An overview of MedicareMEDICARE 101

What is Medicare?

Medicare is health insurance for thefollowing people:

People who are 65 years of age and olderPeople under 65 with certain disabilitiesPeople with End-Stage Renal disease

When do you sign up for Medicare?

Open enrollment for Medicare is a 7 month period, the three months before your birthday, the month of your birthday and three months after your birthday. If you delay signing up after your birthday, your effective dated will be delayed.

How do you sign up?

You can call Social Security at 1-800-772-1213 anytime during your open enrollment period to sign up.

Sometimes Medicare will automatically send you your card. If you delay signing up because you are covered under a group health plan, you will not incur a penalty.

If you delay signing up and you are not covered by a group health plan then you could be penalized. Late sign up is from Jan 1-March 31 with an effective date of July 1

of the same year.

There are four parts to Medicare:

A- HospitalB- MedicalC- Medicare Advantage PlansD- Prescription Drug Plans

(A and B are original Medicare)

Medicare A (Hospital)

Covers in-patient hospital, skilled nursing, HospiceNo premium if you or spouse have worked 40 quarters. If not you can purchase it for a monthly premium of $461in 2010.

Coverage for hospital semi-private room rateHome care: medically necessary part-time, intermittent skilled nursing care, PT, SP, OT, home health aide services, medical supplies for use at home.

Medicare B (Medical)

Covers medically necessary expenses: medical, doctors, labs, x-rays, therapies (speech, occupational, physical), out patient surgery, some part B drugs

Medicare B (Medical)continued

You must pay a premium for this coverage. There is a base premium and then additional premium is charged according to your 1040 income. (Based on modified adjusted gross income from 2 years ago). You can request a reevaluation of this premium if you disagree.

Medicare B (Medical)continued

Some covered expenses include: ambulance, surgical centers, blood, bone density tests, cardiac rehab, cardiovascular screening, some chiropractic, lab, cancer screening, diabetes screening and equipment, durable medical equipment like walkers, oxygen supplies, diabetic supplies, emergency room, flu shots, foot exams, glaucoma tests, hearing and balance exams, hepatitis B shot, home health kidney dialysis, mammograms, mental health care, occupational therapy, pap and pelvic exams, annual physicals, transplants

Not covered by Medicare A or B

Custodial Long Term CareDentures

Cosmetic SurgeryAcupunctureHearing Aids

Routine Dental Care

Medicare C(Medicare Advantage and Medicare Advantage

Prescription Drug Plans)

Benefits provided by private companies

Typically low or no monthly premiums

Must keep Medicare A and B in force

Provide all the benefits of Medicare A and B and some value added benefits

Some plans have drug coverage

Plans include PPO, HMO, PFFS, SNP's, HMO, Point-of-Service, MSA (Medical Savings Accounts)

Guaranteed issue

Have specific enrollment periods

Medicare C Plans

HMO- Health Maintenance Organization. Must go to Network or contracted providers, small or no premium, must have referrals, value added benefits

PPO-Preferred Provider Organization. Benefits in and out of network, no referrals, out of net work more expensive. Small or no premium

Medicare C Planscontinued

PFFS- Private-fee-for-service- Can go to any provider that accepts the plans payment. No contracting, per visit basis

HMOPOS, An HMO that may allow you to get some services out-of-network for a higher cost

MSA- Medical Savings Account Plans- a plan that combines a high deductible health plan with a bank account.

Who can join aMedicare C plan?

You have Medicare part A and Part B

You live in the service area of the plan

-Stage Renal Disease (ESRD) (permanent kidney failure requiring dialysis or a kidney transplant)

Can join only at certain times of the year

If you join a Medicare plan and you had employer or union coverage you may not be able to get it back

Medicare Part D(Prescription Drug Coverage)

Benefits designed to help with the cost of prescription drugs

Benefits provided by private companies

Plans have a monthly premium and same basic structure, some have a deductible, all have initial coverage, coverage gap and catastrophic coverage

Stand alone plans and those in MAPD's are the same

Enrollment periods

Covers approximately half the cost of meds

Must have Medicare A and/or B

Caution, if you have employer or union coverage, by enrolling in these plans, you may lose your other coverage

Medicare Part D specifics

Plans have deductible of up to $310 in 2011

Pay co-pays and plan pays its share for covered drugs until their combined amount plus the deductible reaches $2,840 (initial coverage limit)

Coverage gap, in 2011, receive a 50% discount on covered brand-name drugs that count as out-of-pocket spending

Once spent $4,550 out-of-pocket for the year, coverage gap ends. Now pay small co-pays for each drug until end of year

Medicare Part D specificscontinued

Plans use a formulary, specific Medicare prescription drugs

Plans have certain rules to control costs and quality: Quantity limits, Step therapy, Prior Authorization

Plans change annually, sometimes formularies change during the year

Specific enrollment periods, 2011, October 15th to December 7th. For changing and enrolling in plans unless aging in and leaving group coverage

Clarifications of terms for Part D

Standard Benefits for Part D include: Formulary, Catastrophic Coverage, Deductible, Coverage Gap

Total Out-of-Pocket drug costs: Amount consumer pays for RX drugs, from 1/1, not including premiums, but includes deductible, co-pays/coinsurance, coverage gap drug costs

Definition of Formulary: A list of the drugs that are covered by the plan

Formulary Exception Request: Request for the plan to cover a medication that is not included in the formulary

Clarifications of terms for Part Dcontinued

Quantity Limits: Plan will only cover a certain amount of these drugs for one co-pay, limits may be placed to ensure safe and efficient use of a drug.

