blue cross of idaho seeks to boost medicare advantage...

CONTACT: Josh Jordan, 208.331.7465, [email protected]

FOR IMMEDIATE RELEASE

Blue Cross of Idaho seeks to boost Medicare Advantage enrollment by offering a free series of seminars throughout the Gem State

MERIDIAN, Idaho (Oct. 15, 2012) — Although only 13 other states enjoy higher Medicare Advantage participation rates than Idaho, more than 70 percent of Gem State residents who are eligible to enroll do not actually opt in despite compelling advantages.

While some folks are unaware of Medicare Advantage or think they simply can’t afford it, Blue Cross of Idaho says the lion’s share of those who don’t enroll either do not recognize the value or find the sign-up process confusing. Regardless, the state’s leading health insurance provider says the financial consequences of not having a Medicare Advantage plan can be devastating.

“Many people don’t realize there are huge gaps with Original Medicare,” Karen Early, Blue Cross of Idaho’s director of corporate communications, says. “It doesn’t pay for everything — there are significant costs you as a patient must pay with Original Medicare.”

For instance, Early says you are responsible for paying all deductibles and coinsurance with Original Medicare. In addition, she says you must pay for any gaps in coverage, including Part D prescription drug coverage, routine vision exams, emergency services outside the United States, and other services.

“Original Medicare has no limit on out-of-pocket spending,” Early says. “That means without enrolling in a Medicare Advantage plan you could face a huge medical bill if something catastrophic happens to you.”

In addition to building awareness about the benefits of Medicare Advantage plans, Blue Cross of Idaho is seeking to make the enrollment process less daunting by hosting a series of free seminars statewide during this year’s open enrollment period Oct. 15-Dec. 7. Early says representatives will be on hand at the events to help participants make more informed healthcare decisions and navigate Original Medicare and Medicare Advantage.

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FREE MEDICARE ADVANTAGE SEMINARS OCT. 15, 2012 • PAGE 2 OF 2 Seminars slated for 2012 include:

• Coeur d’Alene — Oct. 18, Oct. 25, Nov. 1, Nov. 8, Nov. 15, Nov. 29, and Dec. 6 at 10 a.m. at the AmeriTel Inn at 333 Ironwood Ave.

• Idaho Falls — Oct. 17, Oct. 31, and Nov. 14 at 10 a.m. at the Hampton Inn at 2500 Channing Way.

• Meridian — Oct. 15, Oct. 22, Oct. 29, Nov. 5, Nov. 12, Nov. 19, Nov. 26, and Dec. 3 at 10 a.m. at Blue Cross of Idaho’s headquarters at 3000 E. Pine Ave.

• Nampa — Oct. 16, Oct. 30, Nov. 13, Nov. 20, and Dec. 4 at 10 a.m. at the Nampa Civic Center at 311 3rd St. S.

• Pocatello — Oct. 19, Oct. 26, Nov. 6, Nov. 30, and Dec. 5 at 10 a.m. at the Clarion Inn at 1300 Pocatello Bench Rd.

Those interested in attending one of the free seminars can register seven days a week between 8 a.m. and 8 p.m. by calling toll-free 1-888-492-2583, or TTY 1-800-377-1363 for the hearing impaired. Or register online at www.bcidaho.com/medicare.

About Blue Cross of Idaho Blue Cross of Idaho, a not-for-profit mutual insurance company, is a leader in delivering innovative health insurance products, services and information to more than 650,000 members. For 66 years, the company has served its customers by offering health insurance at a competitive price and has served the people of Idaho through support of community organizations, programs and events that promote good health. Blue Cross of Idaho is an independent licensee of the Blue Cross and Blue Shield Association. Visit bcidaho.com for more information.

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FOR RELEASE OCT. 15, 2012

The facts about Medicare Advantage in Idaho

Medicare beneficiaries

• Medicare beneficiaries in Idaho reached 232,471 in Idaho in 2011 — 15 percent of the state’s total population.1

• Last year the majority of Medicare beneficiaries in Idaho — 84.2 percent — aged into Medicare, versus 15.8 percent that were on disability.1

• In 2009-2010, 12 percent of Idahoans relied on Medicare for health insurance coverage — the same for the U.S. as a whole.1 Sources of health insurance coverage for the rest of the state’s population during the same period was: employers, 48 percent; individual, 8 percent; Medicaid, 13 percent; other public, 1 percent; and uninsured, 17 percent.1

Medicare Advantage enrollment

• In 2011 63,070 Idaho residents enrolled in Medicare Advantage programs, representing 0.5 percent of total U.S. Medicare Advantage enrollment.1 Similarly, U.S. Census Bureau estimates place Idaho’s 2011 population at 1,584,985 — 0.5 percent of its 2011 estimate of 311,591,917 for the total U.S. population.2

• Idaho enjoys a higher Medicare Advantage enrollment rate than the nation as a whole. Medicare Advantage enrollment for the U.S. overall was 25.6 percent in 2011 compared to 27.7 percent for the Gem State.1

• Nevertheless, more than 70 percent of Gem State residents who are eligible to enroll in Medicare Advantage programs choose not to.1

• Open enrollment for Medicare Advantage begins Oct. 15 and ends Dec. 7.

