Understanding Medicare Basics with edits by Illinois SHIP
Module 1B
November 16, 2010 2
What is Medicare?
A health insurance for people– 65 and older– Under 65 with certain disabilities– Any age with End-Stage Renal Disease (ESRD)
Administration– Centers for Medicare & Medicaid Services
Enrollment – Social Security Administration for most– Railroad Retirement Board (RRB)
Understanding Medicare
Different Parts of Medicare
Medicare Has four Parts– Part A: Hospital Insurance
– Part B: Medical Insurance
– Part C: Medicare Advantage• HMO, PPO, Private-Fee-For-Service, Special Needs Plan
o Also referred to has Medicare Health Plans
– Part D: Prescription Drug Coverage
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“Original Medicare”
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Part A & B
Some will include Part D
Part – B
Part – A
Part – D or Secondary
MedSup
or
Secondary
Ways to receive Medicare
Original MedicareMedicare Advantage
(HMO, PPO, etc)
Social Security Administration Responsible for eligibility and enrollment
– People aged 65yrs or older• Contributed into FICA 40 quarters (10yrs)• Married and receiving benefits under a spouse’s work record• Must have been married a minimum of 10yrs to receive
benefits under a former spouse
– Under age 65yrs• Receiving disability benefits under SSA or Railroad
retirement systems for 24 months
– Any Age• Receiving regular dialysis• Amyotrophic Lateral Sclerosis (ALS)
o a.k.a Lou Gehrig’s Disease
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Medicare for Disabled Individuals
Disability Defined:– Inability to work– Expected to last for 1 year or result in death
• Can be the result of blindnesso Visual acuity 20/200 or less with correcting lens in better eye
ORo Visual field of 20 degrees or less
Note: SSA is responsible for disability determination
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Qualifying for Disability Benefits
Meet requirements– Definition of disability– Work credits
• Or relationship to someone with work credits
5-month waiting period– Exceptions
• People eligible for childhood disability benefits• Some people previously entitled to disability benefits
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Applying for Disability Benefits
Call SSA at 800-772-1213 Necessary documentation needed
– Social security number– Proof of age– Health-care provider information– Medical records– Work history
• Including W-2 for the past two years
Don’t wait to apply
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Qualifying for Medicare due to Disability
24-month waiting period– Exceptions for people with ALS
• No additional waiting period• Medicare starts with first month of benefits
Medicare usually begins 30th month after disability begano 5 months + 24 months = 29 month wait
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ESRD Disability For Medicare
Coverage begins:– Fourth month of dialysis
• First month if certain conditions are met
– Month you receive kidney transplant– Month you are admitted to approved hospital
• For transplant of procedures preliminary to transplant
– 2 months before month of transplant• If transplant is delayed more than 2 months
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Enrollment Periods Initial Enrollment Period (IEP)
– 3month before, month of, 3months after• Person’s 65th birthday• 30th month for Medicare due to disability
General Enrollment Period (GEP)– January 1st through March 31st of each year– Medicare coverage begins July 1st of same year
• Penalties will usually apply
Special Enrollment Period (SEP)– Working or covered by a working spouse
• Medicare Part B – 8 months from when retirement begins• Medicare Part D – 63days from when retirement begins
o Only if already enrolled into Medicare Part A
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Original Medicare Go to any provider that accepts Medicare Enrolled into Medicare Part A
– Premium free for most people• Paid 40 quarters (10yrs) into FICA
– Others may be able to purchase• If a U.S. citizen; or
• Legal U.S. resident of 5 continuous years or more
Enroll into Medicare Part B– Pay monthly premium
• Starting in 2007 some individuals have their premiums based on their taxable income
Pay Part A and Part B– Deductible– Coinsurance or co-payment
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Medicare Card (front)
Jane DoeUnderstanding Medicare
Medicare Part A - Covered Services
Inpatient Hospital CareSemi-private room and board, general nursing, meals, and the other hospital services and supplies
Skilled Nursing Facility CareFull-time inpatient nursing and rehabilitative services (Custodial Care not covered)
Home Health Care
Part-time skilled nursing care, home health aids, physical and occupational therapy, speech and language pathology
Hospice CareSupport services from a Medicare-approved hospice, includes drugs for system control and pain relief
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Benefit Period Part A (Hospital Insurance) charges are based on
“benefit period”– Inpatient hospital care and skilled nursing facility (SNF)
services– Begins first day of inpatient hospital care– Ends when you have been out of a hospital or SNF for
60 days in a row – Benefit period is not based on a calendar year– You pay deductible for each benefit period– No limit to number of benefit periods
Understanding Medicare
Medicare Part B - Covered Services
Medical Expenses
Physician services, some diagnostic test, physical and speech therapy, ambulance, observation stay in the hospital…etc.
