Important Information About Medicare
Original Medicare covers many health care services and supplies, but there are many costs (“gaps”) it doesn’t cover. There are several health care coverage plans that can help you pay for certain services above and beyond Original Medicare. These health care plans work with the benefits you have from Original Medicare. In most of these plans, there are generally extra benefits and lower co-payments than in Original Medicare. However, a person may have to see doctors that belong to the plan or go to certain hospitals to get services. A person can switch plans each year in the fall, if desired.
What you choose will affect how much you pay, what benefits you have, which doctors you can see, and other things that may be important to you.
Your main options for getting extra coverage beyond Original Medicare are:
– Medicare Advantage Plans: Provided by private insurance companies as a replacement of Part A and Part B. Often provide additional benefits above and beyond Original Medicare and Prescription Drug coverage.
– Medicare Supplement Plans (also known as “Med Supp” or “Medigap”): Provided by private insurance companies as an addition to Part A and Part B. Fills the “gaps” in Original Medicare plan coverage. Do not include Prescription Drug Coverage.
– Medicare Prescription Drug Plans (Part D): Insurance that covers both brand-name and generic prescription drugs at participating pharmacies in your area. Provides protection for people who have very high drug costs or from unexpected prescription drug bills in the future.
What to Consider When Choosing or Changing Your Coverage
Coverage: When choosing between Original Medicare and a Medicare health plan, does the plan provide extra coverage you want that Original Medicare doesn’t cover?
Your other coverage: Do you have, or are you eligible for, other types of health or prescription drug coverage? If so, read the materials you get from your insurer or plan, or call them to find out how the coverage works with, or is affected by, Medicare. If you have coverage through a former or current employer or union, talk to your benefits administrator, insurer, or plan before making any changes to your coverage.
Cost: How much are your premiums and deductibles? How much do you pay for services like hospital stays or doctor visits? Your costs vary and may be different if you don’t follow the coverage rules.
Doctor and hospital choice: Do your doctors accept the coverage? Are they accepting new patients? If you are considering a Medicare health plan, do you have to choose your hospital and health care providers from a network? Do you need a referral to see a specialist?
Prescription drugs: What are your drug needs? Do you need to join a Medicare drug plan? What will your prescription drugs cost under each plan? Are your drugs covered under the plan’s formulary (drug list)? Formularies can change.
Quality of care: The quality of care and services given by plans and other health care providers can vary. Medicare has information to help you compare plans and providers.
Convenience: Where are the doctors’ offices? What are their hours? Which pharmacies can you use? Can you get your prescriptions by mail?
Travel: Do you spend part of each year in another state? Will the plan cover you there?
How to Decide Which Plans are Best for You
How do I Enroll in Medicare?
Enrollment in Original Medicare is automatic for a person who is turning 65 and who is already getting Social Security benefits, or who will start getting them at age 65. A Medicare card will be mailed out about three months before the 65th birthday. If a person isn’t getting Social Security benefits when he or she turns age 65, the person will have to sign up for Medicare.
Automatic enrollment includes Part A and Part B. If people don’t want Part B, they should follow the instructions that come with the card, and send the card back. If they keep the card, they keep Part B.
Enrollment is also automatic for a person who has been entitled to Social Security disability benefits for at least 24 months. A Medicare card is mailed out about 3 months before the 25th month of disability benefits.
A person with amyotrophic lateral sclerosis (also known as Lou Gehrig’s disease) will get a Medicare card about 4 weeks after qualifying for Medicare. A person with end-stage renal disease, or ESRD, does not need to be receiving Social Security disability benefits to qualify for Medicare, and may still be working.
The Centers for Medicare and Medicaid Services (CMS) administers Medicare, but the Social Security Administration (SSA) is responsible for enrolling most people in Medicare. The Railroad Retirement board is responsible for enrolling railroad retirees. For questions about Medicare enrollment, or to apply for Medicare benefits, call SSA at 1-800-772-1213, or go to http://www.ssa.gov to find out more.
The Medicare card looks like the red, white, and blue card shown here. Your Medicare card is your proof that you have Medicare insurance.
When to Enroll in Medicare:
When should I apply?
If you are already getting Social Security retirement or disability benefits or railroad retirement checks, you will be contacted a few months before you become eligible for Medicare and given the information you need. You will be enrolled in Medicare Parts A and B automatically. However, because you must pay a premium for Part B coverage, you have the option of turning it down.
If you are not already getting retirement benefits, you should contact the Centers for Medicare & Medicaid Services (CMS). about three months before your 65th birthday to sign up for Medicare. You can sign up for Medicare even if you do not plan to retire at age 65.
Once you are enrolled in Medicare, you will receive a red, white and blue Medicare card showing whether you have Part A, Part B or both. Keep your card in a safe place so you will have it when you need it. If your card is ever lost or stolen, you can apply for a replacement card or call Social Security’s toll-free number. You will also receive a Medicare & You (Publication No. CMS-10050) handbook that describes your Medicare benefits and Medicare plan choices.
Special enrollment situations
You also should contact Social Security about applying for Medicare if:
– You are a disabled widow or widower between age 50 and age 65, but have not applied for disability benefits because you are already getting another kind of Social Security benefit;
– You are a government employee and became disabled before age 65;
– You, your spouse or your dependent child has permanent kidney failure;
– You had Medicare medical insurance in the past but dropped the coverage; or
– You turned down Medicare medical insurance when you became entitled to hospital insurance (Part A).
Initial enrollment period for Part B
When you first become eligible for hospital insurance (Part A), you have a seven-month period (your initial enrollment period) in which to sign up for medical insurance (Part B). A delay on your part will cause a delay in coverage and result in higher premiums. If you are eligible at age 65, your initial enrollment period begins three months before your 65th birthday, includes the month you turn age 65 and ends three months after that birthday. If you are eligible for Medicare based on disability or permanent kidney failure, your initial enrollment period depends on the date your disability or treatment began.
When does my enrollment in Part B become effective?
If you accept the automatic enrollment in Medicare Part B, or if you enroll in Medicare Part B during the first three months of your initial enrollment period, your medical insurance protection will start with the month you are first eligible. If you enroll during the last four months, your protection will start from one to three months after you enroll.
The following chart shows when your Medicare Part B becomes effective:
General enrollment period for Part B
If you do not enroll in Medicare Part B during your initial enrollment period, you have another chance each year to sign up during a “general enrollment period” from January 1 through March 31. Your coverage begins the following July. However, your monthly premium increases 10 percent for each 12-month period you were eligible for, but did not enroll in, Medicare Part B.
Special enrollment period for people covered under an employer group health plan
If you are 65 or older and are covered under a group health plan, either from your own or your spouse’s current employment, you have a “special enrollment period” in which to sign up for Medicare Part B. This means that you may delay enrolling in Medicare Part B without having to wait for a general enrollment period and paying the 10 percent premium surcharge for late enrollment. The rules allow you to:
– Enroll in Medicare Part B any time while you are covered under the group health plan based on current employment; or
– Enroll in Medicare Part B during the eight-month period that begins with the month your group health coverage ends, or the month employment ends-whichever comes first.
– Special enrollment period rules do not apply if employment or employer-provided group health plan coverage ends during your initial enrollment period.
– If you do not enroll by the end of the eight-month period, you will have to wait until the next general enrollment period, which begins January 1 of the next year. You also may have to pay a higher premium, as described in General enrollment period for Part B.
People who receive Social Security disability benefits and are covered under a group health plan from either their own or a family member’s current employment also have a special enrollment period and premium rights that are similar to those for workers age 65 or older.