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IDAHO MEDICARE ADVANTAGE FACTS OCT. 15, 2012 • PAGE 2 OF 2 How Idaho compares to other western states

• Only 13 other states nationwide enjoyed higher Medicare Advantage plan penetration rates than Idaho in 2011.1

• Idaho ranked seventh in Medicare Advantage plan penetration rates among the 11 western states in 2011.1 From highest to lowest, the rates are: Oregon, 41.2 percent; Arizona, 37.1 percent; California, 36.3 percent; Utah, 34.6 percent; Colorado, 33.9 percent; Nevada, 30.9 percent; Idaho, 28.7 percent; New Mexico, 26.2 percent; Washington, 25.5 percent; Montana, 14.9 percent; Wyoming, 5.8 percent.1

About Blue Cross of Idaho

• Blue Cross of Idaho, a not-for-profit mutual insurance company, is a leader in delivering innovative health insurance products, services and information to more than 650,000 members. For 66 years, the company has served its customers by offering health insurance at a competitive price and has served the people of Idaho through support of community organizations, programs and events that promote good health. Blue Cross of Idaho is an independent licensee of the Blue Cross and Blue Shield Association. Visit bcidaho.com for more information.

• Blue Cross of Idaho’s True Blue HMO Medicare Advantage health insurance plans received the highest possible member satisfaction rating in the 2011 edition of the official U.S. government Medicare handbook, “Medicare & You.” The Centers for Medicare and Medicaid Services publishes the handbook each year prior to annual enrollment as a guide for people who are eligible for Medicare. Its bases these ratings on customer experiences with health plans and the services members receive.

• Blue Cross of Idaho offers Medicare Advantage plans in 33 counties throughout Idaho.

• More than half of Idahoans who enroll in Medicare Advantage plans — 32,000 — choose a Medicare Advantage plan from Blue Cross of Idaho

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1 According to data compiled by the Kaiser Family Foundation. Additional data and other details are available at statehealthfacts.org.

2 According to estimates from the U.S. Census Bureau. Details are available at quickfacts.census.gov.



The basics of Medicare Medicare is health insurance for…

• People 65 or older who are eligible for Medicare

• People under 65 who are on Social Security as a result of a disability, and in some cases people with end-stage renal disease (ESRD)

Medicare is organized into four parts

• Medicare Part A — Part A is hospital insurance that helps pay for inpatient hospital stays, skilled nursing facilities, home healthcare, hospice and other related services, and is free for most people.

• Medicare Part B — Part B is medical insurance that helps pay for medically necessary doctors’ services, outpatient care, durable medical equipment, lab work, and home healthcare. You pay a monthly Part B premium if you want this optional coverage.

• Medicare Part C — Part C, also known as Medicare Advantage, enables you to enroll in a private health plan, such as an HMO (Health Maintenance Organization) or a PPO (Preferred Provider Organization) plan. You receive Medicare-covered medical benefits, and many plans include extras like vision, eyewear and wellness education.

• Medicare Part D — Also known as Medicare Prescription Drug Coverage, Part D is offered through private insurance plans as either a standalone prescription drug plan (PDP) or a Medicare Advantage prescription drug plan (MA-PD) that combines medical and drug coverage.

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THE BASICS OF MEDICARE OCT. 15, 2012 • PAGE 2 OF 2 Medicare eligibility

• Most Americans are eligible for full Medicare benefits once they reach age 65, unless they are on a special retirement program, such as Railroad Retirees.

• In 2012, open enrollment for Medicare Advantage plans (Part C) begins earlier than in the past — Oct. 15 — and ends Dec. 7.

• If you are age 65 or older and still working and not on Social Security, you can still sign up for Medicare if you choose.

• If your birthday is on the first day of the month, Medicare Parts A and B will start the first day of the prior month.

• In most cases, if you’re already getting benefits from Social Security or the Railroad Retirement Board (RRB), you will automatically get Medicare Parts A and B starting on the first day of the month you turn 65.

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The Medicare enrollment process Signing up for Original Medicare (Part A and Part B) If you are close to age 65 but are not getting Social Security or Railroad Retirement Board (RRB) benefits and you want Original Medicare (Part A or Part B), you will need to sign up — even if you’re eligible to get Part A premium-free. If you’re not eligible for premium-free Part A, you can buy Part A and Part B.

Automatic enrollment Some people are automatically enrolled in Medicare Part A and Part B:

• If you’re already getting Social Security and/or RRB benefits. In most cases, you will automatically get Part A and Part B starting the first day of the month you turn 65. If your birthday is on the first day of the month, Part A and Part B will start the first day of the prior month.

• If you’re under 65 and disabled. If so, you automatically get Part A and Part B after you get disability benefits from Social Security or certain disability benefits from the RRB for 24 months.

• If you have ALS. If you have amyotrophic lateral sclerosis, also called Lou Gehrig’s disease, you automatically get Part A and Part B the month your disability benefits begin.

If you’re automatically enrolled, you will get your red-white-and-blue Medicare card in the mail three months before your 65th birthday or your 25th month of disability. If you don’t want Part B, follow the instructions that come with the card, and send the card back. If you keep the card, you keep Part B and will pay Part B premiums.

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Your Medicare countdown • 6 months before turning 65 — Learn

the basics about what Original Medicare covers.

• 4 months before turning 65 — Review the various health plans available to you, such as Medicare Advantage plans from Blue Cross of Idaho.

• 3 months before turning 65 — Enroll in Medicare and consider enrolling in a Medicare Advantage plan so your benefits are ready and waiting when you turn 65.

MEDICARE ENROLLMENT PROCESS OCT. 15, 2012 • PAGE 2 OF 4 Regardless, contact Social Security three months before you turn 65, and if you worked for a railroad then contact the RRB to sign up

If you have end-stage renal disease (ESRD), you will need to visit your local Social Security office or call Social Security at 1-800-772-1213 to sign up for Part A and Part B. TTY users should call 1-800-325-0778. For more information, visit www.medicare.gov/publications to view the booklet “Medicare Coverage of Kidney Dialysis and Kidney Transplant Services.” You can also call 1-800-MEDICARE (1-800-633-4227) to find out if a copy can be mailed to you. TTY users should call 1-877-486-2048.

