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Medicare 2016
Understanding Medicare
+Medicare – What is it?
n Health insurance for peoplen Age 65 and older
n Under age 65 with certain disabilities
n Any age with End-Stage Renal Disease (ESRD)
n Administered byn Centers for Medicare & Medicaid Services (CMS)
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Understanding Medicare
+A-B-C-D
n Medicare has four parts
n Part A – Hospital Insurance
n Part B – Medical Insurance
n Part C – Medicare Advantage Plans
n Part D – Prescription Drug Coverage
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Understanding Medicare
+
nOriginal Medicare
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CHOICES
Updated 11/13/15 AMS
Understanding Medicare
+Original Medicare
n Go to any provider that accepts Medicare
n You pay
n Part A - free for most people
n Part B premium in 2016
n $104.90 for those “held-harmless”
n $121.80 for new beneficiaries, those not collecting Social Security, dual eligible individuals who’s premium is paid by Medicaid or beneficiaries who pay an additional income-related premium
n Deductibles
n Coinsurance or copayments
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Understanding Medicare
+Medicare – Enrollment
n Apply 3 months before age 65n Do not need to be retired*
n *Benefits through employer or retirement plans?
n Social Security Administration (SSA) will enroll you in Medicare starting the first day of the month (upon meeting requirements)
n Might not want to enroll in all parts of Medicare
n See your benefits administrator to see if there are restrictions and/or requirements
n Auto Enrollmentn If you are already receiving Social Security benefit
n If receiving Railroad Retirement benefits
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Understanding Medicare
+Medicare Part A – Hospital Coverage
n Part A premium is free for most people
n People with less than 10 years of Medicare-covered employment can pay a premium to get Part A
n Coveragen Hospital inpatient care, skilled nursing facility (SNF) care, home health care,
hospice care, and blood work.
n Charges based on “benefit period”n Inpatient hospital care and SNF servicesn Begins day admitted to hospital and ends when no care received in a
hospital or SNF for 60 days in a row.n You pay deductible for each benefit period, but there is no limit to number
of benefit periods
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Understanding Medicare
+Paying for Hospital Stays
n For inpatient Hospital stays in 2016 you payn $1,288 total deductible for days 1 – 60
n $322 co-payment per day for days 61 – 90
n $644 co-payment per day for days 91 – 150(60 lifetime reserve days)
n All costs for each day beyond 150 days
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Understanding Medicare
+Medicare Part B - Medical Coverage
Enrollment in Part B is your choice
n Initial Enrollment Period (IEP)n 7 months beginning 3 months before age 65
n Enrolled automatically if receiving Social Securityn To keep Part B, keep the card
n If you don’t want Part B, follow instructions with card
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Understanding Medicare
+Medicare Part B - Enrollmentn General Enrollment Period (GEP)
n January 1 through March 31 each yearn Coverage effective July 1n Premium increases 10% for each 12-month period you were eligible
but did not enroll
n Special Enrollment Periodn You have a Special Enrollment Period to sign up for Part A and/or
Part B any time as long as 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.
n You also have an 8-month Special Enrollment Period to sign up for Part A and/or Part B that starts 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.
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Understanding Medicare
+Medicare Part B - Paying the Premium
n Taken out of your monthly paymentn Social Securityn Railroad Retirementn Federal Government retirement
n OR May be billed every 3 months
n Programs available to help
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Understanding Medicare
+Medicare Part B - Paying the Premium
IRMAA 2016
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Yearly Income FiledIndividual Tax Return (2014)
File Joint Tax Return (2014)
Premium (2016)
$85,000 or less $170,000 or less $121.80
$85,001-$107,000 $170,001-$214,000 $170.50
$107,001-$160,000 $214,001-$320,000 $243.60
$160,001-$214,000 $320,001-$428,000 $316.70
$214,001 or more $428,001 or more $389.80
Updated 11/13/15 AMS
Understanding Medicare
+Medicare Part B 2017
Projected
� 2017 Projected Part B Costs¡ As of June 2016, Social Security projects a Cost of Living
Adjustment (“COLA”) of .2%¡ Those who are not “held harmless” i.e. those who are new to
Medicare, not having Part B premiums taken directly from Social Security check, or those effected by IRMAA may expect Part B premiums to be $149.00/month ($27.20 more than 2016)
¡ Those who are “held harmless” may expect to pay $107.60/month ($2.70 more than 2016)
¡ Part B Deductible may be $204 ($38.00 more than 2016)¡ Final numbers should be available in November
Updated 11/13/15 AMS
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Understanding Medicare
+Medicare Part B - Coverage
n Doctors’ services
n Outpatient medical and surgical services and supplies
n Diagnostic tests
n Outpatient therapy
n Outpatient mental health services
n Some preventive health care services
n Advanced Directives Counseling (new in 2016)
n Other medical services
n Clinical laboratory tests
n Home health services (not covered under Part A)
n Durable medical equipment
n Outpatient hospital services
n Blood Work