Medicare Advantage Plans
You can join, switch, or drop a Medicare Advantage Plan at these times:
– When you first become eligible for Medicare (3 months before you turn age 65 to 3 months after the month you turn age 65).
– If you get Medicare due to a disability, you can join during the 3 months before to 3 months after your 25th month of disability.
– Between November 15-December 31 each year. Your coverage will begin on January 1 of the following year.
– Between January 1-March 31 of each year. However, you can’t join or switch to a plan with prescription drug coverage during this time unless you already have Medicare prescription drug coverage (Part D).
– You also can’t drop a plan with prescription drug coverage or join, switch, or drop a Medicare Medical Savings Account Plan during this period.
In most cases, you must stay enrolled for that calendar year starting the date your coverage begins. However, in certain situations, you may be able to join, switch, or drop a Medicare Advantage Plan at other times. Some of these situations include the following:
– If you move out of your plan’s service area
– If you have both Medicare and Medicaid
– If you qualify for “extra help”
– If you live in an institution
Medicare Prescription Drug Plans
You can join, switch, or drop a Medicare drug plan at these times:
– When you first become eligible for Medicare.
– Between November 15-December 31 each year. Your coverage will begin on January 1 of the following year.
In most cases, you must stay enrolled for that calendar year starting the date your coverage begins. However, in certain situations, you may be able to join, switch, or drop Medicare drug plans during a special enrollment period (like if you move out of the service area, lose other creditable prescription drug coverage, live in an institution, or qualify for “extra help”).
You will be charged a late enrollment penalty (an amount that is added to your Part D premium for as long as you have Medicare drug coverage) if all of the following are true:
– You don’t join a Medicare drug plan when you’re first eligible.
– You don’t have other creditable prescription drug coverage.
– You later decide to join a Medicare drug plan.
Medicare Supplement Plans
The best time to buy a Medicare Supplement policy is during the 6-month period that begins on the first day of the month in which you are both age 65 or older and enrolled in Part B. (Some states have additional open enrollment periods.) After this initial enrollment period, your option to buy a Medicare Supplement policy may be limited.
During the open enrollment period, an insurance company can’t use medical underwriting. This means the insurance company can’t do any of the following:
– Refuse to sell you any Medicare Supplement policy it sells
– Make you wait for coverage to start (except as explained below)
– Charge you more for a Medicare Supplement policy because of your health problems
While the insurance company can’t make you wait for your coverage to start, it may be able to make you wait for coverage of a pre-existing condition. A pre-existing condition is a health problem you have before the date a new insurance policy starts. In some cases, the Medicare Supplement insurance company can refuse to cover your out-of-pocket costs for these pre-existing health problems for up to 6 months. This is called a “pre-existing condition waiting period.” Coverage for a pre-existing condition can only be excluded in a Medicare Supplement policy if the condition was treated or diagnosed within 6 months before the date the coverage starts under the Medicare Supplement policy. (Remember, for Medicare-covered services, Original Medicare will still cover the condition, even if the Medicare Supplement policy won’t cover your out-of-pocket costs.)
Even if you have a pre-existing condition, if you buy a Medicare Supplement policy during your Medicare Supplement open enrollment period and if you recently had certain kinds of health coverage called “creditable coverage,” it is possible to avoid or shorten waiting periods for pre-existing conditions. Prior creditable coverage is generally any other health coverage you recently had before applying for a Medicare Supplement policy. If you have had at least 6 months of prior creditable coverage, the insurance company can’t make you wait before it covers your pre-existing conditions. There are many types of health care coverage that may count as creditable coverage for Medicare Supplement policies, but they will only count if you didn’t have a break in coverage for more than 63 days.
If there was any time that you had no health coverage of any kind and were without coverage for more than 63 days, you can only count creditable coverage you had after that break in coverage. Talk to your Medicare Supplement insurance company. It will be able to tell you if your previous coverage will count as creditable coverage for this purpose. If you buy a Medicare Supplement policy when you have a guaranteed issue right (also called “Medicare Supplement protection”), the insurance company can’t use a pre-existing condition waiting period at all.
Note: You can send in your application for a Medicare Supplement policy before your Medicare Supplement open enrollment period starts. This may be important if you currently have coverage that will end when you turn age 65. This will allow you to have continuous coverage
While we specialize in Medicare Supplements, you can CLICK HERE to explore options for dental coverage options.
Medicare Part A Gaps
Medicare Part A (also known as Hospital Insurance) covers inpatient hospital, inpatient skilled nursing facility, home health, and hospice services. The following is a partial list of gaps in coverage that are not reimbursed by Medicare:
– Hospital deductible per spell of illness ($1156 for 2012);
– Hospital coinsurance payments (Medicare covers the first 60 days in full after the deductible has been met; the daily coinsurance payment for days 61 to 90 is $289 per day in 2012 and for days 91 + over, $578);
– Hospital services beyond 150 days per spell of illness;
– Skilled nursing facility coinsurance payments (Medicare covers the first 20 days in full; the daily coinsurance payment for days 21 to 100 is $144.50 per day in 2012);
– Skilled nursing facility services beyond 100 days per spell of illness;
– Home health aide services that are provided on more than a part-time or intermittent basis;
– Home health nursing and aide services when there is no longer a skilled care component;
Medicare Part B Gaps
Medicare Part B (also known as Supplementary Medicare Insurance) provides coverage for a variety of outpatient and physician services. It also pays for durable medical equipment, prosthetic devices, supplies incident to physician’s services, and ambulance transportation. The following is a list of gaps in coverage that are not reimbursed by Medicare:
– Part B deductible (an annual deductible – $140 in 2012- must be met before Medicare will make payment for covered services);
– Part B 20% coinsurance payment (Medicare pays 80% of the approved charge for all Part B services and items, an amount that varies according to the services and items provided);
– Balance billing above the Medicare-approved charge (many physicians and providers charge more than the amount Medicare approves);
WHO NEEDS MEDICARE SUPPLEMENT INSURANCE
Medicare beneficiaries fill in Medicare’s coverage gaps in a number of different ways, including:
– Government Programs (Medicaid/QMB/SLMB);
– Group Retirement Policies (Non-Standardized);
– Non-Standardized Individual Medigap Policies (Issued Prior to July 31, 1992);
– Standardized Individual Medigap Policies (Issued After July 31, 1992).
You can find information on all Medicare Preventive Services by clicking HERE.
You can find Your Guide to Medicare’s Preventive Services by clicking HERE.
Medicare covers a one-time preventive physical exam within the first 12 months that you have Part B. The exam will include a thorough review of your health, education and counseling about the preventive services you need, like certain screenings and shots, and referrals for other care. The “Welcome to Medicare” physical exam is a great way to get up-to-date on important screenings and shots and to talk with your doctor about your family history and how to stay healthy.
What should I expect during my exam?
During the exam, your doctor will record your medical history and check your blood pressure, vision, and weight and height to measure your body mass index. Body mass index (BMI) is a measure of body fat based on height and weight that applies to both adult men and women. Your doctor will check to make sure that you are up-to-date with preventive screenings and services, such as cancer screening and shots. Depending on your general health and medical history, further tests may be ordered if necessary. For example, a person at risk for an abdominal aortic aneurysm may get a referral for a one-time screening ultrasound at their “Welcome to Medicare” physical exam.
Your doctor will also give you advice to help you prevent disease, improve your health or stay well. You will also get a written plan (such as a checklist) when you leave letting you know which screenings and other preventive services you should get.
