Posts Tagged ‘Medicare’

Coastal Senior is a monthly periodical published in Savannah, Georgia and circulated throughout the Georgia and South Carolina low country. Bob Mason is its legal columnist.

In case you missed my last column, I am not a fan of Medicare Advantage Plans. Proponents of the plans will tell you they offer “more options” to seniors. In my experience “more options” often is code for “more complex”.

Advantage Plans also cost the taxpayers more. The government pays about 20% more to insurance companies for each Medicare beneficiary than it pays directly to doctors and hospitals on behalf of Medicare beneficiaries under traditional Medicare.

I came down particularly hard on Medicare Advantage “Private Fee for Service Plans” – a type of plan that promises much, often comes up short, and has been accused by the government of using overly aggressive (not to mention illegal) sales techniques (like forgery).

All of this is my opinion. I imagine there could be reasonable people who would disagree – and there actually may be some happy Medicare Advantage enrollees who have experienced some – umm – advantages to Medicare Advantage.

Some Important Considerations

In case you really want to take a look at a Medicare Advantage Plan, consider the following:

• Are your favorite doctors and hospitals covered by the plan? Do they accept the plan’s terms and conditions?

• Do you need a referral to see a specialist?

• Can you get care outside the plan’s service area or network? How?

• What costs are involved in the plan (premiums, deductibles, copayments)?

• Are there copayment requirements for lab tests, diagnostic tests, x-rays, MRI scans, or CT scans?

In case you want that “nice young man” from the insurance company to come by, consider:

• It’s OK to have someone with you when you discuss a Medicare Advantage Plan or any insurance product with an agent. If an insurance agent comes to your home uninvited, make an appointment to meet the agent at a time and place that is convenient to you. Do not invite strangers into your home.

• Obtain the agent’s business card so you can contact him or her later.

• If you are satisfied with your current coverage, you do not need to change.

Bailing Out

Speaking of changing, you need to get a handle on how (and how often) you can change from one type of plan to another – say from traditional Medicare to an Advantage Plan and back. Oh, alas! More complexity.

If you enroll directly in an Advantage plan for the first time upon becoming Medicare eligible or you have dropped a Medigap (Medicare Supplement) ONCE, you can voluntarily disenroll from their plan anytime within the first 12 months of enrollment. If it has been more than 12 months since enrollment, there are limitations as to when you may disenroll. Read on.

First you have an Annual Election Period (AEP), which runs from November 15 through December 31. If you are in a Medicare Advantage Plan you can switch to Original Medicare (and a Part D Prescription Drug Plan) or you can switch to a different Medicare Advantage Plan. Changes will take effect January 1 of the following year.

Next you have an Open Enrollment Period (OEP) for Medicare Advantage that runs from January 1 through March 31 of each year. If you are in a Medicare Advantage plan with Prescription Drug coverage you may switch to another similar plan offered by another company or return to Original Medicare and select a stand-alone Part D Prescription Drug Plan. You may not switch to an Advantage Plan that does not provide Medicare Prescription Drug coverage.

There are a host of other complexities on the types of plans you may switch from or to. Remember: all of this is meant to provide you with options! Just imagine the vista of possibilities opening before you!

My best advice is to be aware that November 15 begins a time when you can make some changes. Do your homework and explore those changes.

Unfortunately, I do not have space for specifics. But once you locate a new plan, you’ll need to notify both your old plan and Medicare. KEEP COPIES OF EVERYTHING.

Get help from a knowledgeable friend, adult child, or counselor.

Occasionally government does work well. The US Marines are one example. Another good example is federal funding of state programs to help seniors with Medicare and other health insurance issues. They work well and have trained counselors.

In Georgia you may find help through the Coastal Georgia Area Agency on Aging. Call them at 1-800-580-6860 and scream “HELP!”. You can also call the GeorgiaCares State Health Insurance Information Program at 1-800-669-8387.

In South Carolina call the low country office of Insurance Counseling Assistance and Referrals for Elders Program (I-CARE) (whew!)at 843-726-5536 and scream “HEY-YELP!” (They sound different in South Carolina – my opinion). By the way, the South Carolina I-CARE website is excellent: www.state.sc.us/ltgov/aging/Seniors/ICARE.htm.

