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The NSPA Blog

Medicare – The Basics

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Posted on July 30th, 2019 by Bettina Carlson, under Insurance & Billing, Medical Planning, Medicare, Patient Advocacy, Patient Tools, Take Charge, Tips & Resources

It’s almost this time of year again, enrollment in health care. One of the options you may have may be Medicare. Whether you will be a first time enrollee, or whether you already are enrolled with Medicare, over the next few weeks, we will provide you with a series of Medicare related topics to empower you with a basic understanding of Medicare, the new changes for 2020, and the options you have. Depending on your particular circumstances, your situation might be more complex than we describe in here. While we can’t delve into all the complexities and particularities in our blogs, you don’t need to worry, there are resources that you can access that will support you in navigating your particular needs. And we will share some of those with you. 

Today we begin with an overview of the basics of Medicare. Instead of “reinventing the wheel”, I have sourced the information below primarily from the following outlets:

Hello Medicare, https://hellomedicare.com/medicare-101/; Medicare, https://www.medicare.gov/pubs/pdf/10050-medicare-and-you.pdf; MedicareAdvantage, https://www.medicareadvantage.com/medicare-enrollment#how-to-apply .

What is Medicare

Medicare is a federal program that offers health insurance to American citizens and other eligible individuals, it helps with the cost of health care, but it does not cover all medical expenses or the cost of most long-term care.

The program is often called Original Medicare. It has two parts—Part A and Part B.

Eligibility 

  • You must be a citizen or legal resident
  • Age 65 or older
  • Younger than 65 with a qualifying disability
  • Any age with a diagnosis of end-stage renal disease (ESRD) or amyotrophic lateral sclerosis (ALS)

Benefits 

Original Medicare 

  • Part A covers inpatient hospital and skilled nursing care
  • Part B covers doctor visits and outpatient care

Private Medicare plans

  • In addition you can sign up with private plans. Most such plans are health maintenance organizations (HMOs) or preferred provider organizations (PPOs). These plans are optional and provide more coverage, such as such as vision, hearing, dental, and/or health and wellness programs
  • Medicare Advantage plans (Part C) combine Part A and Part B coverage. They often include drug coverage and other benefits you don’t get with Original Medicare  
  • Medicare prescription drug plans (Part D) help pay for medications. You can get a stand-alone Part D plan or get a Medicare Advantage plan that includes drug coverage  
  • Medicare supplement insurance (Medigap) helps pay some or all costs not paid by Original Medicare (deductibles, copays and coinsurance)
  • In most cases, you are not eligible to join a Medicare Advantage Plan if you have End‐Stage Renal Disease (ESRD)

Costs

Like other Health Insurance plans, Medicare and many Medicare plans charge monthly premiums; they vary depending on the type of plan and the state you live in. Monthly premiums range from $0 to the high $300s. But overall, average Medicare Advantage Plans’ monthly premiums are usually lower than what you would pay for Medicare Part B. The final numbers are expected to be published in the fall. 

You also pay a share of the cost for health care services you receive. There are three types of payments you may have, just like in traditional health insurance:

  • Deductible: The out of pocket amount the policy holder has to pay before Medicare will pay any expenses
  • Copay: A fixed amount for a covered service a patient has to pay to the provider of service before receiving a covered service. For example, you may pay $20 for a doctor’s visit
  • Coinsurance: A percentage of the cost for a covered service that you pay when you receive it. For example, Medicare might pay 80% of the covered service and the remaining 20% would be paid by you

Enrollment

There are different types of Enrollment periods. I found detailed and easy to understand explanations of those in the following sources: https://www.medicareadvantage.com; an article by Patricia Barry in an AARP bulletin, https://www.aarp.org/health/medicare-insurance/info-12-2010/ask_ms_medicare_question_91.html. Please read these sources for more detailed and specific information.

Initial Enrollment Period (IEP) 

  • This is the time frame for most people to initially sign up for Medicare
  • It runs 7 months, starting three months before the months in which you turn 65, and ending three months after that month. For example, if your birthday is in May, you IEP begins February 1 and ends August 31
  • Use the IEP to enroll in Part A (hospital insurance) even if you do not intend to enroll in Part B 
  • Use the IEP to enroll in Part B (covers doctors’ services, outpatient care and medical equipment) if:
  • You have no other health insurance
  • You still have health benefits from a former employer but you have retired or stopped working or plan to stop shortly
  • You still have health benefits form the former employer of your spouse who has retired or stopped working or plans to do so shortly
  • You have individual health insurance you have purchased yourself
  • You do not qualify for Part A and have no other health insurance
  • You have a qualifying disability, even if you are younger than 65

Annual Open Enrollment Period (AEP)

While you don’t need to sign up for Medicare each year, Annual Open Enrollment gives you the opportunity to sign up for a plan, review your existing Medicare coverage and, if you want to, change to a different plan for the following year.