Starting in 2009, your doctor will also talk with you about end-of-life planning, including advance directives. Advance directives are legal documents that allow you to put in writing what kind of health care you would want if you were too ill to speak for yourself. Talking to your family, friends, and health care providers about your wishes is important, but these legal documents ensure your wishes are followed.
Remember! Once you enroll in Part B, it’s important to schedule your “Welcome to Medicare” physical exam right away. Medicare will only cover this physical exam if it occurs within the first 12 months that you have Part B. If your doctor thinks this 12-month period has passed, he or she should give you a notice that says Medicare probably won’t pay for this service. If you still want to get the service, you will be asked to sign an agreement that you will pay for the service yourself if Medicare doesn’t pay for it. This is called an Advance Beneficiary Notice.
How much does the exam cost?
You pay 20% of the Medicare-approved amount, and no Part B deductible.
What should I bring with me to the exam?
You should bring the following things with you when you go to your “Welcome to Medicare” physical exam:
– medical records, including immunization records (if you are seeing a new doctor for the first time)
– family health history – try to learn as much as you can about your family’s health history before your appointment. Any information you can give your doctor can help determine if you are at risk for certain diseases.
– a list of prescription drugs that you currently take, how often you take them, and why.
Medicare Part B is fairly comprehensive but far from complete. There are certain items and services which are excluded from coverage. Excluded services include:
1. Services which are not reasonable or necessary;
2. Custodial care;
3. Personal comfort items and services;
4. Care which does not meaningfully contribute to the treatment of illness, injury, or a malformed body member;
5. Prescription drugs which do not require administration by a physician;
6. Routine physical checkups;
7. Eyeglasses or contact lenses in most cases;
8. Eye examinations for the purpose of prescribing, fitting, or changing eyeglasses or contact lenses;
9. Hearing aids and examinations for hearing aids;
10. Immunizations except for influenza, pneumococcal and hepatitis B vaccine;
11. Cosmetic surgery;
12. Most dental services;
13. Routine foot care
Part B of Medicare is intended to fill some of the gaps in medical insurance coverage left under Part A. After the beneficiary meets the annual deductible, Part B will pay 80% of the “reasonable charge” for covered services, the reimbursement rate determined by Medicare; the beneficiary is responsible for the remaining 20% as “co-insurance.” Unfortunately, the “reasonable charge” is often less than the provider’s actual charge. If the provider agrees to “accept assignment,” he agrees to accept Medicare’s “reasonable charge” rate as payment in full and the patient is only responsible for the remaining 20%. If the provider does not accept assignment, the patient will be responsible for paying a portion of the difference between Medicare’s reimbursement rate (the reasonable charge) and the provider’s actual charge.
Since 1972, individuals receiving Social Security retirement benefits, individuals receiving Social Security disability benefits for 24 months, and individuals otherwise entitled to Medicare Part A, are automatically enrolled in Part B unless they decline coverage. Others must enroll in Part B by filing a request at the Social Security office during certain designated periods.
The major benefit under Part B is payment for physicians’ services. In addition, home health care, durable medical equipment, outpatient physical therapy, x-ray and diagnostic tests are also covered. Since January 1, 1998 home care is covered under Part B if the individual does not meet the Part A prior institutional requirements, received coverage under Part A for the maximum annual 100 visits, or only has Part B.
The following is a list of items and services which can be covered under Part B:
1. Physicians’ services;
2. Home Health Care;
3. Services and supplies, including drugs and biologicals which cannot be self-administered, furnished incidental to physicians’ services;
4. Diagnostic x-ray tests, diagnostic laboratory tests, and other diagnostic tests;
5. X-ray therapy, radium therapy and radioactive isotope therapy;
6. Surgical dressings, and splints, casts and other devices used for fractures and dislocations;
7. Durable medical equipment;
8. Prosthetic devices;
9. Braces, trusses, artificial limbs and eyes;
10. Ambulance services;
11. Some outpatient and ambulatory surgical services;
12. Some outpatient hospital services;
13. Some physical therapy services;
14. Some occupational therapy;
15. Some outpatient speech therapy;
16. Comprehensive outpatient rehabilitation facility services;
17. Rural health clinic services;
18. Institutional and home dialysis services, supplies and equipment;
19. Ambulatory surgical center services;
20. Antigens and blood clotting factors;
21. Qualified pyschologist services;
22. Therapeutic shoes for patients with severe diabetic foot disease;
23. Influenza, Pneumococcal, and Hepatitis B vaccine;
24. Some mammography screening;
25. Some pap smear screening, breast exams, and pelvic exams;
26. Some other preventive services including colorectal cancer screening, Diabetes training tests, bone mass measurements, and prostate cancer screening.
Part A Non-Covered Services
Medicare Part A DOES NOT cover the following:
– Private duty nursing
– A television or telephone in your room or personal care items like razors or slipper socks
– A private room unless medically necessary
– Custodial care, assisted living, adult daycare, or reimbursement for family members
– The first three pints of blood unless the blood deductible has been met
The doctor services you get while you are in a hospital may be filed under Part B.
Medicare Part A helps pay for care in the following facilities if they are medically necessary based on Medicare requirements, and your eligibility for Medicare Part A.
Medicare Part A Covered Facilities
– Inpatient care in hospitals (including critical access hospitals)
– Skilled nursing facilities (SNFs)
– Long Term Care Hospital (LTCH)
– Inpatient Rehabilitation Facility (IRF)
– Hospice care
– Home health care
– Beneficiary access to religious nonmedical health care institution (RNHCI) services
– Inpatient Mental health/psychiatric care
– Obesity Bariatric Surgery
Medicare Part A helps pay for the following services if they are medically necessary based on Medicare requirements. You must be eligible for Medicare Part A in order to get the following services.
Medicare Part A Covered Services
– Room and Board
– All meals and special diets
– General nursing
– Medical social services
– Physical, occupational, and speech-language therapy
– Drugs with the exception of some self-administered drugs
– Blood transfusions
– Other diagnostic and therapeutic items and services
– Medical supplies and use of equipment
– Respite care in hospice
– Transportation services
– Inpatient alcohol or substance abuse treatment
– Part A blood (see the restrictions under noncovered services)
– Clinical Trials (Inpatient)
– Kidney Dialysis (Inpatient)
The almost unprecedented economic upheaval we are experiencing has shaken confidence in the strength and stability of our financial system. There’s no doubt that the world is much more financially complex than it used to be. Now, more than ever, people need more information about the companies they do business with. How strong are they? Will those companies be there when it comes time to pay the promised benefits? Even during this time of great financial stress, our carriers are strong, stable and secure. We want to address your questions about a companies financial condition in a straightforward, objective and understandable way. With company options that have over 100 years in business, we represent organizations that you can count on for the strength, stability and security and that’s even more important in these uncertain times. We look forward to working with you for years to come.
For a half a century, Nevin and Witt been there to keep our promises to our customers. That will not change. During these uncertain economic times, our companies are strong, stable, secure and ready to meet your insurance and financial needs.
Our companies are often one of the first Medigap offerings Medicare recipients turn to when searching for a Medicare supplement. We represent some of the top 3 providers of Medicare supplements. Often times Medicare recipients have enough faith in them to just buy our recommended companies Medicare supplement’s without shopping the entire Medicare supplement market. Most of our companies provide several options for Medicare supplements in multiple states.
Congressional discussions about health care reform legislation are entering their final stages. The Affordable Health Care for America Act, H.R. 3962, was introduced in the House of Representatives on Thursday, October 30, 2009, and is expected to be voted upon in November. The Senate is in the process of merging bills that were passed by the Senate Finance Committee and the Senate Health Education Labor and Pensions (HELP) Committee.