Call Social Security at 1-800-772-1213 for more information about your Medicare eligibility, and to sign up for Part A and/or Part B. If you’re 65 or older, you can also apply for premium-free Part A and Part B (for which you pay a monthly premium) at www.socialsecurity.gov/retirement. The whole process can take less than 10 minutes. If you get RRB benefits, call the RRB at 1-877-772-5772.

For general information about enrolling, visit www.medicare.gov/MedicareEligibility. You also can learn more about Idaho’s health insurance availability at http://healthinsurance.idaho.gov.

Initial Enrollment Period You can sign up when you’re first eligible for Part A and/or Part B (for which you pay monthly premiums) during your Initial Enrollment Period. For example, if you’re eligible when you turn 65, you can sign up during the seven-month period that begins three months before the month you turn 65, includes the month you turn 65, and ends three months after the month you turn 65. 3 months before the month you turn 65

2 months before the month you turn 65

1 month before the month you turn 65

The month you turn 65

1 month after you turn 65

2 months after you turn 65

3 months after you turn 65

Sign up early to avoid a delay in coverage. To get Part A and/or Part B the month you turn 65, you must sign up during the first 3 months before you turn 65.

If you wait until the last 4 months of your Initial Enrollment Period to sign up for Part A and/or Part B, your coverage will be delayed.

If you sign up for Part A and/or Part B during the first 3 months of your Initial Enrollment Period, your coverage start date will depend on your birthday:

• If your birthday isn’t on the first day of the month, your Part B coverage starts the first day of your birthday month. For example, Mr. Green’s 65th birthday is July 20, 2012. If he enrolls in April, May, or June, his coverage will start on July 1, 2012.

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MEDICARE ENROLLMENT PROCESS OCT. 15, 2012 • PAGE 3 OF 4

• If your birthday is on the first day of the month, your coverage will start the first day of the prior month. For example, Mr. Kim’s 65th birthday is July 1, 2012. If he enrolls in March, April, or May, his coverage will start on June 1, 2012.

If you enroll in Part A and/or Part B the month you turn 65 or during the last three months of your Initial Enrollment Period, your start date will be delayed:

If you enroll in this month of your initial enrollment period:

Your coverage starts:

The month you turn 65 1 month after enrollment

1 month after you turn 65 2 months after enrollment

2 months after you turn 65 3 months after enrollment

3 months after you turn 65 3 months after enrollment

General Enrollment Period If you didn’t sign up for Part A and/or Part B (for which you pay monthly premiums) when you were first eligible, you can sign up between January 1–March 31 each year. Your coverage will begin July 1. You may have to pay a higher premium for late enrollment.

Special Enrollment Period If you didn’t sign up for Part A and/or Part B (for which you pay monthly premiums) when you were first eligible because you’re covered under a group health plan based on current employment, you can sign up for Part A and/or Part B as follows:

• Anytime you or your spouse (or family member if you’re disabled) is working, and you’re covered by a group health plan through the employer or union based on that work.

• OR during the eight-month period that begins the month after the employment ends or the group health plan insurance based on current employment ends, whichever happens first.

Usually you don’t pay a late enrollment penalty if you sign up during a Special Enrollment Period. You may also qualify for a Special Enrollment Period if you’re a volunteer serving in a foreign country.

COBRA and retiree health plans aren’t considered coverage based on current employment. You’re not eligible for a Special Enrollment Period when that coverage ends. To avoid paying a higher premium, make sure you sign up for Medicare when you’re first eligible.

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MEDICARE ENROLLMENT PROCESS OCT. 15, 2012 • PAGE 4 OF 4 Medicare Supplement Insurance (Medigap) Open Enrollment Period Medicare Supplement Insurance (Medigap) policies, sold by private insurance companies, help pay some of the healthcare costs that Medicare doesn’t cover. You have a six-month Medigap Open Enrollment Period, which starts the first month you’re 65 and enrolled in Part B. This period gives you a guaranteed right to buy any Medigap policy sold in Idaho regardless of your health status. Once this period starts, it can’t be delayed or replaced.

To learn more details about enrollment periods, visit www.medicare.gov/publications to view the fact sheet “Understanding Medicare Enrollment Periods.” You also can call 1-800-MEDICARE (1-800-633-4227) to find out if a copy can be mailed to you. Hearing-impaired (TTY) users should call 1-877-486-2048.

Your Medicare coverage choices at a glance There are two main ways to get your Medicare coverage: Original Medicare or a Medicare Advantage plan. Your decision-making process should include:

STEP 1: Decide how you want to get your Medicare coverage

ORIGINAL MEDICARE MEDICARE ADVANTAGE PLAN

Part A (hospital insurance) and Part B (medical insurance)

Includes both Part A (hospital insurance) and Part B (medical insurance)

STEP 2: Decide if you need to add prescription drug coverage

Part D (prescription drug coverage) Part D (prescription drug coverage)

STEP 3: Decide if you need to add supplemental coverage

Medicare Supplement Insurance (Medigap) policy

If you join a Medicare Advantage plan, you do NOT need and CANNOT be sold a Medicare

Supplement Insurance (Medigap) policy

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Frequently asked questions about Medicare What is Medicare? Medicare is health insurance for people 65 or older, people under 65 with certain disabilities and in some cases those with end-stage renal disease (ESRD). ESRD is permanent kidney failure requiring dialysis or a kidney transplant.

Do I have to pay for Original Medicare? Typically you pay nothing for Medicare Part A (hospital insurance), but Medicare Part B (medical insurance) does have a premium.

