Understanding Medicare

Understanding Medicare

Module 1

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Lessons

1. Medicare Basics (Part A and Part B)

2. Original Medicare Plan

3. Medicare Advantage Plans (Part C) and other Medicare plans

4. Medicare prescription drug coverage (Part D)

5. Programs for people with limited income and resources

Medicare Basics

Module 1: Lesson 1

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Medicare BasicsLesson 1 Topics

Medicare overviewEnrollmentPart APart BMedicare plan choices

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Medicare Health insurance for people

Age 65 and olderUnder age 65 with certain disabilitiesAny age with End-Stage Renal Disease (ESRD)

Administered byCenters for Medicare & Medicaid Services (CMS)

Enroll throughSocial Security Administration (SSA) orRailroad Retirement Board (RRB)

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MedicareMedicare has

Part A – Hospital coveragePart B – Medical coveragePart C – Medicare Advantage Plans (like

HMOs and PPOs)Part D – Prescription drug coverage

You have choices in how you get your Medicare health and drug coverage

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Applying for Medicare

Apply 3 months before age 65Need not be retired

Automatically enrolled if receive Social Security or Railroad Retirement benefitsIf don’t already receive benefits, apply 3 months

before age 65• Call SSA at 1-800-772-1213

– TTY users call 1-800-325-0778

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Paying for Medicare Part A

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

covered employmentCan pay a premium to get Part A

For information, call SSA1-800-772-1213TTY users call 1-800-325-0778

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Enrolling in Medicare Part B

Initial Enrollment Period (IEP)7 months beginning 3 months before age 65

General Enrollment Period (GEP)January 1 through March 31 each yearCoverage effective July 1Premium increases 10% for each 12-month

period you were eligible but did not enroll• Pay this penalty as long as you have Part B• Limited exceptions

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Enrolling in Medicare Part B

Special Enrollment PeriodSign up within 8 months of the end of employer

or union health plan coverageNo increased premium

For questions or to enrollSSA: 1-800-772-1213RRB: 1-800-808-0772

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Paying for Medicare Part B Monthly Medicare Part B premium in 2007

Most people pay $93.50Programs available to help

If Your Yearly Income is You pay

File Individual Tax Return File Joint Tax Return

$80,000 or less $160,000 or less $93.50

$80-001-$100,000 $160,001-$200,000 $105.80

$100,001-$150,000 $200,000-$300,000 $124.40

$150,001-$200,000 $300,001-$400,000 $142.90

Above $200,000 Above $400,000 $161.40

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Paying the Part B Premium

Taken out of your monthly paymentSocial SecurityRailroad RetirementFederal Government retirement

For information about premiumsCall SSA or RRB

• Office of Personnel Management if a retired Federal employee

May be billed every 3 months Medicare Easy Pay

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Part A Helps Pay for

Hospital inpatient careSkilled nursing facility (SNF) careHome health careHospice careBlood

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Hospital Stays

Covered servicesSemi-private roomMealsGeneral nursingOther hospital services and supplies

Includes care in critical access hospitals190 days in a lifetime for inpatient mental

health care

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Skilled Nursing Facility Care

Must meet all of the following conditionsRequire daily skilled servicesHospital inpatient at least 3 consecutive days Admitted to SNF within 30 days after leaving

hospitalCare is for a condition treated in the hospitalMUST be Medicare participating SNF

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Skilled Nursing Facility Coverage

Semi-private room Meals Skilled nursing care Physical, occupational, and speech-language therapy Medical social services Medications, medical supplies/equipment Ambulance transportation Dietary counseling

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Home Health Care

Covered servicesPart-time skilled nursing careTherapy

• Occupational

• Physical

• Speech-languageSome home health aide servicesDurable medical equipment

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Home Health Care

For as long as you are eligibleLimited hours per dayLimited days per week

Four conditionsDoctor must make a plan for your care at homeMust need specific skilled servicesMust be homeboundHome health agency must be Medicare-approved

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Hospice

Special care for terminally illAnd family

If you likely have less than 6 months to liveCertification required for each “period of care”

Two 90-day periodsUnlimited 60-day periods

Hospice provider must be Medicare-approved

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Covered Hospice Services

Medical equipment and supplies Drugs for symptom control and pain relief Respite care in a Medicare-certified facility