Medicare plays an important role in these discussions. Congress hopes to use Medicare to develop innovative delivery system reforms that will improve quality of care and slow the growth of health care costs. Congress also would like to address issues pertaining to the solvency of the Medicare Part A trust fund as part of reform efforts.
This Alert focuses on those Medicare provisions in the legislation that are of greatest interest to beneficiaries and their advocates, as well as on some related Medicaid provisions. It also briefly discusses provisions of the House legislation that would be effective immediately, before the 2013 effective date of the basic coverage expansions for the uninsured that are the primary focus of the legislation.
Ensuring Access to Doctors
Opponents of health care reform have threatened Medicare beneficiaries that they would not be able to see their doctors if health care reform legislation is enacted. The opposite is true. Reforms are needed to ensure that physicians will continue to be reimbursed adequately enough to accept Medicare beneficiaries as patients. Under current rules, physicians are scheduled for a 21% reduction in their Medicare reimbursement starting in January 2010.
Unfortunately, for political reasons, a “Doc Fix” designed to reform the physician payment system is not included in H.R. 3962 or its Senate counterpart. A separate bill to redesign doctor payment, H.R. 3961, was introduced in the House of Representatives on the same day as HR 3962; the Senate is considering a modification that is more short-termed. H.R. 3962 does, however, include other payment reforms that create incentives for primary care physicians and other practitioners to serve Medicare beneficiaries.
Reducing Overpayments to Medicare Advantage Plans
Both the House and the Senate address the 14% overpayment to Medicare Advantage (MA) plans. The House bill would adopt the Medicare Payment Advisory Commission (MedPAC) recommendation to create a “level playing field” with traditional Medicare. It also eliminates the fund set-aside for regional MA plans, and extends permanently the authority of the Secretary to adjust payments when MA plans claim their beneficiaries have higher health care needs than claims data establish.
The Senate bill would create a competitive bidding process for MA plans that would not achieve as much in savings, and that would still result in MA plans in some areas being paid more than traditional Medicare. Both bills include bonus payments for quality. The Senate bill may include a provision to “grandfather” in extra benefits for plans in areas, such as Miami, that would otherwise see the most dramatic change in their compensation.
Closing the Part D Donut Hole and Other Reductions in Drug Costs
Under H.R. 3962, the phase-out of the Donut Hole would begin in 2010. The bill would increase the initial coverage limit, the point at which people enter the Part D coverage gap, by $500 for next year. The phase-out of the donut hole would be completed by 2019. Meanwhile beneficiaries would be charged only 50% of the cost of certain drugs in the coverage gap. Additionally, drug manufacturers must agree to Medicaid drug rebates for dual eligibles in order for their drugs to be covered by Part D beginning in 2010. The House also provides for negotiation of drug prices by the Secretary of Health and Human Services, with Part D plan sponsors still having the opportunity to try to negotiate greater drug price savings for their plans.
The bill that passed the Senate Finance Committee only included a provision to reduce the cost of brand name drugs in the coverage gap. It did not close the Donut Hole, require pricing rebates, or provide for negotiation of drug prices by the Secretary. The final bill introduced in the Senate may do more to close the Donut Hole.
Much of the focus on health care reform is on prevention of health conditions. The House bill eliminates co-payments and deductibles for preventive services that are covered by Medicare. It is expected that the Senate bill will do the same. The House bill also provides that all Medicare-covered vaccines will be covered under Medicare Part B. This ensures access to vaccines for all beneficiaries and should make them available without any cost-sharing.
Provisions to Assist Beneficiaries with Limited Incomes and Resources
Neither the House bill nor the bill passed by the Senate Committees include all of the improvements that beneficiary advocates would have liked to see included in health care reform legislation. The Senate bill so far includes only minor adjustments.
H.R. 3962 increases the resource limit for the Part D Low Income Subsidy (LIS) and for Medicare Savings Programs to $17,000/ individual, $34,000/couple and provides for self-verification of income and resources. It establishes a process for reimbursement to beneficiaries who are found retroactively eligible for the Part D Low Income Subsidy. It eliminates Part D cost-sharing for dual eligible individuals who are in a Medicaid waiver program and who require nursing facility or intermediate care facility for the mentally retarded level of care. It provides for a different methodology for calculating the Part D plan benchmark for the Low Income Subsidy which will result in far fewer low income individuals having to be reassigned to new Benchmark plans each year. It gives the Secretary authority to assign low income beneficiaries to plans that meet their individual needs. It also extends the Qualified Individual (QI) program, which helps pay for Part B premiums, for two years.
The House bill provides authority for the Internal Revenue Service to share data with the Social Security Administration that would allow the latter to better target its outreach efforts. It also includes a technical correction to last year’s Medicare legislation, the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), concerning data transmission from the Social Security Administration to the states.
Coordination of Care
H.R. 3962 provides for a variety of demonstrations and pilot projects to move Medicare toward reimbursement for coordination of care for beneficiaries with chronic conditions. These programs include:
– Transitional care services: Follow-up services designed to prevent avoidable hospital re-admissions, including pre-and post-discharge planning services, care coordination, medication orders, and translator/interpreter services;
– Accountable care organizations (ACOs): An ACO is a group of physicians and other providers who use patient-centered processes and other best practices to coordinate care and avoid duplication of services. Payment incentives are based on improved quality and reduced expenditures. ACOs must agree not to deny, limit, condition coverage or the provision of care based on the health status of an eligible beneficiary.
– Medical home: A medical home directs or provides access to primary care and all health care needs, taking responsibility for arranging for care and ensuring access.
– Independence at home: Home-based primary care teams provide coordinated care to high need populations at home to reduce hospital admissions and re-admissions, to reduce duplicative testing, and to improve outcomes.
The House, the Senate, and President Obama all expressed interest in having some independent entity review Medicare payment mechanisms. H.R. 3962 authorizes two studies by the Institute of Medicine (IOM). One looks at geographic adjustment factors under Medicare, including issues concerning workforce recruitment and retention. The other looks at geographic variation in health care spending and promoting high value health care, including variations in prices, health status, practice patterns, access and supply, and socio-economic factors.
The Senate Finance bill included a provision to establish a Medicare Commission with authority to review Medicare payment structures and make recommendations to effectuate cost-savings. The recommendations would become effective if Congress did not act within specified, and very fast, time periods. The provision also included targeted caps on Medicare spending. Although the provision said that the Commission could not make recommendations about beneficiary premiums and cost-sharing, a last-minute amendment would allow the Commission to make recommendations concerning Part D premiums.
Other Beneficiary Provisions
H.R. 3962 incorporates some additional consumer protections. The Senate bill is also likely to include provisions designed to provide additional protection to beneficiaries. The following are examples of some of these protections:
– Change the time frame for enrollment in Medicare Advantage and Part D plans;
– Limit cost-sharing in Medicare Advantage plans;
– Require MA plans to make available to beneficiaries information on their administrative costs (Medical Loss Ration);
– Allow payments by ADAP and Indian Health Service programs to count toward the Part D out-of-pocket limit;
– Calculate the Part D benchmark premium amount before application of MA plan subsidies;
– Extend the exception process for the Part B therapy caps;
-Create a demonstration project for reimbursement for culturally and linguistically appropriate services.
Medicaid Provisions Relevant to Medicare Beneficiaries
The House bill expands Medicaid coverage to non-disabled, childless adults under age 65 who are not eligible for Medicare and whose incomes are at or below 150% of the federal poverty level (FPL). It also extends coverage to certain “traditional” Medicaid populations – children, parents and people under 65 with disabilities – with incomes at or below 150% FPL. The latter expansion does not exclude people under 65 with Medicare, but none of the expansions includes people 65 and older. There is no asset test for individuals covered by these expansions. The Senate bill will likely expand Medicaid, as well, but less generously.
