Answers to help you make the right decisions.
The annual election period runs from October 15 through December 7. During this time, those on Medicare have to make decisions and select options that will affect their health and financial wellbeing.
In the weeks leading up to October, Medicare beneficiaries will receive between five and ten pounds of printed materials, all containing information about Medicare benefits and options. Most of this unsolicited mail is required by the Center on Medicare and Medicaid Services (CMS), to inform beneficiaries of any changes to the plans they currently have and to reinforce the basic benefits of original, or standard, Medicare.
Medicare does not lend itself to simple explanation. With the influx of information pouring in, many people become overwhelmed and can get easily confused when it comes to making decisions about Medicare and supplement coverage.
Medicare does not lend itself to simple explanation. Like all health insurance coverage, little appears to be
in black or white, with gray areas dominating specific landscape. Sifting and sorting through all of the Medicare paperwork is a daunting task, most people simply want to know where they can easily find answers to their specific questions and concerns about their coverage.
The best place to start is at the beginning, which is original Medicare, often referred to as standard Medicare. Original Medicare consists of two parts, A and B, both of which carry annual deductible amounts that the patient must meet before Medicare coverage begins.
Part A covers services of medical entities: hospitals, skilled nursing care facilities, home health care and hospice care treatment. Part A does not have a cost for those that have worked over 40 quarters and contributed into the fund.
Part B is optional but it non-institution expenses, like doctor office visits, inoculations, medical tests and other outpatient services. This optional coverage currently costs $104.90 per month, unless your income exceeds $85,000. For those receiving monthly Social Security payments, the government will deduct this premium for you.
Generally, original Medicare will pay 80% of the approved medical bills, leaving the beneficiary to pay the balance out of pocket. This is where the need to make informed decisions begins. And this is where the typical beneficiary needs assistance to sort through the stack of printed material on the kitchen table.
There are currently three different choices for Medicare recipients:
1. A popular choice is to do nothing or add an Rx plan, called Part D, to reduce the cost of prescription drugs. Part D coverage can be a wonderful benefit for seniors who must continue a regimen of expensive medications on a regular basis.
2. Another is to enroll in a supplement plan. Supplement plans are offered by independent insurance companies and regulated by CMS. Supplements are identified by alphabet codes (A, B, C, H, K, L, N, etc., etc.) adding to the confusion. Each letter defines what the plan pays for and how much the beneficiary is responsible for. For example, all Plan F supplements cover the balance that original parts A & B do not cover, no matter which insurance company offers it. However, regardless of which insurer offers a supplement, all pans with the same alphabetic designation are the same in benefits although they may not be priced the same. This is an area where a trusted, unbiased advisor can offer great assistance.
3. A third choice, rapidly gaining in popularity is Part C, or Medicare Advantage Plan. These plans, offered by independent insurers under CMS regulation, most times offer a combination of Parts A, B and D. The advantage plans offer a lower cost of reducing the medical expenses because CMS pays a major part of the premium to the private insurer. Part C enrollment is increasing because it effectively replaces Parts A and B and it contains additional services like dental and vision as well.
Here is just one example of how a Part C plan helped a particular client save substantial out of pocket expenses. This person was hospitalized for over 30 days, the bill was over $600,000 but after his Advantage Plan benefits, he was personally responsible for less than $3,000 and he has no monthly premium.
If you or a loved one have any questions about the different parts of Medicare and their costs, please don’t hesitate to speak up and ask questions. As you can see, from the above example, the right decision can affect both health and wellbeing for years to come.
Vincent J Spineli – Licensed Insurance Agent