  • For 2020 coverage, the Annual Open Enrollment begins on October 15 and continues until December 7
  • Switch from one “stand-alone” Part D prescription drug plan to another
  • Switch from one Medicare Advantage plan to another
  • Enroll in a stand-alone Part D prescription drug plan for the first time if you voluntarily opted out of the other drug coverage, such as coverage provided by a current or former employer
  • Enroll in a stand-alone Part D prescription drug plan if you change from a Medicare Advantage Plan to traditional Medicare
  • Change from traditional Medicare to a Medicare Advantage plan
  • Change from a Medicare Advantage plan to traditional Medicare

Medicare Advantage Open Enrollment Period

During Medicare Advantage Open Enrollment Period, you have yet another option to switch or to leave a Medicare Advantage plan. 

Be aware that if you want to enroll in a Medicare Advantage plan, you must meet some basic criteria:

  • It starts January 1 and ends March 31
  • You must live in the plan’s service area
  • You cannot have End-Stage Renal Disease (some exceptions apply; ESRD patients will be able to enroll in Medicare Advantage plans as of 2021, under the terms of the 21st Century Cures Act)
  • If you didn’t sign up for Medicare A and B when you were first eligible, you have a chance to do so now with coverage effective July 1. You may be subject to a late enrollment penalty, however. For Medicare Part B, the penalty is an additional 10 percent of the premium for each 12 month period that you were eligible but not enrolled. There’s a late enrollment penalty for Medicare Part A as well, but it only applies to people who have to pay premiums for Part A. Most people get Part A for free, based on their work history (or a spouse’s work history). (Source: https://www.medicareresources.org/faqs/when-is-the-next-medicare-open-enrollment-period/#2018

Special Enrollment Periods (SEPs)

During Special Enrollment Periods (SEPs) you can make changes to your Medicare health and Medicare prescription drug coverage when certain events happen in your life, like if you move or you lose other insurance coverage.  These SEPs are in addition to the regular enrollment periods that happen each year. Rules about when you can make changes and the type of changes you can make are different for each SEP. For a list of qualifying changes go to https://www.medicare.gov/Pubs/pdf/11219-Understanding-Medicare-Part-C-D.pdf.

How do I choose my coverage

In order to find the right plan for you, consider your medical needs when looking at the different coverage options, and discover which one meets your requirements best.

Your health

  • How often do you go to the doctor?
  • What health problems do you have?
  • What medications do you take regularly?

Your budget

  • What are you able to pay each month in premiums?
  • How comfortable are you covering copays or coinsurance for services?
  • How willing are you to accept the risk of high out-of-pocket costs?

Your preferences

  • Which doctors, hospitals and pharmacies do you like to go to?
  • How important is it for you to have access to health care while traveling?
  • What other coverage do you have, such as an employer or retiree plan? 

Signing up for Original Medicare

You can sign up for Medicare one of four ways:

• Apply online on the Social Security website

• Visit your local Social Security office

• Call Social Security at 1-800-772-1213 (TTY: 1-800-325-0778)

• If you worked for a railroad, call the Railroad Retirement Board at 1-877-772-5772

Final Words

The world of Medicare is a complex and ever-changing world. It can be challenging and intimidating to navigate. But you don’t have to navigate it alone. You may have a trusted friend or family member, who may already have experience with the world of Medicare. Or, if there is something you don’t understand or you are unsure how the rules would affect you,  you could speak with an insurance broker experienced with Medicare. Or you call or visit Social Security and ask your specific questions. Also, familiarize yourself with the different Medicare plans and the terminology used to more effectively ask questions and to better understand what is being explained to you. And start this process early to  give yourself ample time. 

Sources 

Hello Medicare, https://hellomedicare.com/medicare-101/ 

Medicare, https://www.medicare.gov/pubs/pdf/10050-medicare-and-you.pdf 

MedicareAdvantage, https://www.medicareadvantage.com/original-medicare/eligibility-enrollment

Medicare Resources, https://www.medicareresources.org/faqs/when-is-the-next-medicare-open-enrollment-period/#2018 

AARP, https://www.aarp.org/health/medicare-insurance/info-12-2010/ask_ms_medicare_question_91.html

ICOPA CONFERENCE 2019

On another note we at NShore Patient Advocates would like to share some of our latest news with you… The Patient Advocacy Symposium is back, but bigger, better, and brighter than ever before! It has evolved into the International Conference on Patient Advocacy (ICOPA), and will be held right here in Northfield, IL on October 3rd-5th, 2019! We hope you will join us! Please see below for a link with more information:

Home ICOPA 2019

For a no-cost 30 minute initial consultation, please call 847-612-6684 or click here to fill out our online callback request form.