Medicare is a healthcare system available to seniors over the age of 65, and persons under age 65 who qualify on the basis of a disability or other special situation. Beneficiaries of original Medicare (Parts A and B) must be U.S. citizens or a legal resident who has lived in the U.S. for at least 5 consecutive years.
There are currently four parts to Medicare – Part A, Part B, Part C and Part D.
Part A – Covers hospitalization
Part B – Covers doctor and outpatient care, lab test, diagnostics, screenings and shots, and some medications.
Part C – is the Medicare Advantage Plan
Part D – is the Prescription Drug Plan.
Additional services and programs not covered under Medicare include Dental, Vision Services, Podiatry Services, Hearing Services, Hearing Aids, Transportation, Exercise Programs e.g. Silver Sneakers, and programs which enable beneficiaries to transfer health benefits to geographical areas while on vacation or extended stay. These additional benefits vary amongst carriers.
Beneficiaries have three options. In order to access these options, beneficiaries must be enrolled in Part A and eligible for Part B. All beneficiaries must continue to pay their part B premium in order to qualify for Medicare Advantage or Supplement Plans.
The Center for Medicare and Medicaid commonly referred to as “CMS” has contracted Medicare Advantage Plans (Part C) to Private Insurance Companies. These insurers use a network of providers to cover the same services available in Original Medicare (Part A and B) and often prescription drug coverage (Part D) – all in a single plan.
Medicare Advantage Plans offer additional benefits beyond doctor and hospital visits. To qualify for a Medicare Advantage Plan, you must reside in the service area of the plan, be enrolled in Original Medicare Parts A and B, and not have end-stage renal disease (ESRD). Medicare Advantage is not a Medicare Supplement.
Premiums and plan options vary. Monthly premium prices range from zero to over $200. Each plan must offer an annual out of pocket maximum. After the annual maximum is reached, beneficiaries are covered 100% by the plan without additional co-pays, coinsurance, and or deductibles.
Medicare Advantage Plans are renewed annually, which means that benefits and cost are subject to change annually. Once enrolled, the Plan pays for covered services, not Medicare. Beneficiaries remain enrolled in original Medicare. With the exception of end-stage renal disease, No medical underwriting or pre-existing medical conditions will dis-qualify you to sign up for an Advantage Plan.
A Medicare Supplement Plan is an insurance policy that insures your original Medicare. Medicare Part A and B require beneficiaries to pay deductibles, co-insurance and co-pays. The Supplement Plan commonly referred to as a “Medi-gap” Plan will cover co-insurance, co-pays, and deductibles that Medicare does not cover depending on the plan selected.
A Supplement Plan will not insure services unavailable in original Medicare Parts A and B. A supplement Plan also will not cover Part D. You will need to purchase a Part D Plan if you choose this option.
The last option that some beneficiaries choose is to remain enrolled in Original Medicare A and B. These beneficiaries can purchase a Prescription Drug Plan (Plan D).
Beneficiaries who fail to enroll, will be assessed a Late Enrollment Penalty (LEP). This amount will be added to your Part D premium if you go longer than 63 days in a row, after your Initial Enrollment Period (IEP), without Part D or other credible Part D coverage. Think of the penalty as a payment that will come out of your social security check each month. For more information about the Late Enrollment penalty, visit www.medicare.gov or call 1-800-MEDICARE. Hearing impaired users should call 1-877-486-2048.
There are three Enrollment Periods: The Initial Enrollment Period (IEP) is a seventh month period where you can enroll after you become eligible. The period consists of your birthday month, three months prior and three months after. Some individuals qualify for a Special Enrollment Period (SEP). If you move outside of the service area, receive assistance from the state, have been diagnosed with a qualifying chronic health condition, retire, or enter a nursing home you qualify for a SEP. These are just some SEP's. Each year from October 15 to December 7, there is an Annual Enrolment Period (AEP) where you can add, switch, or drop your Medicare plan coverage.
Considerations when enrolling in any plan is the Cost, provider network, and drug formulary. If the plan does not cover your doctors and or medications that you need, it may not work for you. Medicare Advantage enrollment may impact other existing coverage that you have such as employer coverage. It is a good idea to consult with your employer prior to making a change.
You may also qualify for the Low Income Subsidy (LIS) or Extra Help program depending on your income. Please contact the Social Security Administration at www.ssa.gov or call 1-800-772-1213, TTY 1-800-325-0778. Check with your area hospital to see if they offer Charity Care. Charity Care will cover co-pays for individuals who qualify.
Resources such as www.medicare.gov will assist you with comparing plans in your service area. This site will help you view up to three plans side by side.
Please note: Medicare is a separate program from Affordable Care Act (ACA). They are two distinct government health insurance programs. Medicare beneficiaries are not subject to ACA rules and regulations.
Carmen Coleman is a licensed insurance agent and insurance consultant. Offering individual and small group session for Medicare beneficiaries, care providers, and anyone wishing to learn more about medicare. Carmen Coleman is not connected with the Federal Medicare Program.
© Carmen Coleman, President and CEO
Lifetime Financial Group, LLC
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