Medicare cost-sharing protections are added for people under 65 who, but for their income, meet the definition of a Qualified Medicare Beneficiary and whose incomes are less than 150% FPL.
Medicaid payments for primary care are increased over several years, with increases linked to Medicare payments.
Temporary increases in the federal matching payment to states that were made in the American Recovery and Reinvestment Act of 2009 are extended through June 2011.
The House bill requires the Secretary of Health and Human Services to establish an office or program within the Centers for Medicare & Medicaid Services to improve coordination between Medicare and Medicaid and protection for dual eligibles. The Senate bill is likely to have a similar provision, though the functions and duties of such an office or program are described somewhat differently.
Provisions of the House Bill Effective Immediately or Shortly After Passage
Various private insurance market reforms are effective in 2010. These include provisions establishing a temporary insurance program for those who have been uninsured for several months; requiring that insurers use 85% of premiums for benefits; prohibiting the rescission of policies except for instances of fraud; requiring annual review of premium increases by the Secretary of Health and Human Services; requiring insurers to allow for the continuation of coverage of children through age 26; shortening the time allowed for exclusion of coverage for pre-existing conditions; and prohibiting acts of domestic violence from being treated as pre-existing conditions.
Additional provisions effective in 2010 require insurers to pay for reconstructive surgery for children with deformities; eliminate lifetime aggregate limits on benefits; prohibit discriminatory reductions in retiree health coverage compared with coverage for active employees; establish a temporary reinsurance program to reduce retiree (age 55-64) out-of-pocket costs for those in employment based plans; establish a grant program for small employers to create non-discriminatory wellness programs; extend COBRA eligibility until the Health Insurance Exchange established by the bill is up and running; expand existing grant programs to states to promote coverage for the uninsured prior to 2013 when the Exchange begins, and require the Secretary of HHS to adopt standards for transactions between providers and insurers.
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While we specialize in Medicare Supplements, you can CLICK HERE to learn more more and even apply online for the Humana Part D Plan.
The following is a listing of the Medicare premium, deductible, and coinsurance rates that will be in effect in 2014:
Medicare Premiums for 2014
Part A: (Hospital Insurance) Premium
– Most people do not pay a monthly Part A premium because they or a spouse has 40 or more quarters of Medicare-covered employment.
– The Part A premium is $234 per month for people having 30-39 quarters of Medicare-covered employment.
– The Part A premium is $426 per month for people who are not otherwise eligible for premium-free hospital insurance and have less than 30 quarters of Medicare-covered employment.
Part B: (Medical Insurance) Premium
Most beneficiaries will pay the $104.90 premium amount in 2014. This is no change from 2013. Beneficiaries who make more than $85,000 per year ($170,000 for couples) will pay a higher premium.
Yes! Because of our relationship with some insurance companies, we are one of a handful of agencies that can actually provide you with a true online application process for your Medicare Supplement Coverage. Other Internet sites tell you that they can do your application online, but once you enter your information – you find that it was not true. NOT WITH US! You can submit or application online in real time or we can help you also. Just call us at 1-800-247-9889. You can submit your application to us by clicking on “Apply Online Now” (on the right side of your screen). If the company you are applying for requests a “wet signature”, we will send, email or fax it to you to complete.
What are the gaps in Medicare coverage for which I would need “Medigap,” Medicare supplemental coverage?
How do I know if I need benefits in Medigap insurance?
What changes to Medigap occurred as a result of the Medicare Act of 2003?
What are the standard benefits in Medigap insurance?
For other information, follow one of the links below or scroll down the page.
Gaps in coverage
Who Needs Medicare Supplement Insurance
The Standard Medicare Supplement Policies
Consumer Protections under Federal Law
Additional Consumer Protections for CT Policies
Changes to Medigap Insurance
What to consider when purchasing Medigap
Chart of Standard Medigap Plans
Deductible for high option policy
GAPS IN COVERAGE
Medicare Part A Gaps
Medicare Part A (also known as Hospital Insurance) covers inpatient hospital, inpatient skilled nursing facility, home health, and hospice services. The following is a partial list of gaps in coverage that are not reimbursed by Medicare;
– Hospital deductible per incident of illness ($1216 for 2014)
– Hospital coinsurance payments (Medicare covers the first 60 days in full after the deductible has been met; the daily coinsurance payment for days 61 to 90 is $304 per day in 2014, and for days 91 + over is $608 per day)
– Hospital services beyond 150 days per spell of illness
– Skilled nursing facility coinsurance payments (Medicare covers the first 20 days in full; the daily coinsurance payment for days 21 to 100 is $152 per day in 2014)
– Skilled nursing facility services beyond 100 days per spell of illness
– Home health aide services that are provided on more than a part-time or intermittent basis
– Home health nursing and aide services when there is no longer a skilled care component
Medicare Part B Gaps
Medicare Part B (also known as Medical Insurance) provides coverage for a variety of outpatient and physician services. It also pays for durable medical equipment, prosthetic devices, supplies incident to physician’s services, and ambulance transportation. The following is a list of gaps in coverage that are not reimbursed by Medicare:
Part B deductible (an annual deductible – $147 in 2014- must be met before Medicare will make payment for covered services)
Part B 20% coinsurance payment (Medicare pays 80% of the approved charge for all Part B services and items, an amount that varies according to the services and items provided)
Balance billing above the Medicare-approved charge (many physicians and providers charge more than the amount Medicare approves)
WHO NEEDS MEDICARE SUPPLEMENT INSURANCE
Medicare beneficiaries fill in Medicare’s coverage gaps in a number of different ways, including:
Government Programs (Medicaid/QMB/SLMB);
Group Retirement Policies (Non-Standardized);
Non-Standardized Individual Medigap Policies (Issued Prior to July 31, 1992);
Standardized Individual Medigap Policies (Issued After July 31, 1992).
Medicare beneficiaries who are also eligible for Medicaid (Title 19) do not need Medigap insurance since Medicaid will cover the cost of their health care expenses. People who do not qualify for Medicaid but are within 100% of the federal poverty level are eligible for coverage under a program known as the Qualified Medicare Beneficiary Program (QMB). QMB program benefits include:
– Payment of Medicare premiums.
– Payment of Medicare annual deductibles.
– Payment of Medicare coinsurance amounts.
Thus individuals who qualify for the QMB program generally also do not need, and should not pay for, Medicare Supplement Insurance. The qualifying income figures change in April each year. Contact the Department of Social Services office in your area to find out more about Title 19 and QMB eligibility and enrollment.
Individuals who do not qualify for QMB because of excess income may qualify for the Specified Low-Income Medicare Beneficiary Program (SLMB) or Qualified Individual Program (QI). People who have incomes within 120% – 135% of the federal poverty level are eligible for SLMB or QI coverage. However, SLMB and QI only pay for the Medicare Part B monthly premium. Therefore, SLMB and QI individuals may still want to purchase Medigap insurance if they can afford to do so. Like QMB, the qualifying income figures change in April each year and the programs are administered by the Department of Social Services.
Some employers offer health insurance coverage to their retirees. Retirees who are covered by such group plans may not need to purchase an individual policy. While a retiree may choose to switch to an individual plan, this may not be a good choice because group retiree plans usually do not cost anything to the individual and the group coverage is often as good or better than most individual Medigap policies. Thus the individual should compare his company’s policy costs and coverage with the ten Medigap policies. The retiree should also consider the stability of his company. If it is conceivable that the company will falter, that his costs will rise, or that coverage will diminish, the individual may wish to purchase an independent policy. Remember, however, that if a new policy is purchased the old policy must be dropped.