We need a KISS Program (Keep It Simple Silly), but I’m NHMB (Not Holding My Breath).

Next month, one of my favorite topics: Living Trusts . . . you might just be able to live without them.

Bob Mason, certified elder law attorney by the National Elder Law Foundation, practices in Savannah, Georgia, and Asheboro, North Carolina. Email Bob at ram@masonlawpc.com or visit www.masonlawpc.com.

Coastal Senior is a monthly periodical published in Savannah, Georgia and circulated throughout the Georgia and South Carolina low country. Bob Mason is its legal columnist.

Medicare can be confusing enough as it is. The past few years Medicare has gotten even more confusing with new “Part D Drug Plans” and the somewhat older “Medicare Advantage Plans” (which until recently had been called Medicare+Choice Plans). Whew.

To the chagrin of some insurance professionals, I am going to take a two-part swipe at Medicare Advantage Plans in this and my next column. Medicare Advantage Plans have been under scrutiny lately, and for a reason. If you are covered by one (and I bet you are not thrilled with it) or if you are thinking of switching to one read my words carefully.

Very aggressive (as in illegal) sales tactics have lured some seniors to switch to Advantage Plans, and then when the bloom is off the rose (and they realize they’ve been hoodwinked) many have difficulty backing out.

First, a bit of background on Medicare (I’ll try to keep this simple). The law divides Medicare into four parts. Part A and Part B are what many think of as “traditional” Medicare. Tried and true, they’ve been around for years. Part C covers Medicare Advantage Plans (under my knife below). Part D constitutes the newer prescription drug plans (I will not touch that here).

Medicare Part A has been the traditional route for medical coverage needed by the elderly and disabled in medical facilities. Part B applies to services provided by physicians and other medical practitioners, home health services, durable medical equipment and other services not covered by Part A. (For a more complete discussion of Medicare simply Google “Medicare” and read until you drop).

When combined with good Medicare supplemental insurance policies (popularly called Medigap policies) and the new Part D Drug plans, Part A and Part B provide fairly complete coverage. There are gaps, however.

Traditional Medicare, for example will not pay for most dental care, vision care, hearing care and preventive care. On the other hand, many Medicare Advantage plans offer to fill some of those gaps. But at a cost (and often hidden). For example there may be higher coinsurance amounts or deductibles, or other restrictions on who may provide services.

Some of the newer Medicare Advantage Plans may be patterned after health maintenance organizations, which offer a wide variety of services as long as the member uses participating providers.

Other Advantage plans may be patterned after preferred provider organizations and managed care organizations that offer broader service but hold down costs by preapproving services or placing other restrictions on the medical providers.

Most of the abuses do not involve these plans; they usually involve a type called a “Private Fee-for-Service” plan. These are sometimes called “PFFS Plans”.

So what IS a PFFS Plan? A PFFS Plan is a health plan offered by a private insurance company under contract with the Medicare program. This insurance plan is not a Medigap plan, and it works very differently. You must continue to pay the Medicare Part B premium to participate in the PFFS plan in addition to any additional premium the Private-Fee-for-Service plan may charge.

You may receive services from any doctor, hospital or other provider willing to accept your PFFS plan’s terms of payment. You may get, say, dental coverage . . . but end up paying very high co-insurance amounts for other services. Or you may find that your favorite doctor does not participate in your Medicare Advantage Plan. Or you may find that you no longer have drug coverage that you need.

Even though the marketing problems have involved PFFS Plans, do think very carefully before switching to any type of Advantage Plan; the deal may not be as “advantageous” as it first seemed.

Recently Medicare Advantage plans have come under close scrutiny by authorities after discovery of abusive PFFS hard-sell tactics by private insurers. In April, two Wellcare insurance salesmen were arrested in Columbus, Georgia, for a variety of aggressive and fraudulent sales tactics, including forging the signatures of elderly customers. Shortly after that authorities arrested another salesman after a series of forgeries and misrepresentations by the salesman to residents of a Suwanee (just north of Atlanta) nursing facility.