Home Health Care
Part-time skilled nursing care, home health aids, physical and occupational therapy, speech and language pathology
Outpatient Hospital ServicesOutpatient surgery, diagnostic procedures, emergency room, partial hospitalization…etc.
Durable Medical Equipment (DME)
Walkers, wheelchairs, hospital beds, insulin pump, some medication associated with a DME…etc.
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Medicare Part B – Preventive Services
“Welcome to Medicare” Physical Exam – Available only to new Part B beneficiaries
Annual “Wellness Exam” – Available to everyone on Medicare beginning Jan. 1, 2011
Bone Mass Measurements Cardiovascular Screening
Colorectal Cancer Screening Diabetes Screening
Hepatitis B Shots Glaucoma Screening
Pneumococcal Shot Pap Test and Pelvic Exam
Screening Mammograms Prostate Cancer Screening
Smoking Cessation Counseling Flu Shot
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Paying the Part B Premium
Taken out of one of the following monthly payments:– Social Security
– Railroad Retirement
– Federal Government Retirement
For information about premiums– Call SSA or RRB
• Office of Personnel Management if a retired Federal employee
Will be billed every 3 months– If not receiving SSA or RRB benefits
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Medicare Penalties Part A
– Penalty will only apply if a beneficiary has to purchase Medicare Part A
• 10% a year for twice the number of years
Example: Mrs. Robinson has delayed enrollment into Part A for 2 years, her penalty will be 10% a year for 4 years.
Part B– If a person delayed enrollment into Part B, their
penalty will be 10% for each year and will remain with them for as long as they are on Medicare
Example: Ms. Debbie has delayed enrollment into Part B for 3 years, she will have to pay a 30% penalty including her monthly premium for as long as she is on Medicare.
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Medicare Supplement Insurance
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2010’s MedSup Policy – Core Benefit
Core Benefits for Plans A, B, C, D, F, G, M, N include: All Part A coinsurance expenses for : $283 per day for 61st through 90th day; $566 per day for 91st through 150th day; Part A Hospice coinsurance Upon exhaustion of Part A hospitalization benefits, full coverage of an
additional 365 days per lifetime; Part B coinsurance or copayment; including Part B Preventive Services First three pints of blood each calendar year
*Core benefits for Plan K and L are the same as listed above with the exception of 50% (Plan K) and 75% (Plan L) payment for the Part A deductible, Part B coinsurance, the blood deductible, hospice care coinsurance and Skilled Nursing Facility coinsurance.