When can I enroll in Medicare? You have a seven-month period to enroll: the three months before, the month of, and the three months after your 65th birthday. This is called the Initial Enrollment Period.

What if I don’t enroll in Medicare Part B? If you don’t sign up during your Initial Enrollment Period, a 10 percent penalty may be added to your premium — unless you have insurance through you or your spouse’s employer. In this case, you’d qualify for a Special Enrollment Period.

How serious is the penalty for not enrolling on time? It’s sizable and grows over time with each 12-month period that you delay in enrolling in Medicare Part B. For example, if you delay enrolling for two years after your Initial Enrollment Period, the premium penalty would be 20 percent. And it stays in place for as long as you have Part B.

Can I continue to work and still enroll in Medicare? Yes. At age 65, you are eligible for full Medicare benefits. If you or your spouse actively work and receive employer health insurance you can continue with that coverage for as long as you like. When you’re ready to move from your employer’s plan, you’ll qualify for a Special Enrollment Period to sign up for Medicare Part B. This period begins whenever your employer or union coverage ends, or when employment ends — whichever comes first. Be sure to elect Part B at that time to avoid the late enrollment penalty.

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FREQUENTLY ASKED QUESTIONS ABOUT MEDICARE OCT. 15, 2012 • PAGE 2 OF 3 Should I rely on Original Medicare alone for my health coverage? The fact is Medicare doesn’t pay for everything. With Original Medicare only (Parts A and B), you are responsible for paying all deductibles and coinsurance. You must also pay for any gaps in coverage, including Part D prescription drug coverage, routine vision exams, emergency services outside the U.S., and other services. Original Medicare has no limit on out-of-pocket spending. One serious medical episode can put patients on the hook for thousands of dollars.

How can I protect myself against Medicare’s coverage gaps and unlimited out-of-pocket expenses? You can join a Medicare Advantage plan (Part C), OR you can add a Medicare Supplement policy, which is also known as a Medigap policy. Medicare Advantage plans are generally HMO and PPO plans that provide all the healthcare coverage you receive under Medicare, and may include extra benefits like vision, eyewear and wellness education. Out-of-pocket spending (other than your monthly premium) is capped. Many Medicare Advantage plans offer medical and drug coverage in one convenient plan. Medicare Supplement policies are supplemental insurance plans that help fill Medicare’s gaps. Some plans have little or no out-of-pocket costs for covered services (other than your monthly premium). In general, Medicare Supplement plans do not include drug coverage.

Can I continue to see my doctor if I enroll in a Medicare Advantage plan? In most cases, with Blue Cross of Idaho’s True Blue HMO (health maintenance organization) and Secure Blue PPO (preferred provider organization) Medicare Advantage health insurance plans, you can use the same doctors and hospitals you do right now thanks to our large provider network.

How comprehensive is the coverage of a Medicare Advantage plan? Plans vary so make sure you examine and compare offerings carefully. Blue Cross of Idaho’s True Blue HMO and Secure Blue PPO Medicare Advantage health insurance plans cover vision and eyewear, as well as a free annual physical, preventive benefits like cancer screenings, mammograms and more. You can also get your Part D prescription drug coverage and medical coverage combined into a single plan, simplifying your paperwork and premiums.

Will a Medicare Advantage plan pay for my prescription drugs? Many Medicare Advantage plans include coverage for prescription drugs. Some plans may also offer Medicare-approved drug discount cards to help you save on your outpatient prescription drugs. Extra help paying for prescription drugs may be available if you have a low income and limited assets. Otherwise, you can enroll in a Medicare Part D plan. Also known as Medicare Prescription Drug Coverage, Part D is offered through private insurance plans as either a standalone prescription drug plan (PDP) or a Medicare Advantage prescription drug plan (MA-PD) that combines medical and drug coverage.

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FREQUENTLY ASKED QUESTIONS ABOUT MEDICARE OCT. 15, 2012 • PAGE 3 OF 3 How expensive are the premiums for a Medicare Advantage plan? In addition to your Part B premium, you usually pay one monthly premium for the services included in a Medicare Advantage (Part C) plan. Part C plans vary from provider to provider, but Blue Cross of Idaho’s Medicare Advantage plans start at just $24 per month and offer low, fixed copays. They also offer exclusive discounts on health-related products and services through Blue Extras.

What if I already have a Medigap policy? If you get your Medicare healthcare from Original Medicare, you may have a Medigap (Medicare supplement insurance) policy to pay the gaps in Original Medicare. Medigap policies only work with Original Medicare. You cannot buy a Medigap policy if you are in a Medicare Advantage plan.

When can I enroll in a Medicare Advantage plan? Open enrollment for Medicare Advantage begins Oct. 15 and ends Dec. 7 in 2012.

Where can I learn more about Medicare? Visit www.ssa.gov and www.medicare.gov for additional information about Original Medicare. You can also contact the Medicare experts at Blue Cross of Idaho, who can help you explore your options and choose the right plan for your needs. For more information call 1-888-492-2583 or TTY 1-800-377-1363 for the hearing impaired. We are available from 8 a.m. to 8 p.m. seven days a week. Or visit www.bcidaho.com/medicare.

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The ABC’s of Medicare: a glossary of terms Navigating Medicare can be challenging — especially if you don’t understand the lingo. The following list of Medicare-related terms is from the glossary at Medicare.gov — the official U.S. government site for Medicare.

Accreditation A process where external organizations (or "accrediting bodies") evaluate healthcare facilities' policies, procedures, and performance to make sure they are meeting predetermined criteria.