As a result of the increased “heat” from regulators, UnitedHealth Group Inc., Humana Inc., Wellcare Health Plans Inc., Universal American Financial Corp., Coventry Health Care Inc., Sterling Life Insurance Co. and BlueCross BlueShield of Tennessee recently agreed to suspend marketing of private fee-for-service Medicare plans because of complaints of deceptive practices by some of their agents. The suspensions will remain in effect until regulators are convinced that the companies have cleaned up their sales act.

That’s good news. The problem is that many seniors who are in Medicare Advantage Plans and who may want out are having a terrible time trying to get to the exit.

Stay tuned . . . I’ll cover that in next month’s column. In the meantime: Be careful. Look carefully before switching from traditional Medicare to a Medicare Advantage Plan.

Bob Mason, certified elder law attorney by the National Elder Law Foundation, practices in Savannah, Georgia, and Asheboro, North Carolina. Email Bob at ram@masonlawpc.com or visit www.masonlawpc.com.

Updated October 2011

Medigap insurance supplements Medicare’s benefits, which is why it is also called Medicare supplemental insurance. Both federal and state laws regulate Medigap coverage. A policy must be clearly identified as Medicare supplemental insurance and it must provide specific benefits that help fill the gaps in your Medicare coverage. Other kinds of insurance may help you with out-of-pocket health care costs, but they do not qualify as Medigap plans.

Standard Medigap Plans

There are now ten standard Medicare supplement insurance plans that help pay some of your costs in the original Medicare plan and for some care it doesn’t cover.

Each one of the standard Medicare Supplement insurance plans, labeled A through N (I know, I know . . . I said there are ten plans and A through N equals 14 letters . . . there are no longer E, H, I and J plans), offers a different set of benefits, fills different “gaps” in Medicare coverage, and varies in price. Some insurance companies offer a “high deductible option” on Medicare supplement insurance Plans F, and higher coinsurance amounts for some services in Plans K and L. All Medicare supplement insurance Plans must cover certain basic benefits. (Plans K and L are recent additions and very few supplemental Medicare insurers are offering those plans). Current Medicare rates are also posted elsewhere on this site.

• Basic Benefits
  • Covered by Medicare Supplement Insurance Plans A-N
• Medicare Part A Hospital Deductible
  • $1,132 in 2011 for each benefit period for hospital service
  • Covered by Medicare Supplement Insurance Plans B-G and Plan N (Plans K and M cover 50% and Plan L covers 75%)
• Skilled Nursing Home Costs
  • Your cost ($141.50 in 2011) for days 21-100 in a skilled nursing home
  • Covered by Medicare Supplement Insurance Plans C-G, M and N (plan K covers 50% and Plan L 75%)
• Medicare Part B Deductible
  • Yearly deductible for doctor services ($162 in 2011)
  • Covered by Medicare Supplement Insurance Plans C and F
• Medicare Part B Coinsurance
  • Generally 20% of services
  • All Plans (Plan K 50% – Plan L 75% – Plan N $20 office visits $50 ER visits)
• Medicare Part B Excess Charges
  • The difference between your doctor’s charge and the Medicare approved amount, if your doctor does not accept assignment.
  • Covered by Medicare Supplement Insurance Plans F (100%) and G (80%)
• Foreign Travel Emergency
  • 80% of the cost of emergency care outside the U.S.
  • Up to $50,000 in your lifetime
  • You pay a yearly deductible of $250
  • Covered by Medicare Supplemental Insurance Plans C-G, M and N

* If you choose the “high deductible option” on Medicare supplement plans F, you will first have to pay a $2,000 before the plan pays anything. This amount can go up every year. High deductible option policies often cost less, but if you get sick, your costs will be higher.

*Plans K and L provide for different cost-sharing for items and services than Plans A through J. Once you reach the annual limit ($4,640 for Plan K and $2,320 for Plan L), the plans pay 100% of the Medicare co-payments, coinsurance, and deductibles for the rest of the calendar year. The out-of-pocket annual limit does NOT include charges from your provider that exceed Medicare-approved amounts, called “Excess Charges.” You will be responsible for paying excess charges. the out-of-pocket annual limit will increase each year for inflation.

