“Serving the senior market since 1982”. Source: CMS National Training Program Medicare 101 Introduction to Medicare Original Medicare Plan Medicare Supplement.

“Serving the senior market since 1982”

http://www.eldercarebroker.com/

Source: CMS National Training Program

Medicare 101

Introduction to Medicare Original Medicare Plan Medicare Supplement Insurance (Medigap) Medicare Advantage and other Medicare plans Medicare prescription drug coverage Medicaid and Medicare Savings Programs

Medicare was signed into law on July 30, 1965. In general, all persons 65 years of age or older are eligible for Medicare.Since then the primary benefits for Medicare have been Part A Hospital Insurance, and Part B for Medical Insurance.

Part A and Part B benefits have

remained fundamentally the same since 1965.

06-07-07 4

What Is Medicare?

A health insurance program forPeople 65 years of age and olderPeople under age 65 with certain disabilitiesPeople with End-Stage Renal Disease (ESRD)

Administered by Centers for Medicare & Medicaid Services (CMS)

Enrollment by Social Security Administration (SSA) or Railroad Retirement Board (RRB)

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Applying for Medicare

Apply 3 months before age 65Don’t have to be retiredContact the Social Security Administration

Enrollment automatic if receiving Social Security or Railroad Retirement benefits

Medicare

Medicare Basics

Part AHospital Insurance

Part BMedical Insurance

Prescription Drug Coverage (Part D)

Medicare Coverage Basics

Part A

Inpatient hospital care Skilled nursing care Home health care Hospice care

Part B

Doctors’ services and outpatient care Preventive services Diagnostic tests Some therapies Durable medical equipment

Part D Outpatient prescription drugs

Medicare Part A

Most people receive Part A premium free People with less than 10 years of Medicare-

covered employmentCan still get Part A

• Will pay a premium

For information about Part A entitlementCall SSA

• 1-800-772-1213• TTY users call 1-800-325-0778

Enrolling in Medicare Part B Pay monthly Part B premium

$99.90 in 2012 (higher consumers may pay more)

Initial Enrollment Period (IEP)7 months starting 3 months before month of

eligibility General Enrollment Period (GEP)

January 1 through March 31 each yearCoverage effective July 1Premium penalty

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

Enrolling in Medicare Part B

Some people can delay enrolling in Part B with no penaltyIf covered under employer or union group

health plan• Based on current employment

– Person or spouse

• Will get a Special Enrollment Period (SEP)– Sign up within 8 months after coverage ends

Paying the Part B Premium

Taken out of monthly paymentsSocial SecurityRailroad retirementFederal government retirement

For information about premiumsCall SSA, RRB, or Office of Personnel Management

If no monthly paymentsBilled every 3 monthsMedicare Easy Pay

Medicare Choices

Original Medicare PlanMedicare Advantage PlansOther Medicare PlansMedicare Prescription Drug Plans

Original Medicare Plan Go to any health care provider that accepts Medicare People are responsible for

Part A• $1156 deductible in 2012 for hospital stays up to 60

days– Additional costs after 60 days

• Different costs for other Part A servicesPart B

• $140 annual deductible in 2012• 20% coinsurance or copayment for most Part B services

Some programs may help with costs

Original Medicare

06-07-07 14

The Medicare Card

Jane Doe

Original Medicare

Medigap

Health insurance policySold by private insurance companiesMust say “Medicare Supplement Insurance”Covers “gaps” in the Original Medicare Plan

• Deductibles, coinsurance, copayments• Does not work with Medicare Advantage Plans

Up to 12 standardized plans A – L• Except in Massachusetts, Minnesota, Wisconsin• So people can compare easily

Medigap

How Medigap WorksPeople can buy a Medigap policy

Within 6 months of enrolling in Part B• Must be age 65 or older

If they lose certain kinds of health coverage• Through no fault of their own

If they leave MA Plan under certain circumstancesWhenever the company will sell them one

Monthly premiumGenerally go to any doctor or specialist

Medigap

Medigap (Medicare Supplement Insurance) Policies

Part A – What You Pay in Original Medicare – 2012

Hospital Inpatient Stay

$1,156 deductible and no coinsurance for days 1–60 each benefit period

$289 per day for days 61–90 each benefit period $578 per “lifetime reserve day” after day 90 of each

benefit period (up to 60 days over your lifetime) All costs for each day after the lifetime reserve days Inpatient mental health care in a psychiatric hospital

limited to 190 days in a lifetime

Skilled Nursing Facility Stay

$0 for the first 20 days each benefit period $144.50 per day for days 21–100 each benefit period All costs for each day after day 100 in a benefit period


