH MY PRESCRIPTION DRUG PLAN COSTS OR GET EXTRA HELP WITH OTHER MEDICARE COSTS? You may be able to get extra help to pay for your prescription drug premiums and costs as well as get help with other Medicare costs. To see if you qualify for getting extra help, call: *1-800-MEDICARE ( ). TTY/TDD users should call , 24 hours a day/7 days a week; and see Programs for People with Limited Income and Resources in the publication Medicare & You. *The Social Security Administration at between 7 a.m. and 7 p.m., Monday through Friday. TTY/TDD users should call ; or Your State Medicaid Office.

12 Thank you for requesting our brochure! We hope it has been helpful. As an independent full service Georgia insurance agency our duty is to our clients, not the insurance companies. We are committed to providing you with great service and protection at the most affordable rates. We make YOU our number one priority. Comparing plans is easy with our help. A licensed agent is always available to help you with the shopping process. Our service is 100% free and you are under no obligation to purchase anything. A courteous, licensed agent will provide quotes & expert advice while assisting you in your senior health plan purchase decision. Whether you are interested in a Medicare Supplement Plan, Medicare Advantage Plan, a Medicare Part D (Drug Plan) or are not sure. We can help make selecting the right plan easy! Simply call or us at info@thesurrettgroup.com to begin. We represent Georgia s most trusted and respected insurance companies. We know you expect the best value without sacrificing personalized service and that s what we do at The Surrett Group LLC. A few of the more popular insurance companies we represent are as follows: AARP/United Healthcare Aetna/ Coventry Health Care of Georgia American Continental Insurance Banner Life Blue Cross Blue Shield of Georgia Care Improvement Plus Cigna-HealthSpring Companion Life Continental Life Insurance Company Delta Dental Equitable Life and Casualty Genworth Financial GTLIC/Guarantee Trust Life Insurance Company Humana John Hancock Lincoln Financial Manhattan Life Medico Insurance Company Mutual of Omaha New Era/Philadelphia Life Oxford Life

13 Piedmont WellStar Health Plans Protective Life Prudential Standard Life & Accident Transamerica Wellcare Medicare Explained We look forward to an opportunity to earn your trust. This brochure does not offer any insurance advice nor does it mention or promote any specific plan of insurance. It is intended solely as a piece to help educate Medicare Eligible persons about Medicare and the available Medicare Insurance options in plain and easy language.

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