Step therapy: Effective, clinically proven, lower-cost alternative to some drugs that a plan wants a member to try first. If a member has already tried other drugs or a provider thinks

the Plan to cover these drugs.

Prior Authorization: Some Drugs require approval by the Plan prior to a member receiving the drug.

Part D Enrollment Basics

Member must keep Medicare A and or B in force

Member can only be enrolled in one Medicare health plan and enrollment into a MA will automatically disenroll them from any other Medicare health plan and prescription drug plan

Members have certain rights, guaranteed, be treated with dignity and respect, be protected from discrimination, have questions answered, receive information, receive emergency care, rights to appeal decisions, can file complaints, have their personal and health information kept private

Do your homework!

Extra Help for paying for prescription drugs

Help is available for some people with limited income and resources

Single person-income less then $16,245 and resources less than $12,510

Married person-income less than $21,855 and resources less than $25,010

May receive help with drug plan's monthly premium, yearly deductible, coinsurance and co-payments

No coverage gap

No late enrollment penalty

Automatically qualify for help if you have full Medicaid coverage, get SSI or Medicaid is paying your Part B premiums in a Medicare Savings Program

If you don't automatically qualify for Extra Help, you can apply to the agencies below:

www.socialsecurity.govSocial Security, 1-800-772-1213

State Medical Assistance (Medicaid) office 1-800-633-

State health insurance Assistance Program (SHIP)- call 1-800-MEDICARE

Most Common Medicare Enrollment Periods

AEP- Annual enrollment period for 2010, November 15-Decembder 31st, in 2011, October 15, 2011 to December 7, 2011. Change Drug and Medicare C plans

No OEP, now MAPD Medicare Advantage Disenrollment Period from Jan 1-return to original Medicare and pick up a stand-alone drug plan.

SEP, Special Enrollment Period- Occurs anytime during year for people aging into Medicare, losing group coverage, moving out of service area, qualifying or disqualifying for Medicaid, moving into or out of long term care facility, etc

Medicare Supplements

Sold by private companies but government has designed plans, A-N

Have varied monthly premiums but all have the same coverage for the same plans

Covers the co-pays, deductibles and coinsurance of Medicare

Can use any Medicare provider

Only covers Medicare expenses

Can be used in all states

Only guaranteed issue at certain times: aging in to Medicare, leaving group or union coverage, plan leaving service area

How Medicare Supplements work (plan F shown below)

Hospital benefit

Nursing home benefit (first 100 days only with Medicare)

Medical part B- $155 annual deductible

20% coinsurance under B

Part B excess

Foreign Travel Emergency

Out of pocket costs for most part A and part B expenses

Deductible paid by Supplement for each benefit period

Balance paid by supplement

Paid by Supplement

Paid by Supplement

Paid by Supplement

$250 deductible, 20% to $50,000

$0- for Medicare expenses and a Medicare provider

Medicare Decision tree:Choose one side only

Original Medicare A

+

Original Medicare B

+

Prescription Drug plan, Medicare D

+

Medicare Supplement

Monthly premium over $100

No networks or referrals

Any Medicare provider

No co-pays, deductibles, co-insurance

Medicare Advantage Prescription Drug Plan

Premiums $0- under $100/month

Networks, co-pays, deductibles, co-insurance

Maximum out of pocket

Enrollment periods

change annually

Frequently Asked Questions about Medicare

Q: If I am working, do I need to sign up for Medicare, and will I incur a penalty if I don't?

A: Depends on each individual situation, but as long as you have credible coverage you do not incur a penalty.

Frequently Asked Questions about Medicare

Q: Why am I having to pay the full cost of my drugs, I was only paying a small amount all year?

A: You have probably reached the coverage gap and the coverage changes. You will pay 50% of the cost of covered Brand drugs and 93% of the cost of most generics until you have spend $4,500 out of pocket.

Frequently Asked Questions about Medicare

Q: How do I switch and change plans or join a plan?

A: Some insurance agents have gone through certification with CMS and they may assist you, or you can call Medicare or call the plans directly.

Frequently Asked Questions about Medicarecontinued

Q: How do I decide whether to leave the group and go on Medicare?

A: You should have an analysis done by an insurance broker who has gone through CMS certifications with Medicare contracted private insurance companies who can assist you in comparing the cost and benefits of the decision.

Frequently Asked Questions about Medicarecontinued

Q: How do I decide whether to take Medicare A, B, D and a supplement or choose a MAPD?

A: Your Medicare decision depends on your preferences, your ability to pay a premium, and your choices for health care providers. For example, if you want complete freedom to choose your providers and you can afford the premium, then you should select a Medicare Supplement. If you cannot afford the higher premium and you are not as concerned about provider choice, choose a MAPD.