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2010’s Medicare Supplement Policieseffective June 1, 2010 and currently available
Benefits IncludedPlan
APlan
BPlan
CPlan
DPlan
FPlan
GPlan
KPlan
LPlan
MPlan
N
Core Benefits √ √ √ √ √ √ √* √* √ √*
Skilled Nursing Facility √ √ √ √ √*
(50%)
√*(75%)
√ √
Part A Deductible √ √ √ √ √ √*(50%)
√*(75%)
√*(50%)
√
Part B Deductible √ √
Part B Excess (100%) √ √
Foreign Travel √ √ √ √ √ √
Out-of Pocket Maximum
$4620 $2310 22November 16, 2010 Understanding Medicare
What is a MedSup Policy? Health insurance policy
– Provided by private insurance companies
Used with “Original Medicare” only– Must have both Medicare Part A and Part B– Covers the major gaps in Medicare
• Medicare-approved charges
All policies are standardized– Each policy will be identical from company to company
• Except in Massachusetts, Minnesota, and Wisconsin
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2010’s Medicare Supplement Policieseffective June 1, 2010 and currently available
Benefits IncludedPlan
APlan
BPlan
CPlan
DPlan
FPlan
GPlan
KPlan
LPlan
MPlan
N
Core Benefits √ √ √ √ √ √ √* √* √ √*
Skilled Nursing Facility √ √ √ √ √*
(50%)
√*(75%)
√ √
Part A Deductible √ √ √ √ √*(50%)
√*(75%)
√*(50%)
√
Part B Deductible √ √
Part B Excess (100%) √ √
Foreign Travel √ √ √ √ √ √
Out-of Pocket Maximum
$4620 $2310 24November 16, 2010 Understanding Medicare
High Deductible Option
Another variation of a Medicare Supplement Policy offered is a “high-deductible option”
Offered only with a standardize Plan F Plan will not pay it’s portion of benefits until
deductible has been met– $2,000 in 2011
Deductible is adjusted each year
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What is a MedSelect Policy? Health Insurance Policy
– Provided by private insurance companies
Used with “Original Medicare” only– Must have both Medicare Part A and Part B
– Covers the major gaps in Medicare• Medicare-approved charges
Conforms to the Standardize plans– Each policy will be identical from company to company
• Except in Massachusetts, Minnesota, and Wisconsin
Must use specific hospital contract with MedSelect plan– For inpatient hospital services
– May have to use specific physicians
Must live within 30 miles of a contracted hospital
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Medicare Supplement Open Enrollment
One-time 6-month window– Have or enrolling into Part A– Enrolling into Part B for first time
• Including those enrolling due to disability
Cannot be denied a policy– Join any plan from any company
May require a pre-existing condition waiting period
– No more than 6 months
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Medicare Disabled Beneficiary Illinois Public Act 95-0436
– Began June 1, 2008– Provided same open enrollment rights for Medicare Supplement
Insurance• 6 months Open Enrollment Period (OEP) upon entitlement to
Medicare Part B
• To purchase any policy from almost any company, regardless of health history
– Company cannot charge a rate higher then their highest rate• Registered with the Illinois Department of Insurance
– Once a beneficiary turns 65 yrs-old, they will be entitled to a new 6 months OEP
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Medicare Disabled Beneficiary2011 Guarantee Enrollment Period
Guaranteed enrollment for disabled Medicare beneficiaries - November 15 through December 31
Guaranteed issue of a Medigap with 3 companies
AARP/ United Healthcare, Blue Cross Blue Shield, and Health Alliance.
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Rights and Guarantees Loss of Medicare Supplement
– Company pulls out of the market• Must be provided with another policy
Loss of other coverage– Employer group health plan
• 63-day Guaranteed Issue• May purchase Plan A, B, C, F, K or L
Medicare Advantage (MA)– Leave MA plan with first 12 months of first enrollment– Plan is pulled from the market
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1990’s Medicare Supplement PoliciesPolicies sold prior to June 1, 2010
Benefits Included
PlanA
PlanB
Plan
CPlan
DPlan
EPlan
FPlan
GPlan
HPlan
IPlan
JPlan
KPlan
L
CoreBenefits
√ √ √ √ √ √ √ √ √ √ √* √*
Skilled NursingCoinsurance
√ √ √ √ √ √ √ √√
(50%
√(75%)
Part ADeductible
√ √ √ √ √ √ √ √ √
√(50%) √
(75%)
Part BDeductible
√ √ √
Part BExcess (100%)
√ √ √
Part BExcess (80%)
√
Foreign Travel Emergency
√ √ √ √ √ √ √ √
At HomeRecovery
√ √ √ √
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What is Secondary Insurance? Secondary insurance is other insurance that is provided by
– Employment sponsored health and/or drug coverage– Retirement health and/or drug coverage– Union sponsored health and/or drug coverage
Not offered by or contracted with Medicare Company may choose;
– Who they will cover– How and what coverage will be offered– if it will provide any additional coverage for Medicare beneficiaries
Note: Medicare beneficiaries should contact their benefits office to see how it will work with Medicare.
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