Most Medicare beneficiaries are not eligible for Medicaid or QMB, however, and may want to obtain Medigap insurance. Approximately two-thirds purchase Medigap policies. As of July 31, 1992, Medigap policies were standardized throughout the United States. This mandatory standardization was a result of legislation passed by Congress through the Omnibus Budget Reconciliation Act of 1990. There are ten specific benefit plans which federal law permits to be sold as Medigap policies. Two new plans were added in 2006. States may allow all or some of these plans to be marketed. Insurance companies may sell all or some of the plans which the individual state allows them to market. However, there is a basic benefit package, known as the “core benefit” plan, which must be allowed in all states and which must be offered by any company which sells Medigap insurance.
Although individual Medigap policies have been standardized since 1992, some seniors are still covered by previously issued non-standardized plans. These policies are no longer available for purchase. However, individuals may continue to keep their old policies and many people have chosen to do so. Individuals covered by an old policy should consider changing to a new “standardized” plan, and should compare the benefits and costs of each of the policies. Then an informed decision can be made. An individual who purchases a new standardized policy can only have one Medigap policy and must therefore drop the old, non-standardized plan. This protects people from the unnecessary costs of duplicate coverage.
THE STANDARD MEDICARE SUPPLEMENT POLICIES
The ten modernized benefit policies are labeled A through N. Policy A contains the basic or “core” benefits. The other eleven policies contain the core benefits plus one or more additional benefits. The following is a list of the benefits that are contained in the core policy and that must be contained in all new Medigap policies sold beginning July 31, 1992:
– Part A Hospital Coinsurance for Days 61-90;
– Part A Hospital Lifetime Reserve Coinsurance for Days 91-150;
– 365 Lifetime Hospital Days Beyond Medicare Coverage;
– Parts A and B Three Pint Blood Deductible;
– Part B 20% Coinsurance.
Additional benefits are offered in policies B through L. Each plan offers a different combination of these benefits in addition to the core benefits. Additional benefits are:
– Part A Skilled Nursing Facility Coinsurance for Days 21-100;
– Part A Hospital Deductible;
– Part B Deductible;
– Part B Charges above the Medicare Approved Amount (if provider does not accept assignment);
– Foreign Travel Emergency Coverage;
– At-Home Recovery (Home Health Aid Services);
– Preventive Medical Care
Policies B through N vary considerably. Beneficiaries should review the policy packages carefully and decide which coverages are appropriate for them. The chart at the end of these materials illustrates the various coverages for Medigap policies A through N.
There are many issues which must be considered before purchasing Medigap insurance. For example, what specific benefits does the individual require? How much will the premiums cost?
Are the benefits worth the cost? Will the individual be able to afford the premiums in the future? What if he/she decides to switch to a Medicare Advantage plan and then wants to, or has to, switch back?
Certain consumer protections are provided pursuant to federal law and protect Medicare beneficiaries across the country. Connecticut provides additional protections. Some of those protections are described below.
CONSUMER PROTECTIONS UNDER FEDERAL LAW
Guaranteed issue means that an insurance company is required to sell a policy and may not force an individual to prove “insurability” by making the person pass an insurance physical examination.
All newly entitled Medicare beneficiaries have a right to guaranteed issue of any Medigap policy which is offered for sale for the first six months after their Medicare entitlement begins. This right only applies to Medicare beneficiaries who are 65 years of age or older. Insurance companies are not required by federal law to offer the same range of Medigap policies to Medicare beneficiaries with disabilities that they offer for sale to Medicare beneficiaries over age 65. Some states require insurance companies to sell designated Medigap policies to Medicare beneficiaries with disabilities. Connecticut requires insurance companies to offer Plans A, B and C to Medicare beneficiaries with disabilities, if they offer these policies for sale to older Medicare beneficiaries. Connecticut also requires that insurance companies which offer plans A-N sell these plans at all times to Medicare beneficiaries who are over age 65.
Since 1997, pursuant to the Balanced Budget Act of 1997, Medicare beneficiaries who are at least 65 years old are also guaranteed issuance of certain Medigap policies if they apply within 63 days after disenrollment from a Medicare managed care plan. The circumstances under which these rights exist are as follows:
– A Medicare beneficiary who enrolled in a Medicare managed care plan upon first becoming eligible for Medicare who subsequently disenrolled within 12 months is guaranteed issue of any Medigap policy offered for sale in her state.
– If such a beneficiary enrolled in a Medicare managed care plan which withdrew from the geographic area within the first 12 months of the individual’s enrollment and the individual enrolled in another Medicare managed care plan, the time in which the beneficiary may disenroll and purchase any Medigap plan is extended for a second 12 month period, for a total of 24 months.
– A Medicare beneficiary who dropped a Medigap policy upon enrolling for the first time in a Medicare managed care plan but who subsequently disenrolled from the managed care plan within 12 months is guaranteed issuance of the same Medigap policy from the same insurance company if that policy is still being offered for sale. Otherwise, such an individual is entitled to guaranteed issuance of Medigap Plans A, B, C or F.
– If such an individual enrolled for the first time in a Medicare managed care plan which withdrew from the geographic area within the first 12 months of the individual’s enrollment, the time in which these special Medigap rights apply is extended for a second 12 month period, for a total of 24 months.
– A Medicare beneficiary who moved out of the area or whose Medicare managed care plan terminated service to her area, became bankrupt or violated or misrepresented a provision of the plan is guaranteed issuance of Medigap Plans A, B, C or F. These same rights apply to Medicare beneficiaries whose employer stops providing retiree health insurance coverage.
– NOTE: Connecticut beneficiaries over age 65 have the right to purchase Policies A – N from any company selling those policies in Connecticut.
IMPORTANT NOTE: The Centers for Medicare and Medicaid Services (CMS) has stated that the above Balanced Budget Act provisions do NOT apply to Medicare beneficiaries whose Medicare entitlement is based on their disability or upon End Stage Renal Disease. According to CMS, these provisions apply only to Medicare beneficiaries who are at least 65 years old. Upon purchasing a Medigap policy, a Medicare beneficiary has 30 days in which to change her mind, cancel the policy and receive a refund of the previously paid premium.
A pre-existing condition exclusion means that health insurance may not cover the costs incurred as a result of a medical condition a person had prior to obtaining the health insurance coverage. The ability of insurance companies to impose pre-existing condition exclusions has been severely constricted since the enactment of a federal law called “HIPAA.” Under HIPAA, if an individual had health insurance coverage for a period of at least 6 months prior to their initial open enrollment period for Medicare, no pre-existing condition exclusion may be imposed. Most types of health coverage offer this “creditable coverage,” including employee or union group health insurance, retiree health insurance, Medicare Parts A and B and Medicaid (Title 19).
For Medigap purposes, creditable coverage is conferred for the number of months an individual was covered by another Medigap policy or was enrolled in a Medicare HMO. Thus, if an individual was previously in another Medigap plan or Medicare managed care plan for at least six months, no pre-existing condition limit can be imposed by a new Medigap plan.
Prohibition on Duplicate Policies
Another important provision of the law is that insurance companies and agents are prohibited from selling a beneficiary a second Medigap policy. An insurance agent is required to disclose this provision to Medicare beneficiaries and must obtain a written acknowledgment. A new policy may be sold to replace an existing policy, but this fact must also be acknowledged in writing. However, an individual may keep or purchase another medical insurance policy which is not a Medigap policy. Such policies include hospital indemnification coverage which only provide benefits for hospitalization and nothing else. When an insurance company or independent insurance agency sells such a policy, they must disclose to the purchaser the specific coverage and certify that the policy is not a Medigap policy.