Up to 5 days each timeNo limit to number of times

Home health aide and homemaker services Social worker services Dietary counseling Grief counseling

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Part B Helps Pay for

Doctors’ services Outpatient medical and surgical services and supplies Diagnostic tests Outpatient therapy Outpatient mental health services Some preventive health care services Other medical services

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Covered Preventive Services

“Welcome to Medicare” physical exam

Abdominal aortic aneurysm screening

Bone mass measurement Cardiovascular screenings Colorectal cancer

screenings Diabetes screenings Glaucoma tests

Mammograms (screening) Pap test/pelvic exam/

clinical breast exam Prostate cancer screening Flu shots Pneumococcal shots Hepatitis B shots Smoking cessation

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Part B Also Helps Pay for

Clinical laboratory testsHome health servicesDurable medical equipmentOutpatient hospital servicesBlood Ambulance service

If other transportation would endanger your health

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Medicare Plan Choices

Original Medicare PlanMedicare Advantage PlansOther Medicare plansMedicare drug plans

Medicare Prescription Drug PlansMedicare Advantage Plans and other Medicare

plans with prescription drug coverage

Original Medicare Plan

Module 1: Lesson 2

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Original Medicare PlanLesson 2 Topics

What it is and how it worksYour costs in Original Medicare PlanAssignmentMedigap (Medicare Supplement Insurance)

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Original Medicare Plan

Red, white, and blue Medicare cardPart A and/or Part BGo to any provider that accepts MedicareYou pay

Part B premium• Part A free for most people

DeductiblesCoinsurance or copayments

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Medicare Card (front)

Jane Doe

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Medicare Card (back)

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Medicare Claims Contractors

Fiscal Intermediary (FI)Regional Home Health Intermediary (RHHI)Medicare CarrierDurable Medical Equipment Regional Carrier

(DMERC)Medicare Administrative Contractors (MAC)

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Original Medicare Plan—Part A

Charges based on “benefit period”Inpatient hospital care and SNF servicesBegins day admitted to hospitalEnds when no care received in a hospital or

SNF for 60 days in a row You pay deductible for each benefit periodNo limit to number of benefit periods

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Paying for Hospital Stays

For inpatient stays in 2007 you payDays 1 – 60 each benefit period

• $992 totalDays 61 – 90 each benefit period

• $248 per dayDays 91 – 150 (60 lifetime reserve days)

• $496 per day All costs for each day beyond 150 days

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Skilled Nursing Facility Care

For each benefit period in 2007 you payDays 1 – 20: $0Days 21 – 100: $124 per dayAll costs after 100 days

Must meet requirements for Medicare-covered stayDoes NOT include custodial care

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Paying for Home Health Care

In the Original Medicare Plan you payNothing for covered home health care services20% of the Medicare-approved amount for

covered durable medical equipment

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Paying for Hospice Care

In the Original Medicare Plan you payUp to $5 for prescription drugs5% for inpatient respite care

• Amount can change each year

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Paying for Part B

In the Original Medicare Plan you payMonthly Part B premium

• $93.50 in 2007 for most peopleYearly deductible

• $131 in 200720% coinsurance for most servicesSome copayments

Some programs may help

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Assignment

Agreement between you, doctor, and MedicareApplies to Original Medicare Plan Part B Claims

If providers accept assignment they agree toBe paid by MedicareGet only the amount Medicare approves for their

servicesOnly charge the Medicare deductible and/or

coinsurance amount

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Assignment

Providers who don’t accept assignment mayCharge more than Medicare-approved amount

• Limit of 15% more for most services

Ask you to pay entire charge at time of service

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Assignment

In some cases, providers must accept assignmentSome examples

• Medicare Part B-covered prescription drugs

• Ambulance providers

Doctors/providers generally have to file claimYou may have to file your claim for Part B-covered

drugs or supplies• If supplier or pharmacy not enrolled in Medicare

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Private Contracts

Agreement between you and doctorOriginal Medicare Plan will not payMedigap will not payOther Medicare plans will not payYou will pay chargesNo claim should be submittedCannot be asked to sign in an emergency

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What Is Medigap? Health insurance policies

• Sold by private insurance companies• Follow Federal and state laws that protect you• Must say “Medicare Supplement Insurance”• Cover “gaps” in Original Medicare Plan • 12 standardized policies, plans A – L

• Except in Massachusetts, Minnesota, Wisconsin

• Costs may vary• By plan• By company• Where you live

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How Medigap Works

Only works with Original MedicareDon’t need Medigap policy in

• Medicare Advantage Plan

• Other Medicare plans

Can go to any doctor, hospital, or provider that accepts MedicareExcept with a Medigap SELECT policy

You pay a monthly premium

Medicare Advantage Plans and Other Medicare Plans

Module 1: Lesson 3

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Medicare Advantage PlansLesson 3 Topics

What are Medicare Advantage Plans and other Medicare plans

Who can joinHow plans workJoining and switching plans

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What Are Medicare Advantage Plans?