Advance Beneficiary Notice (ABN) In Original Medicare, a notice that a doctor, supplier, or provider gives a Medicare beneficiary before furnishing an item or service if the doctor, supplier, or provider believes that Medicare may deny payment. In this situation, if you aren't given an ABN before you get the item or service, and Medicare denies payment, then you may not have to pay for it. If you are given an ABN, and you sign it, you will probably have to pay for the item or service if Medicare denies payment.

Advance coverage decision A notice you get from a Medicare Advantage Plan letting you know in advance whether it will cover a particular service.

Appeal An appeal is the action you can take if you disagree with a coverage or payment decision made by Medicare, your Medicare health plan, or your Medicare Prescription Drug Plan. You can file an appeal if Medicare or your plan does one of these:

• Your request for a healthcare service, supply, or prescription that you think you should be able to get

• Your request for payment for healthcare or a prescription drug you already got

• Your request to change the amount you must pay for a prescription drug

You can also appeal if you're already getting coverage and Medicare or your plan stops paying.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 2 OF 15 Assignment An agreement by your doctor or other supplier to be paid directly by Medicare, to accept the payment amount Medicare approves for the service, and not to bill you for any more than the Medicare deductible and coinsurance. Beneficiary A person who has healthcare insurance through the Medicare or Medicaid programs. Benefit period The way that Original Medicare measures your use of hospital and skilled nursing facility (SNF) services. A benefit period begins the day you're admitted as an inpatient in a hospital or skilled nursing facility. The benefit period ends when you haven't received any inpatient hospital care (or skilled care in a SNF) for 60 days in a row. If you go into a hospital or a skilled nursing facility after one benefit period has ended, a new benefit period begins. You must pay the inpatient hospital deductible for each benefit period. There is no limit to the number of benefit periods. Centers for Medicare & Medicaid Services (CMS) The federal agency that runs the Medicare, Medicaid, and Children's Health Insurance Programs. Certified (certification) See "Medicare-certified provider." Children's Health Insurance Program (CHIP) A joint federal and state program that provides free or low-cost health coverage for children up to age 19. Claim A request for payment that you submit to Medicare or other health insurance when you get items and services that you think are covered. Coinsurance An amount you may be required to pay as your share of the cost for services after you pay any deductibles. Coinsurance is usually a percentage (for example, 20%). Coordination of benefits A way to figure out who pays first when 2 or more health insurance plans are responsible for paying a medical claim.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 3 OF 15 Copay or Copayment An amount you may be required to pay as your share of the cost for a medical service or supply, like a doctor's visit, hospital outpatient visit, or prescription. A copayment is usually a set amount, rather than a percentage. For example, you might pay $10 or $20 for a doctor's visit or prescription. Cost sharing An amount you may be required to pay as your share of the cost for a medical service or supply, like a doctor's visit, hospital outpatient visit, or prescription drug. This amount can include copayments, coinsurance, and/or deductibles. Coverage determination (Part D) The first decision made by your Medicare drug plan (not the pharmacy) about your drug benefits, including the following:

• Whether a particular drug is covered

• Whether you have met all the requirements for getting a requested drug • How much you’re required to pay for a drug

