What you don’t know about Medicare may cost you more than money

Submitted by Joy Smith

It’s that time of year again, the time when the TV airwaves are filled with ads for all manner of Medicare supplements and alternative plans.  For those folks under the age of 65, you may just be annoyed at the overwhelming number of the ads, similar to the influx of political ads during the run-up to each election.  For those 65 and over, it’s often very difficult to sift through all of the information and claims to determine what might be the best possible choice for ongoing healthcare, particularly in light of last year’s healthcare reforms.

For the “under-age” folks, what’s going on is that there is an annual open enrollment period for Medicare Advantage programs and Part D prescription drug plans.  If “seniors” (those eligible for enrollment in Medicare) do not choose to enroll in either of these two programs during this period…this year, October 15 through December 7….they lose their opportunity to do so until the open enrollment period next year, except for very specific situations. Medicare supplement plans are not impacted by these dates (you can sign up for or switch supplement plans anytime.)

Failure to enroll in a Part D drug plan when first eligible to do so and not having “creditable coverage” for longer than 63 days may result in increased premiums through a “late enrollment penalty”  which will be applied for the rest of the time the senior is enrolled in any Part D plan. Many Medicare Advantage plans include prescription drug coverage making it unnecessary to enroll separately. If a senior leaves an Advantage plan, it will generally be necessary to enroll in a separate Part D plan.

From the annual Medicare and You 2012:  Medicare Advantage Plans, sometimes called “Part C” or “MA Plans,” are offered by private companies approved by Medicare. If a senior joins a Medicare Advantage Plan, they still have Medicare. They will get their Part A (Hospital Insurance) and Part B (Medical Insurance) coverage from the Medicare Advantage Plan and not Original Medicare. In all types of Medicare Advantage Plans, they’re always covered for emergency and urgent care. Medicare Advantage Plans must cover all of the services that Original Medicare covers except hospice care. Original Medicare covers hospice care even if they’re in a Medicare Advantage Plan. Medicare Advantage Plans aren’t supplemental coverage.

Medicare pays a fixed amount for their care every month to the companies offering Medicare Advantage Plans. These companies must follow rules set by Medicare. However, each Medicare Advantage Plan can charge different out-of-pocket costs and have different rules for how they get services (like whether they need a referral to see a specialist or if they have to go to only doctors, facilities, or suppliers that belong to the plan for non-emergency or non-urgent care). These rules can change each year.  There is a website: www.medicarenewswatch.com that will allow seniors to compare yearly out-of-pocket costs of each of the available Advantage plans by area of the state sorted by good health, fair health and poor health.

For seniors who want to keep more control over their own health care choices, there are also multiple Medicare supplement plans known as Medigap policies. The government specifies what each plan covers (Plans A through N) so seniors’ choices boil down to what company offers which plans, how well they pay their bills, and what they charge for each plan.  Seniors can research all companies offering plans in Texas by going to the Texas Department of Insurance website www.tdi.texas.gov/ and looking on the right side of the screen where there is a “hot spot” to click “I want to check companies”. For more information on Medigap policies and the laws governing them, download the brochure “Choosing a Medigap Policy: A Guide to Health Insurance for People” with Medicare” from www.medicare.gov/ under the Publications spot.

As of June 1, 2010, some plans (E, H, I and J) are no longer available anywhere in the US.  Anyone currently covered by one of those plans may keep it, but it is important to realize that not only are there holes in what is covered, but all plans prior to that date are in “closed” blocks.  No new folks can be added which will result in higher and higher premiums as those who keep those plans age and make more claims.  The “holes” in coverage may result in folks getting bills where once everything was paid.

Special times for folks just turning 65 and/or those who have received a notice that their plan is being discontinued (Advantage plans are only required to stay active on a yearly basis): Open enrollment is a 6-month period starting on the senior’s 65th birthday, and enrollment in Medicare Part B.  Open enrollment means that the senior may sign up for any supplement plan based solely on age and address.  No health questions may be asked.  This is particularly important for anyone who has health issues that might keep them from qualifying for coverage (or qualifying for coverage, but having to pay hefty premiums.)  Everyone only gets one open enrollment period.  For those who have had coverage discontinued as well as several other special circumstances, there is a time called guaranteed issue.  When a senior has a guaranteed issue right, he/she cannot be turned down for a Medicare supplement plan….just as in open enrollment, no health questions can be asked. Seniors may have multiple guaranteed issue rights times throughout their tenure with Medicare, but everyone only has one open enrollment period (not to be confused with the open enrollment period for Medicare Advantage programs and Part D plans when seniors must either enroll or drop their enrollment in those plans.)

What to do?  Everyone enrolled in Medicare should already have received his/her Medicare and You 2012 book.  This year, instead of adding it to the pile in the corner, pick it up and read at least the What’s New section and any other parts that might or might not pertain to your situation.  Check out the websites cited in this article.  If you’re not yet 65, but want to start preparing, go to www.medicare.gov/ and download any of the publications that interest you.  Get with your insurance agent, and/or feel free to call me at 512-517-1552.  I am licensed and trained as a senior healthcare specialist.  Happy health!  Joy

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