Part A – What You Pay in Original Medicare – 2012

Home Health Care

$0 for home health care services 20% of the Medicare-approved amount

for durable medical equipment


Part A – What You Payin Original Medicare – 2012

Hospice Care

$0 for hospice care A copayment of up to $5 per prescription for covered

outpatient prescription drugs for symptom control or pain relief

5% of the Medicare-approved amount for inpatient respite care (short-term care given by another caregiver so the usual caregiver can rest)

All costs for room and board for hospice care in your home or another facility where you live (like a nursing home).

Blood If the hospital buys the blood, you must either pay the hospital costs for the first 3 units you get in a calendar year or have the blood donated. Otherwise, no cost.

04/02/2012 Medigap (Medicare Supplement Insurance) Policies

20

Part B – What You Pay in Original Medicare – 2012

Coinsurance for Part B Services

20% coinsurance for most covered services, like doctor’s services and some preventive services, if provider accepts assignment

$0 for some preventive services 40% coinsurance for outpatient

mental health (35% in 2013, and 20% in 2014)

Copayments for hospital outpatient services

Medigap BenefitsMedigap Plans

A B C D F* G K** L** M N

Part A Coinsurance

Part B Coinsurance

Skilled Nursing Coinsurance

Part A Deductible Part B Deductible Part B Excess Charges


21

*Plan F has a high-deductible option.

Medigap Key Points

Generally must have Medicare Parts A and B You pay a monthly premium for Medigap You pay the Medicare Part B premium Spouses must buy a separate policy Costs vary by plan and by company Do not work with Medicare Advantage Plans


When to Buy a Medigap Policy

May be able to buy a Medigap policy any time• If insurance company will sell you one

Medigap open enrollment period (OEP)• 6-months when insurance company must sell• Your one OEP begins when you are 65 or older

and enrolled in Part B Can’t be changed or replaced

• Some states have more generous rules


Open Enrollment Period (OEP)

Best time to buy because companies can’t• Refuse to sell any Medigap policy they sell• Delay coverage (exception below)• Charge more for past/present health problem

Companies can delay coverage for• Pre-existing condition w/o creditable coverage

Policies sold after 1992 guaranteed renewable


Delayed Medigap Open Enrollment Period

If you delay enrolling in Part B• Because you or your spouse is still working and• You have group health coverage

Medigap open enrollment period is delayed• Until you are 65 and are enrolled in Part B• No late enrollment penalty

Notify Social Security to delay Part B


How Much does Medigap Cost?

Cost (monthly premium) depends on • Your age (in some states)• Where you live (e.g., urban, rural, or ZIP Code)• Company selling the policy• Discounts (female, non-smokers, married couples)• Medical underwriting

Premiums vary greatly for same Medigap plan


Medigap Pricing Based on Age

04/02/2012 Medigap (Medicare Supplement Insurance) Policies 27

No-age-rated(community-rated)

Everyone pays same regardless of age if 65 or older

Generally least expensive over lifetime

Issue-age-rated Based on age when purchasedDoesn’t go up automatically as you get older

Attained-age-rated

Premium based on current ageGoes up automatically as you get olderCosts less when you are 65Cost goes up each year as you get older

Not all states allow all three types of rating

Buying a Medigap Policy

An important decision – shop carefully Four steps

1. Decide which Plan A – N meets your needs2. Locate companies selling Medigap in your state3. Call the companies and compare costs4. Buy the Medigap policy


What are Standardized Plans?