Health plan options approved by Medicare Run by private companies Part of the Medicare program

Sometimes called “Part C”

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Medicare Advantage Plans

Medicare Health Maintenance Organization (HMO)

Medicare Preferred Provider Organization (PPO)

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

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Other Medicare Plans

Medicare Cost PlansDemonstrations/Pilot ProgramsPrograms of All-inclusive Care for the

Elderly (PACE)

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Who Can Join?

Eligibility requirementsLive in plan’s service areaHave Medicare Part AHave Medicare Part BNot have ESRD at time of enrollment

• Some exceptions

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How Do Medicare Advantage Plans Work?

Generally get all Medicare-covered services through the plan

Can include prescription drug coverage May have to see certain doctors or go to certain

hospitals to get care Benefits and cost-sharing may be different from

those in Original Medicare Plan

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Out-of-Pocket Costs

Generally must still pay Part B premiumSome plans may pay all or part

May pay additional monthly premiumPay other out-of-pocket costs

Different from Original Medicare PlanVary from plan to plan

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In a Medicare Advantage Plan

Still in Medicare programStill have Medicare rights and protectionsStill get all regular Medicare-covered servicesMay get extra benefits

Such as vision, hearing, or dental care

May be able to get prescription drug coverage

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Medicare HMO Plans

Copayment amounts set by planGenerally must get care and services from

plan’s networkUse doctors and hospitals that join the plan May have to pay in full for care outside plan’s

network• Covered if emergency or urgently needed care

• Point-of-Service option allows visits to “out-of-network” providers

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Medicare HMO Plans (cont’d)

May need to choose primary care doctorUsually need a referral to see a specialistDoctors can join or leave

May get Medicare drug coverage

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Medicare PPO Plans

Can see any doctor or provider that accepts MedicareDon’t need referral to see specialistDon’t need referral to see out-of-network

provider Copayment amounts set by plan

• Will usually pay more for out-of-network care

May get Medicare drug coverage

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Medicare PFFS Plans Can see any Medicare-approved doctor or

hospital that accepts the planCan get services outside service areaDon’t need referral to see a specialistPlan sets copayment amounts

Can get emergency care anywhereWithout prior approval

If offered, can get Medicare prescription drug coverageIf not offered, can join a Medicare Prescription

Drug Plan

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Medicare MSA PlansNew in 2007Similar to Health Savings Account plansHave two parts

Medicare Advantage Plan with high deductible• Pays covered costs after you meet annual deductible

– Deductible varies by planMedical Savings Account

• Medicare deposits money the person may use– To pay health care costs

MSA demonstration available in some areas

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When Can You Join?

You can join a Medicare Advantage Plan or other Medicare planWhen first eligible for MedicareDuring specific enrollment periods

• Annual Coordinated Election Period

• Medicare Advantage Open Enrollment Period

• Special Enrollment Periods

• Limited Open Enrollment Period

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When Can You Switch?

Annual Election PeriodMedicare Advantage Open Enrollment PeriodSpecial circumstances

Move out of the plan’s service area and can’t stay in the plan

Plan leaves Medicare programOther special situations

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Annual Election Period

November 15 – December 31Can choose new plan

• Medicare Advantage Plan

• Medicare prescription drug plan

• Original Medicare PlanNew plan starts January 1

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Medicare AdvantageOpen Enrollment Period

January 1 – March 31, 2007Same period each yearChange effective first day of following monthCannot be used to start or stop Medicare

drug coverage

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Limited Open Enrollment Period

Only people in Original Medicare Plan Can join an MA-only plan

• Plan without Medicare prescription drug coverage

• During 2007 and 2008

Does NOT allow enrollment inMedicare Medical Savings Account (MSA) PlansMA plans that offer Medicare prescription drug

coverage (MA-PDs)Medicare Prescription Drug Plans (PDPs)