• Whether to make an exception to a plan rule when you request it The drug plan must give you a prompt decision (72 hours for standard requests, 24 hours for expedited requests). If you disagree with the plan’s coverage determination, the next step is an appeal. Coverage gap (Medicare prescription drug coverage) A period of time in which you pay higher cost sharing for prescription drugs until you spend enough to qualify for catastrophic coverage. The coverage gap (also called the “donut hole”) starts when you and your plan have paid a set dollar amount for prescription drugs during that year. Creditable coverage (Medigap) Previous health insurance coverage that can be used to shorten a pre-existing condition waiting period under a Medigap policy. Creditable prescription drug coverage Prescription drug coverage (for example, from an employer or union) that's expected to pay, on average, at least as much as Medicare's standard prescription drug coverage. People who have this kind of coverage when they become eligible for Medicare can generally keep that coverage without paying a penalty, if they decide to enroll in Medicare prescription drug coverage later.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 4 OF 15 Critical access hospital (CAH) A small facility that provides outpatient services, as well as inpatient services on a limited basis, to people in rural areas. Custodial care Non-skilled personal care, such as help with activities of daily living like bathing, dressing, eating, getting in or out of a bed or chair, moving around, and using the bathroom. It may also include the kind of health-related care that most people do themselves, like using eye drops. In most cases, Medicare doesn't pay for custodial care. Deductible The amount you must pay for healthcare or prescriptions before Original Medicare, your prescription drug plan, or your other insurance begins to pay. Deemed status A provider or supplier earns this when they have been accredited by a national accreditation program (approved by the Centers for Medicare & Medicaid Services) that they demonstrate compliance with certain conditions. Demonstrations Special projects, sometimes called "pilot programs" or "research studies," that test improvements in Medicare coverage, payment, and quality of care. They usually operate only for a limited time, for a specific group of people, and in specific areas. Department of Health and Human Services (HHS) A federal agency that administers programs for protecting the health of all Americans, including the Medicare, Medicaid, and Children's Health Insurance Programs. DME Medicare Administrative Contractor (MAC) A private company that contracts with Medicare to pay bills for durable medical equipment. Drug list A list of prescription drugs covered by a prescription drug plan or another insurance plan offering prescription drug benefits. This list is also called a formulary. End-Stage Renal Disease (ESRD) Permanent kidney failure that requires a regular course of dialysis or a kidney transplant.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 5 OF 15 Exception A type of Medicare prescription drug coverage determination. A formulary exception is a drug plan's decision to cover a drug that's not on its drug list or to waive a coverage rule. A tiering exception is a drug plan's decision to charge a lower amount for a drug that's on its non-preferred drug tier. You must request an exception, and your doctor or other prescriber must send a supporting statement explaining the medical reason for the exception. Excess charge If you have Original Medicare, and the amount a doctor or other healthcare provider is legally permitted to charge is higher than the Medicare-approved amount, the difference is called the excess charge. Extra Help A Medicare program to help people with limited income and resources pay Medicare prescription drug program costs, such as premiums, deductibles, and coinsurance. Formulary A list of prescription drugs covered by a prescription drug plan or another insurance plan offering prescription drug benefits. Grievance A complaint about the way your Medicare health plan or Medicare drug plan is giving care. For example, you may file a grievance if you have a problem calling the plan or if you're unhappy with the way a staff person at the plan has behaved towards you. However, if you have a complaint about a plan's refusal to cover a service, supply, or prescription, you file an appeal. Guaranteed issue rights (also called "Medigap protections") Rights you have in certain situations when insurance companies are required by law to sell or offer you a Medigap policy. In these situations, an insurance company can't deny you a Medigap policy, or place conditions on a Medigap policy, such as exclusions for pre-existing conditions, and can't charge you more for a Medigap policy because of a past or present health problem. Guaranteed renewable policy An insurance policy that can't be terminated by the insurance company unless you make untrue statements to the insurance company, commit fraud, or don't pay your premiums. All Medigap policies issued since 1992 are guaranteed renewable. High-deductible Medigap policy A type of Medigap policy that has a high deductible but a lower premium. You must pay the deductible before the Medigap policy pays anything. The deductible amount can change each year.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 6 OF 15 Independent reviewer An organization (sometimes called an Independent Review Entity or IRE) that has no connection to your Medicare health plan or Medicare Prescription Drug Plan. Medicare contracts with the IRE to review your case if you appeal your plan's payment or coverage decision or if your plan doesn't make a timely appeals decision. Initial coverage limit Once you have met your yearly deductible, you will pay a copayment or coinsurance for each covered drug until you reach your plan's out-of-pocket maximum (or initial coverage limit). You will then enter your plan's coverage gap (also called the "donut hole"). In-network Doctors, hospitals, pharmacies, and other healthcare providers that have agreed to provide members of a certain insurance plan with services and supplies at a discounted price. In some insurance plans, your care is only covered if you get it from in-network doctors, hospitals, pharmacies, and other healthcare providers. Inpatient prospective payment system (IPPS) Hospitals that have contracted with Medicare to provide acute inpatient care and accept a predetermined rate as payment in full. Inpatient rehabilitation facility A hospital, or part of a hospital, that provides an intensive rehabilitation program to inpatients. Institution A facility that provides short-term or long-term care, such as a nursing home, skilled nursing facility (SNF), or rehabilitation hospital. Private residences, such as an assisted-living facility or group home, aren’t considered institutions for this purpose. Lifetime reserve days In Original Medicare, these are additional days that Medicare will pay for when you are in a hospital for more than 90 days. You have a total of 60 reserve days that can be used during your lifetime. For each lifetime reserve day, Medicare pays all covered costs except for a daily coinsurance. Limiting charge In Original Medicare, the highest amount of money you can be charged for a covered service by doctors and other healthcare suppliers who don't accept assignment. The limiting charge is 15% over Medicare's approved amount. The limiting charge only applies to certain services and doesn't apply to supplies or equipment.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 7 OF 15 Long-term care A variety of services that help people with their medical and non-medical needs over a period of time. Long-term care can be provided at home, in the community, or in various types of facilities, including nursing homes and assisted living facilities. Most long-term care is custodial care. Medicare doesn't pay for this type of care if this is the only kind of care you need. Long-term care hospital Acute care hospitals that provide treatment for patients who stay, on average, more than 25 days. Most patients are transferred from an intensive or critical care unit. Services provided include comprehensive rehabilitation, respiratory therapy, head trauma treatment, and pain management. Medicaid A joint federal and state program that helps with medical costs for some people with limited income and resources. Medicaid programs vary from state to state, but most healthcare costs are covered if you qualify for both Medicare and Medicaid. Medicaid-certified provider A healthcare provider (like a home health agency, hospital, nursing home, or dialysis facility) that has been approved by Medicaid. Providers are approved or "certified" if they have passed an inspection conducted by a state government agency. Medically necessary Services or supplies that are needed for the diagnosis or treatment of your medical condition and meet accepted standards of medical practice. Medicare Medicare is the federal health insurance program for people who are age 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD). Medicare Administrative Contractor (MAC) A company that processes claims for Medicare. Medicare Advantage Plan (Part C) A Medicare Advantage Plan is a type of Medicare health plan offered by a private company that contracts with Medicare to provide you with all your Part A and Part B benefits. Medicare Advantage Plans include Health Maintenance Organizations, Preferred Provider Organizations, Private Fee-for-Service Plans, Special Needs Plans, and Medicare Medical Savings Account Plans. If you're enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan and aren't paid for under Original Medicare. Most Medicare Advantage Plans offer prescription drug coverage.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 8 OF 15 Medicare Advantage Prescription Drug (MA-PD) Plan A Medicare Advantage plan that offers Medicare prescription drug coverage (Part D), Part A, and Part B benefits in one plan. Medicare-approved amount In Original Medicare, this is the amount a doctor or supplier that accepts assignment can be paid. It may be less than the actual amount a doctor or supplier charges. Medicare pays part of this amount and you’re responsible for the difference. Medicare-approved supplier A company, person, or agency that has been certified by Medicare to give you a medical item or service, except when you're an inpatient in a hospital or skilled nursing facility. Medicare-certified provider A healthcare provider (like a home health agency, hospital, nursing home, or dialysis facility) that has been approved by Medicare. Providers are approved or "certified" by Medicare if they have passed an inspection conducted by a state government agency. Medicare only covers care given by providers who are certified. Medicare Coordination of Benefits Contractor The company that acts on behalf of Medicare to collect and manage information on other types of insurance or coverage that a person with Medicare may have, and determine whether the coverage pays before or after Medicare. Medicare Cost Plan A type of Medicare health plan available in some areas. In a Medicare Cost Plan, if you get services outside of the plan's network without a referral, your Medicare-covered services will be paid for under Original Medicare (your Cost Plan pays for emergency services or urgently needed services). Medicare Health Maintenance Organization (HMO) Plan A type of Medicare Advantage Plan (Part C) available in some areas of the country. In most HMOs, you can only go to doctors, specialists, or hospitals on the plan's list except in an emergency. Most HMOs also require you to get a referral from your primary care physician. Medicare health plan A plan offered by a private company that contracts with Medicare to provide Part A and Part B benefits to people with Medicare who enroll in the plan. Medicare health plans include all Medicare Advantage Plans, Medicare Cost Plans, Demonstration/Pilot Programs, and Programs of All-inclusive Care for the Elderly (PACE).