Plans identified by a letter• Plans A, B, C, D, F, G, K, L, M, N are currently sold• Companies don’t have to sell all plans• Plans E, H, I, J exist but are no longer sold

Waiver states have non-standardized plans• Massachusetts• Minnesota• Wisconsin


Rules for Standardized Plans

Each plan with the same letter must offer same basic benefits• For instance, all Medigap Plan A policies

Offer the same benefits Only the policy cost will vary between companies

You pay the Medigap premium You must still pay Part B premium


04/02/2012 Medigap (Medicare Supplement Insurance) Policies 31

** Plans K and L have out-of-pocket limits of $4,660 and $2,330 respectively

Medigap BenefitsMedigap Plans

A B C D F* G K** L** M NPart A Coinsurance up to an addition 365 days

Part B Coinsurance 50% 75% Blood 50% 75% Hospice Care Coinsurance 50% 75% Skilled Nursing Coinsurance 50% 75% Part A Deductible 50% 75% 50% Part B Deductible

Part B Excess Charges

Foreign Travel Emergency (Up to Plan Limits)

*Plan F has a high-deductible plan *** Plan N pays 100% Part B coinsurance with copay up to $20/$50 for emergency room visits not resulting in inpatient

Out-of-Pocket Limit**

$4,660 $2,330

Medicare Advantage Plans

Health Maintenance Organization (HMO) PlansSome have Point-of-Service option

Preferred Provider Organization (PPO) PlansRegional PPOs & Local PPOs

Private Fee-for-Service (PFFS) Plans Special Needs Plans Medicare Medical Savings Account (MSA) Plans

New in 2007

Medicare Advantage and Other Medicare Plans

Eligibility for MA Plans

Live in plan’s service areaEntitled to Medicare Part AEnrolled in Medicare Part B

Continue to pay Part B premiumMay also pay monthly premium to plan

Don’t have ESRD at enrollmentSome exceptions


How MA Plans Work

Usually get all Part A and B services through planMay have to use providers in plan’s networkGenerally must still pay Part B premium

• Some plans may pay all or part May get extra benefits

Vision, hearing, dental servicesPrescription drug coverage

Still in Medicare programGet all Part A and Part B servicesHave Medicare rights and protections


Medicare Prescription Drug Coverage

Coverage began January 1, 2006Available to all people with Medicare Provided through

Medicare Prescription Drug PlansMedicare Advantage and other Medicare plansSome employers and unions

Medicare Drug Coverage

Enrollment Periods

Initial Enrollment Period (IEP)7 monthsStarts 3 months before month of eligibility

Annual Coordinated Election Period (AEP)November 15 through December 31 each yearCan join, drop, or switch coverage

• Effective January 1 of following year

Special Enrollment Period (SEP)


Late Enrollment

People who wait to enroll may pay penaltyAdditional 1% of national base premium for

every month eligible but not enrolledMust pay the penalty as long as enrolled in a

Medicare drug planUnless they have other coverage at least

as good as Medicare drug coverage“Creditable coverage”


Prescription Drug Plans

At a minimum, must offer standard benefitIn 2007 members may pay

• Monthly premiums• Annual deductible, no more than $265• Copayments or coinsurance• Very little after $3,850 out-of-pocket

May offer supplemental benefits Plan information and costs available

www.medicare.gov1-800-MEDICARE (1-800-633-4227)


Extra Help With Drug Costs

Available for many people with limited income and resourcesIncome limit in 2007

• $1,276/month individual)• $1,711/month (married couple)

Resource limit• $11,710 (individual)• $23,410 (married couple)


Extra Help With Drug Costs

People with lowest income and resourcesPay no premiums or deductiblesHave small or no copayments

Those with slightly higher income and resourcesPay no or a reduced premiumHave a reduced deductiblePay a little more out of pocket


Eligibility for Extra Help

Some people may automatically qualifyPeople with Medicare who

• Get full Medicaid benefits• Get Supplemental Security Income (SSI)• Get help from Medicaid paying Medicare premiums

Others must apply and qualify


Medicaid

Joint Federal and state programFor some people with limited income and resources

If eligible, most health care costs covered Eligibility determined by state Application processes vary Office names vary

Social ServicesPublic AssistanceHuman Services

Medicaid and Medicare Savings Programs

For More Information

1-800-MEDICARE (1-800-633-4227)TTY users call 1-877-486-2048

www.medicare.gov www.cms.hhs.gov State Health Insurance Assistance

Program (SHIP) Medicare & You handbook

Other publications

This training module is provided by the

For questions about training products, e-mail [email protected]

To view all available NMTP materials or to subscribe to our listserv, visit

www.cms.gov/NationalMedicareTrainingProgram

mailto:%[email protected]

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“Serving the senior market since 1982”. Source: CMS National Training Program Medicare 101 Introduction to Medicare Original Medicare Plan Medicare Supplement.

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