Medicare Prescription Drug Coverage

Module 1: Lesson 4

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Medicare Prescription Drug Coverage Lesson 4 Topics

OverviewEligibility and enrollmentExtra help

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Prescription Drug Coverage

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

Medicare Prescription Drug PlansMedicare Advantage Plans and other

Medicare plans

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Prescription Drug Costs

Costs vary by planMost people will pay

Monthly premiumDeductibleCopayments or coinsuranceVery little after $3,850 out-of-pocket in 2007

Extra help available for people with limited income and resources

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Eligibility and Enrollment

You mustHave Medicare Part A, Part B, or bothLive in plan’s service areaEnroll in a Medicare prescription drug plan to

get coverage

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Enrollment Periods

Initial Enrollment Period (IEP)7 months beginning 3 months before the first

month of Medicare eligibility

Can change plansAnnual Coordinated Election Period

• November 15 – December 31 each yearSome special enrollment periods available

Some people are enrolled automatically

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Late Enrollment Penalty

People who wait to enroll after their IEPPay additional 1% of base beneficiary premium

• For every month eligible and not enrolled

• For as long as they have Medicare drug coverageExcept those with other creditable drug coverage

• Coverage at least as good as Medicare prescription drug coverage

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Special Enrollment Periods

For people whoPermanently move out of plan’s service areaLose creditable prescription drug coverage Enter, reside in, or leave a long-term care facility

• Like a nursing homeHave Medicaid or are in a Medicare Savings

Program• Have a continuous special enrollment period

Have other exceptional circumstances

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Extra Help

Help with drug plan costs for people with limited income and resources

Eligibility determined by SSA or state Income and resources are counted Some groups are automatically eligible

People with Medicare and• Medicaid• Supplemental Security Income only• Medicare Savings Programs

Everyone else must apply

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Income and Resource Limits Income

Below 150% Federal poverty level• $1,276.25 per month for an individual* or• $1,711.25 per month for a married couple*• Based on family size

ResourcesUp to $11,710 (individual)Up to $23,410 (married couple)

• Includes $1,500/person funeral or burial expenses• Counts savings and stocks• Does not count home you live in

*Higher amounts for Alaska and Hawaii

2007 amounts

2007 amounts

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How to Apply for Extra Help

Multiple ways to applyPaper applicationwww.socialsecurity.govState Medical Assistance officeLocal organization

You or someone on your behalf can apply

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Drug Plan Costs for People with Extra Help

Those below Federal poverty level save over 95% on average

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

Those with slightly higher income and resourcesHave a reduced deductiblePay a little more out of pocket

Programs for People with Limited Income and Resources

Module 1: Lesson 5

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Programs for People with Limited Income and Resources

Lesson 5 TopicsMedicaidMedicare Savings Programs (MSP)Help for people living in U.S. territories

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Medicaid Federal-state health insurance program

People with limited income and resourcesCertain people with disabilities

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

Social ServicesPublic AssistanceHuman Services

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Medicare Savings Programs

Help from Medicaid paying Medicare premiumsFor people with limited income and resourcesMay also pay Medicare deductibles and

coinsurancePrograms include

• Qualified Medicare Beneficiary (QMB)

• Specified Low-income Medicare Beneficiary (SLMB)

• Qualifying Individual (QI)

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Programs in U.S. Territories

Help people pay their Medicare costsU.S. territories

Puerto RicoVirgin IslandsGuamNorthern Mariana IslandsAmerican Samoa

Programs vary Contact Medical Assistance office

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If you think you might qualify …

1. Review guidelines2. Collect your personal documents3. Get more information

Call your state Medical Assistance office Call your local State Health Insurance

Assistance Program (SHIP) Call your local Area Agency on Aging

4. Complete application with state Medical Assistance office

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Module 1 Lessons

1. Medicare Basics (Part A and Part B)

2. Original Medicare Plan

3. Medicare Advantage Plans (Part C) and other Medicare plans

4. Medicare prescription drug coverage (Part D)

5. Programs for people with limited income and resources

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For More Information

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

Medicare & You handbookOther Medicare publicationswww.medicare.govwww.cms.hhs.govYour local SHIP

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