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 9 OF 15 Medicare Medical Savings Account (MSA) Plan MSA Plans combine a high deductible Medicare Advantage Plan and a bank account. The plan deposits money from Medicare into the account. You can use the money in this account to pay for your healthcare costs, but only Medicare-covered expenses count toward your deductible. The amount deposited is usually less than your deductible amount so you generally will have to pay out-of-pocket before your coverage begins. Medicare Part A (Hospital Insurance) Part A covers inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home healthcare. Medicare Part B (Medical Insurance) Part B covers certain doctors' services, outpatient care, medical supplies, and preventive services. Medicare plan Any way other than Original Medicare that you can get your Medicare health or prescription drug coverage. This term includes all Medicare health plans and Medicare Prescription Drug Plans. Medicare Preferred Provider Organization (PPO) Plan A type of Medicare Advantage Plan (Part C) available in some areas of the country in which you pay less if you use doctors, hospitals, and other healthcare providers that belong to the plan's network. You can use doctors, hospitals, and providers outside of the network for an additional cost. Medicare prescription drug coverage (Part D) Optional benefits for prescription drugs available to all people with Medicare for an additional charge. This coverage is offered by insurance companies and other private companies approved by Medicare. Medicare Prescription Drug Plan (Part D) Part D adds prescription drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private-Fee-for-Service Plans, and Medicare Medical Savings Account Plans. These plans are offered by insurance companies and other private companies approved by Medicare. Medicare Advantage Plans may also offer prescription drug coverage that follows the same rules as Medicare Prescription Drug Plans.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 10 OF 15 Medicare Private Fee-For-Service (PFFS) Plan A type of Medicare Advantage Plan (Part C) in which you can generally go to any doctor or hospital you could go to if you had Original Medicare, if the doctor or hospital agrees to treat you. The plan determines how much it will pay doctors and hospitals, and how much you must pay when you get care. A Private Fee-For-Service Plan is very different than Original Medicare, and you must follow the plan rules carefully when you go for healthcare services. When you're in a Private Fee-For-Service Plan, you may pay more or less for Medicare-covered benefits than in Original Medicare. Medicare Savings Program A Medicaid program that helps people with limited income and resources pay some or all of their Medicare premiums, deductibles, and coinsurance. Medicare SELECT A type of Medigap policy that may require you to use hospitals and, in some cases, doctors within its network to be eligible for full benefits. Medicare Special Needs Plan (SNP) A special type of Medicare Advantage Plan (Part C) that provides more focused and specialized healthcare for specific groups of people, such as those who have both Medicare and Medicaid, who live in a nursing home, or have certain chronic medical conditions. Medicare Summary Notice (MSN) A notice you get after the doctor or provider files a claim for Part A or Part B services in Original Medicare. It explains what the doctor or provider billed for, the Medicare-approved amount, how much Medicare paid, and what you must pay. Medigap basic benefits Benefits that all Medigap policies must cover, including Part A and Part B coinsurance amounts, blood, and additional hospital benefits not covered by Original Medicare. Medigap Open Enrollment Period A one-time-only, 6-month period when federal law allows you to buy any Medigap policy you want that's sold in your state. It starts in the first month that you're covered under Part B and you're age 65 or older. During this period, you can't be denied a Medigap policy or charged more due to past or present health problems. Some states may have additional open enrollment rights under state law.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 11 OF 15 Medigap policy Medicare Supplement Insurance sold by private insurance companies to fill "gaps" in Original Medicare coverage. Network pharmacies Pharmacies that have agreed to provide members of certain Medicare plans with services and supplies at a discounted price. In some Medicare plans, your prescriptions are only covered if you get them filled at network pharmacies. Non-preferred pharmacy A pharmacy that's part of a Medicare drug plan's network, but isn't a preferred pharmacy. You may pay higher out-of-pocket costs if you get your prescription drugs from a non-preferred pharmacy instead of a preferred pharmacy. Optional supplemental benefits Services that Medicare doesn't cover, but that a Medicare health plan may choose to offer. If you enroll in a plan with these services, you may choose to buy the services. If you choose to buy these benefits, you will pay for them directly, usually as a premium, copayment, and/or coinsurance. These services may be offered individually or as a group of services, and they may be different for each Medicare health plan. Original Medicare Original Medicare is fee-for-service coverage under which the government pays your healthcare providers directly for your Part A and/or Part B benefits. Out-of-network A benefit that may be provided by your Medicare Advantage plan. Generally, this benefit gives you the choice to get plan services from outside of the plan's network of healthcare providers. In some cases, your out-of-pocket costs may be higher for an out-of-network benefit. Out-of-pocket costs Health or prescription drug costs that you must pay on your own because they aren’t covered by Medicare or other insurance. Penalty An amount added to your monthly premium for Part B or a Medicare drug plan (Part D) if you don't join when you're first eligible. You pay this higher amount as long as you have Medicare. There are some exceptions.