Agents must also ask if the beneficiary is eligible for Medicaid coverage. A policy holder who becomes eligible for Medicaid may have premiums suspended for up to two years. If Medicaid eligibility is terminated during this period, the individual will be able to return to his prior Medigap policy.
RECENT CHANGES TO MEDIGAP INSURANCE
The Medicare Prescription Drug, Modernization and Improvement Act (MMA) contains provisions which affected Medigap insurance. This new law, which went into effect on January 1, 2006, changed coverage under Medigap plans H, I, and J and created two additional Medigap plans, designated K and L.
A beneficiary who delays enrollment in a Part D plan in favor of keeping a Medigap plan which covers prescription drugs faces late enrollment penalties for Part D if that Medigap plan is not considered to be as good as Part D’s standard benefit (creditable coverage). Medigap insurance issuers were required to send notice to their enrollees between September 15, 2005 and November 15, 2005 advising them if the Medigap insurance they have is creditable. Most Medigap plans will not be considered creditable coverage because their coverage is not as good as the standard Part D benefit.
Medigap Plans K & L
Beginning January 1, 2006, two new Medigap plans were offered. Plan K will fully covers the cost sharing for Part B preventive services, the Part A hospital co-insurance and an additional 365 days of hospital coverage. It also covers 50% of the Part A and Part B blood deductibles, the Part B co-insurance, the skilled nursing facility co-insurance, the cost sharing associated with the hospice benefit, and the Part A hospital deductible. Plan K covers 100% of all cost sharing under Medicare Parts A and B for the rest of the calendar year once a beneficiary reaches an out-of-pocket limit of $4000 in 2006.
Plan L fully covers the cost sharing for Part B preventive services, the Part A hospital co-insurance and an additional 365 days of hospital coverage. It will also cover 75% of the Part A and Part B blood deductibles, the Part B co-insurance, the skilled nursing facility co-insurance, the cost sharing associated with the hospice benefit, and the Part A hospital deductible. Plan L covers 100% of all cost sharing under Medicare Parts A and B for the rest of the calendar year once a beneficiary reaches an out-of-pocket limit of $2000 in 2006.
WHAT TO CONSIDER WHEN PURCHASING MEDIGAP INSURANCE
There are many considerations when purchasing Medigap insurance. The most important considerations are the person’s medical needs and financial abilities. The individual should look at his or her current needs and abilities and also try to anticipate future concerns.
Obtaining Coverage and Switching Policies
Remember that under federal law an individual age 65 or older may enroll in any of the twelve policies during the six-month period after first being covered by Part B. Connecticut beneficiaries over age 65 are guaranteed the ability to purchase Medigap plans A-N beyond this six-month period.
Remember that prior coverage under another Medigap policy or Medicare Managed care plan counts toward the six-month waiting period for coverage of pre-existing conditions. Finally, some companies have liberal rules about letting a person switch from one policy to another policy offered by that company.
The next major consideration in selecting a Medigap policy is cost. A person must be able to afford the particular policy he or she desires. There is a great deal of price difference from policy to policy.
There is also a big difference in price from company to company for the same policy. Thus, before purchasing one of the higher priced policies, the buyer should be certain that he desires something else about the company besides the policy’s benefits (for example, a reputation for timely claims processing).
MEDIGAP MODERNIZED MEDICARE SUPPLEMENT PLANS
See plans for your State by clicking here to Download the PDf
MEDIGAP DEDUCTIBLE AMOUNT FOR HIGH DEDUCTIBLE POLICY OPTIONS
CMS released the 2008 deductible amount for Medigap high deductible plans F & J; effective January 1, 2008, the annual deductible amount for those two plans is $2,000. The high deductible amount for Medigap plans F and J is updated each year and is based on the August CPI-U figures released by the Bureau of Labor Statistics. The full text of the announcement is available on the CMS website at: http://www.cms.hhs.gov/Medigap/. This figure represents the out-of-pocket expense, excluding premiums, that a beneficiary must incur before the policy begins paying any benefits. Under the high deductible option, policies pay 100% of covered out-of-pocket expenses once the deductible has been satisfied in a year. Note, the high deductible option for benefit packages F or J was added by Section 4032 of the Balanced Budget Act of 1997, Sec. 1882(p) of the Social Security Act, 42 U.S.C. 1395ss(p).
A Medigap policy is health insurance sold by private insurance companies to fill the “gaps” in Original Medicare Plan coverage. Medigap policies help pay some of the health care costs that the Original Medicare Plan doesn’t cover. If you are in the Original Medicare Plan and have a Medigap policy, then Medicare and your Medigap policy will pay both their shares of covered health care costs.
Insurance companies can only sell you a “Modernized” Medigap policy (as of June 1, 2010). These Medigap policies must all have specific benefits so you can compare them easily.
You may be able to choose up to 10 different Modernized Medigap policies (Medigap Plans A through N). Medigap policies must follow Federal and State laws. These laws protect you. A Medigap policy must be clearly identified on the cover as “Medicare Supplement Insurance.” Each plan, A through N, has a different set of basic and extra benefits.
It’s important to compare Medigap policies because costs can vary. The benefits in any Medigap Plan A through N are the same for any insurance company. Each insurance company decides which Medigap policies it wants to sell.
Generally, when you buy a Medigap policy you must have Medicare Part A and Part B. You will have to pay the monthly Medicare Part B premium. In addition, you will have to pay a premium to the Medigap insurance company.
You and your spouse must each buy separate Medigap policies. Your Medigap policy won’t cover any health care costs for your spouse.
For additional information on Medigap policies, including why you would want to buy a Medigap policy and information about what Medigap policies cover, please read this publication, Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.
Medicare Supplement Open Enrollment Period
The best time to purchase a Medicare Supplement insurance policy (also called a Medigap policy) is during your Medigap open enrollment period. This 6 month period begins on the first day of the month in which you are both age 65 or older and enrolled in Medicare Part B. Once you enroll in Part B, your Medicare Supplement open enrollment period begins and cannot be changed. During this period, an insurance company cannot use medical underwriting. This means they can’t refuse to sell you any Medigap policy that they offer, make you wait for coverage to start, or charge you more for a Medigap policy because of past or present health problems.
Please note that you are allowed to apply early, before your Medicare Supplement open enrollment period starts. You should not wait until your health coverage has almost ended. This will allow you to have continuous coverage.
Medigap Guaranteed Issue Rights
Even if you are no longer in your Medigap or Medicare Supplement open enrollment period, there are situations in which you still have a guaranteed right to buy Medicare Supplement insurance. In these situations, an insurance company must sell you a Medigap policy (plan choices may be limited), must cover all of your pre-existing conditions, and can not charge you more for your policy because of health problems.
When Are Guaranteed Issue Rights Granted?
In most situations, you have guaranteed issue rights if you have other health care coverage that is changing in some way, or you are losing this coverage. Here is a summary of these situations:
#1: You are enrolled in a Medicare Advantage Plan, and this plan is leaving the Medicare Program or stops servicing your area, or you are moving out of your plan’s service area.
#2: You have employer health coverage or union coverage that pays after Medicare pays, and that coverage is ending.
#3: You have a Medicare SELECT policy, and you are moving out of the plan’s service area. You can keep your Medigap policy or switch to another Medigap policy.