Insurance companies must use the same format, language and definitions when describing the benefits of each of the Medigap plans. They also must use a uniform chart (similar to the chart posted with this article) and outline of coverage to summarize the benefits. The idea is to make it easier for consumers to compare policies. As you shop for a Medigap policy, keep in mind that each company’s products are alike, so they are competing on service, reliability and price. Talk to your friends, neighbors, doctor and others who may have experience and an opinion.

Unlike some types of health coverage that restrict where and from whom you can receive care, Medigap policies generally pay the same supplemental benefits regardless of your choice of health care provider. If Medicare pays for a service, wherever provided, the standard Medigap policy must pay its regular share of benefits.

Medigap Premiums

Although the benefits are identical for all Medigap plans of the same type, the premiums may vary greatly from one company to another and from area to area. Insurance companies use three different methods to calculate premiums: issue age, attained age and no age rating.

If your company uses the issue age method, and you were 65 when you bought the policy, you will always pay the same premium the company charges people who are 65 regardless of your age. If it uses the attained age method, the premium is based on your current age and will increase as your grow older. Under the no age rating, everyone pays the same premium regardless of age. Your state insurance department must approve the rates charged for all Medigap policies. The insurance company can raise your premiums only when it has approval to raise the premiums for everyone else with the same policy.

Medicare SELECT

Another Medicare supplemental health insurance product called “Medicare SELECT,” is permitted to be sold by insurance companies or managed care plans throughout the country. Medicare SELECT is the same as standard Medigap insurance in nearly all respects. If you buy a Medicare SELECT policy, you are buying one of the standard Medigap plans. The only difference between Medicare SELECT and standard Medigap insurance is that each insurer has specific hospitals, and in some cases specific doctors, that you must use, except in an emergency, in order to be eligible for full benefits. Medicare SELECT policies generally have lower premiums because of this requirement.

When you go to the insurer’s “preferred providers,” Medicare pays its share of the approved charges and the insurer is responsible for the full supplemental benefits provided for in the policy. In general, Medicare SELECT policies are not required to pay any benefits if you do not use a preferred provider for non-emergency services. Medicare, however, will still pay its share of approved charges regardless of the provider you choose.

Medicare SELECT is authorized for sale until at least June 1998. At that time, if you have a Medicare SELECT policy, you will be able to either keep the SELECT policy with no changes in benefits or regardless of the status of your health, purchase another Medigap policy offered by the insurer, if the insurer issues Medigap insurance other than Medicare SELECT. To the extent possible, the replacement would have to provide similar benefits.

Open Enrollment Guarantees Your Right To Medigap Coverage

State and federal laws guarantee that for the first 6 months after the date you are both enrolled in Medicare Part B and age 65 or older, you have a right to buy the Medigap policy of your choice regardless of any health problems you may have. If, however, your birthday falls on the first day of the month, your Part B coverage (if you buy it) begins on the first day of the previous month, while you are still 64. Your Medigap open enrollment period would also begin at that time.

During this 6-month open enrollment period, you can buy any Medigap policy sold by any insurer doing Medigap business in your state. The company cannot deny or condition the issuance or effectiveness, or discriminate in the pricing of a policy because of your medical history, health status or claims experience. The company can, however, impose the same preexisting condition restrictions that apply to Medigap policies sold outside the open enrollment period. Preexisting conditions are generally health problems for which you saw a doctor within the 6 months before the date that the policy went into effect. Your Medicare card shows the effective dates for your Part A and/ or Part B coverage. To figure whether you are in your Medigap open enrollment period, add 6 months to the effective date of your Part B coverage. If the date is in the future and you are at least 65, you are eligible for open enrollment. If the date is in the past, you are generally not eligible. (If you were entitled to Medicare before age 65, see the following section on open enrollment and persons with disabilities.)

If you are covered under an employer group health plan when you become eligible for Part B at age 65, carefully consider your options. Once you enroll in Part B, the 6-month Medigap open enrollment period starts and cannot be extended or repeated.

If you are covered under an employer plan that is primary to Medicare in paying your medical bills, you will not need a Medigap plan until you are no longer covered under the employer plan. If you begin buying Part B as a supplement to your employer plan while it is the primary payer, you will start your Medigap open enrollment period when it is of little use to you.