n Ambulance service, if other transportation would endanger your health
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Understanding Medicare
+Medicare Part B – Cost of Services
n In Original Medicare you payn Yearly deductible
n $166 in 2016n 80% covered by Medicare, 20% co-pays for most services
n Some co-payments
n Programs available to help pay Part B costs
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Understanding Medicare
+Medigap - Overview
n Health insurance policies
n Sold by private insurance companies, plans are A through N
n Plans are Standardized from company to company
n Follow Federal and State laws that protect you in every state
n Must say “Medicare Supplement Insurance”
n Cover “gaps” in Original Medicare
n Costs and availability may vary by state, you must purchase a plan where you live
n Does not include a drug plan benefit
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Understanding Medicare
+Medigap – How It Works
n Only works with Original Medicaren Don’t need Medigap if in MA Plan or other
Medicare plans
n Can go to any doctor, hospital, or provider that accepts Medicaren Except with a Medicare SELECT policy
n You pay a monthly premium to the insurance company
n All Medigap plans must be approved by the IDOI
n A list of all Medigap plans is located on the SHIP website (or via packet in the mail)
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Understanding Medicare
+Medigap Plans-Enrollment
n When you need coverage
n Guaranteed Issue Period
n Other Enrollment Possibilities
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Understanding Medicare
+Medicare Part D – Rx Coverage
n Available for all people with Medicare
n Requirements:
n Have Medicare Part A, Part B, or both
n Live in plan service area
n Enroll in a Medicare prescription drug plan
n Provided through
n Medicare Prescription Drug Plans
n Medicare Advantage Plans
n Assistance Plans
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Understanding Medicare
+Medicare Part D – Costs in 2016
n Costs vary by plan, most people will pay: n Monthly premiumn Annual Deductible, $360 in 2016n After the deductible for the next $3,310, you will pay 25% and the plan
will cover 75% of your drug costs. n When your total drug costs reach $3,310, your initial drug plan
coverage will end. n Part D enrollees will pay 45% of the total cost of their brand-name
drugs and pay a maximum of 58% co-pay on generic drugs while in the donut hole. The full retail cost of the drugs will still apply to getting out of the donut hole.
n Once your total out of pocket drug costs (not including the monthly premiums) reach $4,850 your catastrophic coverage will begin.
n Your plan will cover up to 95% of your drug costs. You will pay either $2.95 for generic or $7.40 for brand name drugs or 5% of the cost which ever is greater.
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Understanding Medicare
+Part D Costs
Projected
� Part D expenses ¡ 2017 Part D Premium [National Average]- $35.63
÷ This means: This is the national average premium for a standard Part D policy. This will be used to calculate a late penalty, if applicable
¡ 2017 Deductible-$400 ($40 more than 2016)÷ This means: If you enroll in a Medicare Part D plan with a standard
initial deductible, you will pay $400 before your drug plan will begin sharing costs
¡ 2017 Initial Coverage Limit- $3,700 ($390 more than 2016)÷ Initial Coverage Limit is the amount of money beneficiaries and their
Part D plan will pay before the beneficiary reaches the Donut Hole÷ This means: Beneficiaries will be able to buy slightly more medications
before reaching the 2017 Donut Hole.÷ Note: If a beneficiary pays less than $309/month for medications, that
beneficiary will not enter the Donut Hole
Updated 11/13/15 AMS
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Understanding Medicare
+Part D Cost Continued
� Part D expenses ¡ 2017 Total Out-of-Pocket Costs (TrOOP)- $4,950 ($100 more than
2016)÷ This means: A beneficiary will have to spend $4,950 to get out of
the Donut Hole¡ 2017 Generic Drug Discount- 49% (7% more than 2016)
÷ This means: If a beneficiary reaches the Donut Hole and has a generic medication has a retail cost of $100, the beneficiary will pay $51
¡ 2017 Brand Name Drug Discount- 60% (5% more than 2016)÷ This means: If a beneficiary reaches the Donut Hole and has a
brand name medication that has a retail cost of $100, the beneficiary will pay $40
Updated 11/13/15 AMS
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Understanding Medicare
+Medicare Part D – Making Changes
n Annual Election Period
n Special Enrollment Periodsn Permanently move out of plan service arean Lose creditable prescription drug coverage n Enter, reside in, or leave a long-term care facility
n Like a nursing homen Qualify for Extra Helpn Have other exceptional circumstances
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Understanding Medicare
+Medicare Part D - Enrollment
n When first eligible for Medicaren 7 months beginning 3 months before first month
of Medicare eligibility
n During specific enrollment periodsn Annual Coordinated Election Period
n October 15th – December 7th each year
n Special Enrollment Periods
n Some people are enrolled automatically
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Understanding Medicare
+Late Enrollment Surcharges/Penalties
n The late enrollment penalty is calculated by multiplying 1% of the national base beneficiary premium ($34.10 in 2016) 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.
n This amount is rounded to the nearest $.10 and added to your monthly premium. You may have to pay this penalty for as long as you have a Medicare drug plan.