#4: (Trial Right) You enrolled in a Medicare Advantage Plan or PACE when you were first eligible, and within your first year of joining, you wish to switch to the Original Medicare Plan.
#5: (Trial Right) You dropped a Medicare Supplement policy (Medigap policy) to join a Medicare Advantage Plan (or to switch to a Medicare SELECT policy) for the first time; you have been in the plan for less than a year and you want to switch back.
#6: Your Medicare Supplement insurance (Medigap) company goes bankrupt causing you to lose coverage, or your Medigap policy coverage ends through no fault of your own.
#7: You decide to drop a Medigap policy or leave a Medicare Advantage Plan because the company hasn’t followed the rules or misled you.
Additional Medigap Protection
The guaranteed issue rights listed on this page are from from Federal law. Many states include additional Medigap rights. Also, it is possible that more than one of these situations applies to you. If so, choose the guaranteed issue right that gives you the best choices of available plans for your situation. For more information on qualifying, call your State Health Insurance Assistance Program.
Most of our companies have NO Preexisting waiting periods on any health conditions you may have when you join the plan.
Beneficiary – General term used for one who receives a benefit. Used on this site to describe those people receiving Medicare benefits, or Medicare and Medicaid benefits when preceded by “Dual Eligible”.
CMS – Abbreviation for the Centers for Medicare & Medicaid Services, the federal agency that administers the Medicare program and works in partnership with the states to administer Medicaid, the State Children’s Health Insurance Program (SCHIP), and health insurance portability standards.
Creditable Coverage – Any health insurance coverage you had within 63 days of securing a new insurance policy that can be used to shorten the waiting period for pre-existing conditions.
Disenrollment – Leaving a health plan like an HMO.
Dual Eligible – A person who has both Medicare and Medicaid.
Doughnut Hole – deliberately designed gap in coverage in Medicare Part D; essentially a second huge deductible.
Election Periods – The times when a Medicare-eligible person can choose to join or leave Original Medicare or a Medicare Advantage plan. There are four types of election periods: the annual election period, the initial election period, the special election period, and the open enrollment period.
Enrollment – Joining Original Medicare or becoming a member of a private health plan, like a Medicare HMO.
FAQs – Frequently Asked Questions
Formulary – List of covered drugs
Lock-in – Inability to change Medicare plans for a certain amount of time
LIS – Low Income Subsidy, also called “Extra Help” that offers reduced cost-sharing to eligible beneficiaries.
Medicare Advantage – Formerly “Medicare+Choice”, or “Medicare Part C”; Medicare managed care/non-traditional Medicare plans; Medicare plans offered by Private companies, rather than through the traditional Medicare program
MA-PD – Medicare Advantage Plan with Prescription Drug Coverage
Medicare Part B – Medicare coverage for physicians’ services, some outpatient services & therapy, durable medical equipment, prosthetic devices, ambulance services, home health services not covered under Part A, some pap smear and mammography screens, flu shots, and some therapeutic shoes.
Medicare Part C – See Medicare Advantage
Medicare Part D – The Medicare prescription drug program
Medicare Portability – The ability – currently nonexistent – of a Medicare Eligible person to receive services from a Medicare approved provider outside the United States. Portability may also be an issue between states or service areas of Medicare Advantage plans, which are not always accepted nationwide, as traditional Medicare is.
Medicare Savings Programs (MSP) – Also known as Medicare Buy-In programs, they help pay your Medicare premiums and sometimes also coinsurance and deductibles. There are three Medicare Savings Programs, with different eligibility limits: QMB, SLMB, and QI-1.
Part D – Shorthand for Medicare Part D, the Medicare prescription drug program.
Plan – A program or policy stipulating services or benefits. In relation to Medicare, “plan” may be used in reference to Medigap, managed care, or prescription drug services.
Preferred Drug List – A drug list (formulary) includes selected brand name drugs that are considered preferred because of their overall ability to meet patient needs at a reasonable cost. If a brand-name drug is necessary, those classified as preferred may result in lower cost-sharing than non-preferred brand-name drugs.
Prescription Drug Plan – (PDP) Stand-alone drug plans under Part D. These plans offer drug Coverage only, allowing the beneficiary to remain in the traditional Medicare program for their other needs.
Re-importation – Purchasing prescription drugs from foreign countries
Rx – Prescription Drug
SPAP – State Pharmaceutical Assistance Plans
Special Needs Plan – MA plans in that they are intended to enroll, exclusively or disproportionately, only specific high-needs subpopulations of the Medicare population (dually eligibles, institutionalized beneficiaries, or beneficiaries with chronic conditions or disabilities). A SNP must be a “coordinated care” plan, either a Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO) and must provide coverage for Part D, as well as for Parts A and B.
Spend-down – Process by which individuals who would be eligible for Medicaid except for their monthly income subtract their medical costs from their income to get it down to or below the limits for Medicaid.
True Out-of-Pocket Costs – (TrOOP) Prescription drug expenses paid by beneficiary, charity or SPAP.
Wrap around – Supplemental coverage offered in some states to fill in the gaps left by the Part D program.
Generally, Medicare is available for people age 65 or older, some younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or transplant).
If you already get benefits from the Social Security Administration or the Railroad Retirement Board, you are automatically entitled to Medicare Part A (Hospital Insurance) and Part B (Medical Insurance) starting the first day of the month that you turn 65. You do not need to do anything to enroll. Your Medicare card will be mailed to you about 3 months before your 65th birthday. If you wait until you are 65, or sign up during the last three months of your initial enrollment period, your Medicare Part B start date will be delayed.
**EXAMPLE: If your 65th birthday is August 20, your Medicare effective date would be August 1. If your birthday is on the 1st day of any month, Medicare Part A and Part B will be effective the 1st day of the prior month. For example, if your 65th birthday is August 1, your Medicare effective date would be July 1.**
If you are not receiving Social Security, Railroad or disability benefits, you can enroll in Medicare and a Medicare drug plan up to 3 months before your 65th birthday and no later than 3 months after the month of your birthday. This is called the initial enrollment period. You will need to submit an application to the Social Security Administration. You can also sign up for Part B at your local Social Security office. They will determine if you are eligible, and then send you a Medicare card. Some government employees who have not paid into Social Security may also have to file an application. Social Security can answer any questions about your application.
If you want both Medicare Part A and Medicare Part B, you should sign your Medicare card and keep it in your wallet. If you don’t want Part B coverage, you must put an “X” in the refusal box on the back of the Medicare card form. You should then sign the form and return it in the enclosed envelope to the address shown (below where you sign the Medicare card). In about 4 weeks, you will receive a new card showing you only have Medicare Part A coverage.
Please be aware that if you decide to pick up Part B coverage at a later date, the cost of Part B may go up 10% for each 12-month period that you could have had Part B but did not sign up for it. Also, if you decline or cancel your Part B coverage, you will not be eligible to receive Medicare covered preventive services.
If you live in Puerto Rico and are receiving Social Security or Railroad Retirement benefits, you will be automatically enrolled in Medicare Part A only. If you would like to enroll in Medicare Part B, you’ll need to contact the Social Security Administration to fill out an application. If you do not enroll in Medicare Part B, you will be sent a Medicare card showing Part A only.
Note: A Special Enrollment Period is available if you waited to enroll in Medicare Part B because you or your spouse was working AND had group health coverage through a current employer or union. If this applies, you can sign up for Medicare Part B:
– While you are still covered by an employer or union group health plan, through your or your spouse’s employment, or
– During the 8 months following the month when the employer or union group health plan coverage ends or when the employment ends (whichever comes first).