You may, therefore, want to wait to buy Part B until you are ready to make optimum use of your Medigap open enrollment period. Also keep in mind that if you have already triggered your Medigap open enrollment period at age 65, you cannot get another one by dropping Part B and re-enrolling during a special enrollment period after you are no longer covered under the employer plan.

Medigap Open Enrollment and the Persons With Disabilities

If you become eligible for Part B benefits before age 65 because of a disability or permanent kidney failure, federal law guarantees you access to the Medigap policy of your choice when you reach age 65. During the first 6 months you are age 65 and enrolled in Part B, you can buy the policy of your choice regardless of whether you had enrolled in Part B before you were 65.

During these 6 months, you cannot be refused a policy because of your disability or for other health reasons. Moreover, you cannot be charged more than other applicants, which can greatly reduce the amount you are paying. A waiting period of up to 6 months, however, may be imposed for coverage of a pre-existing condition.

Several states go beyond federal law and require at least a limited open enrollment for Part B beneficiaries under 65. Check to see whether your state does. In addition to any state requirement, federal law requires that you be given an open enrollment opportunity when you turn 65, even if you were previously entitled to open enrollment under state law.

Guaranteed Renewable

All standard Medigap policies are guaranteed renewable. This means that the insurance company cannot refuse to renew your policy unless you do not pay the premiums or you made material misrepresentations on the application. Older Medigap policies (sold before 1992) may allow the company to refuse to renew on an individual basis. These older policies provide the least permanent coverage.

Older Medigap Policies

Many federal requirements do not apply to Medigap policies sold before 1992, when Medigap was standardized. There is generally no requirement that you switch to one of the standard plans if you have an older policy. However, you may be required to switch if your older plan was not guaranteed renewable and the company discontinues the type of policy you have. Check with your state insurance department to find out what state-specific requirements are in force.

Switching Medigap Policies

Even if you are not required to convert an older policy, you may want to consider switching to one of the standardized Medigap plans if it is to your advantage and an insurer is willing to sell you one. If you do switch, you will not be allowed to go back to the old policy. Before switching, compare benefits and premiums, and determine if there are waiting periods for any of the benefits in the new policy. Some of the older policies may provide better coverage, especially for prescription drugs and extended skilled nursing care. On the other hand, older Medigap polices, which cannot be sold to new applicants, may experience greater premium increases than newer standardized policies that can enroll new applicants (younger, healthier policyholders whose better claims experience will help to moderate premiums).

If you have had a Medigap policy for at least 6 months and you decide to switch, the replacement policy generally cannot impose a waiting period for a preexisting condition. If, however, a benefit is included in the new policy that was not in the old policy, a waiting period of up to 6 months–unless prohibited by your state–may be applied to that particular benefit.

You do not need more than one Medigap policy. If you already have a Medigap policy, you must sign a statement when you buy another indicating that you intend to replace your current policy and will not keep both policies. However, do not cancel the old policy until the new one is in force and you have decided to keep it.

Use the “Free-Look” Provision

Insurance companies must give you at least 30 days to review a Medigap policy. If you decide you don’t want the policy, send it back to the agent or company within 30 days of receiving it and ask for a refund of all premiums you paid. Contact your state insurance department if you have a problem getting a refund.

Carrier Filing of Medigap Claims

Under certain circumstances, when you receive medical services covered by both Medicare and your Medigap insurance, you may not have to file a separate claim with your Medigap insurer in order to have payment made directly to your doctor or medical supplier.

By law, the Medicare carrier that processes Medicare claims for your area must send your claim to the Medigap insurer for payment when the following three conditions are met for a Medicare Part B claim:

• Your doctor or supplier must have signed a participation agreement with Medicare to accept assignment of Medicare claims for all patients who are Medicare beneficiaries;
• Your policy must be a Medigap policy; and
• You must instruct your doctor to indicate on the Medicare claim form that you wish payment of Medigap benefits to be made to the participating doctor or supplier. Your doctor will put your Medigap policy number on the Medicare claim form.

When these conditions are met, the Medicare Carrier will process the Medicare claim, send the claim to the Medigap insurer and generally send you an Explanation of Medicare Benefits (EOMB) or Medicare Summary Notice (MSN). Your Medigap insurer will pay benefits directly to your doctor or medical supplier and send you a notice that it has done so.