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 12 OF 15 Pharmacy network Pharmacies that have agreed to provide members of certain Medicare plans with services and supplies at a discounted price. In some Medicare plans, your prescriptions are only covered if you get them filled at network pharmacies. Pilot programs See "demonstrations." Point-of-service option In a Health Maintenance Organization (HMO), this option lets you use doctors and hospitals outside the plan for an additional cost. Pre-existing condition A health problem you had before the date that a new insurance policy starts. Preferred pharmacy A pharmacy that's part of a Medicare drug plan's network. You pay lower out-of-pocket costs if you get your prescription drugs from a preferred pharmacy instead of a non-preferred pharmacy. Premium The periodic payment to Medicare, an insurance company, or a healthcare plan for health or prescription drug coverage. Preventive services Healthcare to prevent illness or detect illness at an early stage, when treatment is likely to work best (for example, preventive services include Pap tests, flu shots, and screening mammograms). Primary care doctor (PCP) The doctor you see first for most health problems. He or she makes sure you get the care you need to keep you healthy. He or she also may talk with other doctors and healthcare providers about your care and refer you to them. In many Medicare Advantage Plans, you must see your primary care doctor before you see any other healthcare provider. Prior authorization Approval from a Medicare drug plan that may be required before you fill your prescription for the prescription to be covered by your plan.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 13 OF 15 Programs of All-inclusive Care for the Elderly (PACE) A special type of health plan that provides all the care and services covered by Medicare and Medicaid as well as additional medically-necessary care and services based on your needs as determined by an interdisciplinary team. PACE serves frail older adults who need nursing home services but are capable of living in the community. PACE combines medical, social, and long-term care services and prescription drug coverage. Qualified Disabled and Working Individuals (QDWI) Program A state program that helps pay Part A premiums for people who have Part A and limited income and resources. Qualified Individual (QI) Program A state program that helps pay Part B premiums for people who have Part A and limited income and resources. Qualified Medicare Beneficiary (QMB) Program A state program that helps pay Part A premiums, Part B premiums, and other cost-sharing (like deductibles, coinsurance, and copayments) for people who have Part A and limited income and resources. Quality Improvement Organization (QIO) A group of practicing doctors and other healthcare experts paid by the federal government to check and improve the care given to people with Medicare. Recovery contractor A company that acts on behalf of Medicare to obtain repayment when Medicare makes a conditional payment and the other payer is determined to be primary. Referral A written order from your primary care doctor for you to see a specialist or get certain medical services. In many Health Maintenance Organizations (HMOs), you need to get a referral before you can get medical care from anyone except your primary care doctor. If you don't get a referral first, the plan may not pay for the services. Secondary payer The insurance policy, plan, or program that pays second on a claim for medical care. This could be Medicare, Medicaid, or other insurance depending on the situation.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 14 OF 15 Service area A geographic area where a health insurance plan accepts members if it limits membership based on where people live. For plans that limit which doctors and hospitals you may use, it's also generally the area where you can get routine (non-emergency) services. The plan may disenroll you if you move out of the plan's service area. Skilled nursing facility (SNF) A nursing facility with the staff and equipment to give skilled nursing care and, in most cases, skilled rehabilitative services and other related health services. Specified Low-Income Medicare Beneficiary (SLMB) Program A state program that helps pay Part B premiums for people who have Part A and limited income and resources. State Health Insurance Assistance Program (SHIP) A state program that gets money from the federal government to give free local health insurance counseling to people with Medicare. State Insurance Department A state agency that regulates insurance and can provide information about Medigap policies and other private health insurance. State Medical Assistance office A state agency that's in charge of the State's Medicaid program and can give information about programs that help pay medical bills for people with limited income and resources. State Pharmacy Assistance Program (SPAP) A state program that provides help paying for drug coverage based on financial need, age, or medical condition. State Survey Agency A state agency that oversees healthcare facilities that participate in the Medicare and/or Medicaid programs. The State Survey Agency inspects healthcare facilities and investigates complaints to ensure that health and safety standards are met. Step therapy A coverage rule used by some Medicare Prescription Drug Plans that requires you to try one or more similar, lower cost drugs to treat your condition before the plan will cover the prescribed drug.

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THE ABC’S OF MEDICARE: A GLOSSARY OF TERMS OCT. 15, 2012 • PAGE 15 OF 15 Supplier Generally, any company, person, or agency that gives you a medical item or service, except when you're an inpatient in a hospital or skilled nursing facility. Tiers Groups of drugs that have a different cost for each group. A drug in a lower tier will cost you less than a drug in a higher tier. TRICARE A healthcare program for active-duty and retired uniformed services members and their families. TRICARE FOR LIFE (TFL) Expanded medical coverage available to Medicare-eligible uniformed services retirees age 65 or older, their eligible family members and survivors, and certain former spouses. TTY A teletypewriter (TTY) is a communication device used by people who are deaf, hard-of-hearing, or have a severe speech impairment. People who don't have a TTY can communicate with a TTY user through a message relay center (MRC). An MRC has TTY operators available to send and interpret TTY messages. Urgently needed care Care that you get outside of your Medicare health plan's service area for a sudden illness or injury that needs medical care right away but isn’t life threatening. If it’s not safe to wait until you get home to get care from a plan doctor, the health plan must pay for the care. For more information Visit www.medicare.gov/glossary for additional definitions and information.

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