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Understanding Medicare
+Medicare Part D Premium
IRMAA 2016
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Yearly Income FiledIndividual Tax Return (2014)
File Joint Tax Return (2014)
Premium (2016)
$85,000 or less $170,000 or less your plan premium
$85,001-$107,000 $170,001-$214,000$12.70 + your plan
premium
$107,001-$160,000 $214,001-$320,000$32.80 + your plan
premium
$160,001-$214,000 $320,001-$428,000$52.80 + your plan
premium
$214,001 or more $428,001 or more$72.90 + your plan
premium
Updated 11/13/15 AMS
Understanding Medicare
+Medicare Advantage Plans - Overview
n Health plan options approved by Medicare n A way to get your Medicare benefits delivered through private
companies approved by Medicare n Still in Medicare programn Still have Medicare rights and protectionsn Still get regular Medicare-covered servicesn May get extra benefits
n Such as vision, hearing, or dental caren May be able to get prescription drug coverage (Part D)
n Different Advantage Plansn Health Maintenance Organization (HMO)n Preferred Provider Organization (PPO)n Private Fee-for-Service (PFFS)n Special Needs Plan (SNP)
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Understanding Medicare
+Part D Prescriber Enrollment
New for 2016
n Effective June 1, 2016
n All physicians and other eligible professionals who prescribe Part D drugs are required to be validly enrolled in the Medicare program.
n Part D plans will deny a pharmacy claim at point of sale for drugs prescribed by physicians or other eligible professionals who are not enrolled in Medicare.
n Applies to all physicians, dentist and other eligible professionals that write Part D prescriptions.
Updated 11/13/15 AMS
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Understanding Medicare
+Advantage Plans – Join and Switch
n Initial Coverage Election Periodn Seven month period begins three months before you turn 65
n Includes the month you turn 65
n Ends 3 months after you turn 65
n Annual Election Periodn October 15th – December 7th each year
n Coverage starts January first of next year
n Annual Disenrollment Periodn January 1st – February 14th every year (coverage begins the first of
the month after you switch)
n May also join a Medicare Part D plan during change
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Understanding Medicare
+Advantage Plans – How They Work
n Get Medicare-covered services through the plan, all of Part A and Part B covered services
n Some Plans may provide additional benefits
n Can include a prescription drug coverage
n You may have to stay in a certain network of hospitals and providers
n Co-pays and deductible are different than Original Medicare
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Understanding Medicare
+Medicare & HSAs
n The Social Security Administration (SSA) determines the month your Medicare begins. If you apply for Medicare Part A or Social Security benefits after you attain age 65, your Medicare Part A coverage will begin retroactively up to six months prior to your application month, but not before the month you attained the age of 65.
n You cannot contribute to your HSA once your Medicare coverage begins. If you contribute to your HSA after your Medicare coverage starts, you may have to pay a tax penalty and repay employer contributions. If you’d like to continue contributing to your HSA, you should not apply for Medicare, Social Security, or Railroad Retirement Board benefits.
n You can withdraw money from your HSA after you enroll in Medicare to help pay for medical expenses (like deductibles, premiums, coinsurance or copayments).
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Understanding Medicare
+THE RECAP
n If you want and are eligible for Medicare:Ø Decide if you want only Original Medicare OR
Original Medicare plus a Supplement/Gap Plan OR a Medicare Advantage Plan
Ø Decide on a Prescription Drug Plan
Ø Investigate Policies and CompaniesØ Choose a reasonable number of the above and
contact companies for personal quotes.
Ø ENROLL!Ø Receive the benefits for which you’ve paid!
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Understanding Medicare
+For More Information
n 1-800-MEDICARE (1-800-633-4227)n TTY users should call 1-877-486-2048
n Medicare & You 2016 handbook
n Other Medicare publications
n www.medicare.gov
n www.cms.hhs.gov
n SHIP telephone: 1-800-452-4800n TTY users should call 1-800-846-0139
n SHIP website: www.medicare.in.gov
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