All About Medicare (NY)

All About Medicare in New York State

Jennifer LavelliPersonal Insurance and Medicare Advisor

[email protected]

Agenda• What is Medicare, and How Do I

Enroll?

• How Medicare Works with Private Insurance: Three Ways to Complete Your Medicare Coverage

• Impacts of the Affordable Care Act, and Resources to Help Reduce Your Costs

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Agenda – Part 1

• What Medicare Is

• How and When to Enroll

3

Part 1: Key Takeaway

If you do not enroll in Medicare on time, you will pay a monthly

penalty

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What Is Medicare?

• National health insurance program for people 65+

• Administered by the Centers for Medicare and Medicaid Services (CMS)

• Enrollment through the Social Security Administration (SSA)

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Who Is Eligible for Medicare?

• Everyone over 65– All U.S. citizens– Legal residents who have lived in the

U.S. continuously for at least 5 years

• Some people under 65 who receive Social Security disability benefits

6

Usually→

Four Parts of Medicare

Part A

Hospital

Insurance

Federal/State

Part BMedicalInsuran

ceFederal/

State

Part C

Medicare

Advantage Plan

Insurance company

Part DPrescription Drug Coverage Insurance company

7

Enrollment Periods• Initial Enrollment: 3 months before, the month of,

and 3 months after your 65th birthday. • Special Enrollment: For people who did not sign

up for Parts B and D during their initial enrollment period because they were covered as a worker, or spouse of a current worker, by a large (≥20 employees) group plan.– Special enrollment period for Part B is anytime before

coverage ends, or for the 8-month period starting the month group coverage ends

– Special enrollment period for Part D is anytime before coverage ends, or within 63 days after coverage ends

• General Enrollment: People that missed their Initial Enrollment period can sign up between Jan 1 – Mar 3, though coverage won’t start till July 1

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Enrollment Periods (cont’d)

• Annual Election Period: From October 15 – December 7, people who are already enrolled in a Medicare plan and want to CHANGE their coverage can do so

• Medicare Advantage Unenrollment Period: People who decided to try a Medicare Advantage plan can drop it and switch back to Original Medicare (ONLY) from Jan-Mar of the following year. These people MUST go back to Original Medicare, though they can add a Medigap Policy and a Part D

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Initial Enrollment: Medicare Parts A & B

• You must be enrolled for Parts A and B to avail yourself of any of the three options to complete your Medicare coverage

• Enroll when you’re first eligible (age 65) to ensure you incur no penalties or delays in coverage

• If you are receiving Social Security when you turn 65:– Medicare Parts A and B are automatic

(can decline if don’t need Part B due to other coverage) – Coverage starts 1st of month turn 65– Parts C and D are not automatic; must choose private insurer and

proactively enroll

• If you are not receiving Social Security when you turn 65:– Must sign up through Social Security Administration during

a Medicare enrollment period

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Initial Enrollment: Part D

• When you’re signed up for Parts A and B and know you’ll want prescription drug coverage, either now or at any time in the future– Must sign up when first eligible (at 65) or face

late enrollment penalty (unless covered by another drug plan with coverage at least as comprehensive as Medicare — called “creditable” coverage)

– Obtain Part D by calling your preferred insurer, calling Medicare, or working with an insurance advisor (like me!)

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If You Don’t Enroll in Medicare During Your Initial

Enrollment Period…• You may pay late-enrollment

penalties for Parts B and D for the rest of your life

• Your health care expenses may not be covered by insurance due to delayed coverage

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Agenda Part 2: How to Complete Your Medicare

Coverage• There are three ways to complete your

Medicare coverage1. Original Medicare Parts A & B with a Part D

prescription drug plan2. Addition of a Medical Supplement (aka

Medigap Plan) to Option #1 above to cover deductibles, co-pays, and coinsurance for Parts A and B

3. Purchase a Part C plan from a private insurer13

Part 2: Key TakeawaysEvaluate all three options before

deciding - - premiums and total out-of-pocket costs and covered services will differ, sometimes dramatically

If you do not get the right private insurance to go with Medicare, your doctors and prescriptions may not

be covered 14

Part AHOSPITAL$0 premium

Part BDOCTORS

$104.90 base

premium

Medical SupplementsLetters A Through N

Monthly Premiums vary by Plan and Carrier

Part DPRESCRIPTION DRUGSVarying Monthly Premium Copayments Vary by Tier

FIRST Way to Complete Your Medicare Coverage

Original Medicare (Parts A and B) and Part D = Option 1

Part CMedicare Advantage

PlanHospital+Doctors+Pa

rt D +Extras$0 or Low

Monthly Premiums, though

Part B Premium continues

Pay Copayments Up to the

Maximum Out-of-Pocket (MOOP)

What Original Medicare Parts A and B Cover

• Hospital: 100% of first 60 days• Medical services (doctor visits, outpatient

services): 80% of Medicare-approved amount (varies)

• Some preventive services (flu shots, certain screenings)

See “Medicare & You 2013” for complete list of covered services. Call 800-663-4227 or go to www.medicare.gov.

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What Original Medicare Parts A and B Do Not Cover

• Long-term care• Care delivered outside the U.S.• Dental care• Vision care• Hearing aids• Cosmetic surgery• Acupuncture and other alternative care• Amounts over Medicare-approved amount

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2013 Out-of-Pocket Costs for Original Medicare Parts A

and B• Premiums for Part B paid to Medicare

(usually $104.90; people with incomes over $85,000 will pay more)

• Deductibles ($1,184 for Part A; $147 for Part B)

• Copays and Coinsurance• Services not covered by Medicare, or

provider charges over the Medicare-approved amount 18

PART D: Prescription Drug Plans

• EVERYONE must have creditable drug coverage– If you’re not covered by another creditable plan, you MUST

purchase Part D when you’re eligible or face penalties later

• Part D is purchased from a private insurer as a standalone supplement to Original Medicare Parts A and B

• Each drug plan has its own list of coverage drugs (formulary)– Brand name and generics are grouped into “tiers”, each with

different copays/coinsurance

• Premiums, co-pays, and coinsurance amounts for Part D plans vary by insurer, by plan, and by geography 19

Part D coinsurance 2013Medicare’s standard benefit design; individual plans vary and may pay

more Coverage Part D plan pays You pay

Annual deductible (varies by plan)

$0 Applicable co-pay

Initial coverage period (up to $2,970 including deductible)

75% Varies by plan 25% Varies by plan

Coverage gap (donut hole) Starts when costs exceed $2,970; ends when total out-of-pocket cost reaches $4,750 )

Probably $0 47.5% of covered brand name drugs plus dispensing fee; 79% of covered generic drugs; 100% of rest.

Catastrophic coverageStarts when total out-of-pocket cost reaches $4,750

95% or the drug cost minus the copay

Greater of 5% of the drug costs or $2.60 copay for a generic drug or $6.50 for a brand name drug

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The Second Way to Complete Your Medicare Coverage: Add Coverage and Reduce Out of

Pocket Costs

Add a Medigap plan (aka a Medicare Supplement) to Original Medicare Parts A, B, and D

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Part BDOCTORS

$104.90 base

premium




SECOND Way to Complete Your Medicare Coverage

Add a Medical Supplement to Original Medicare (Parts A and B) and Part D =

Option 2








Medigap Policies(Medicare Supplement

Insurance)• Private health insurance sold by private

insurance companies• Supplements Original Medicare coverage

Parts A and B• Follow federal/state laws that protect you• Can be purchased anytime after enrolling

in Part B, though pre-existing conditions may be excluded for a limited time

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Medigap Policies(Medicare Supplement

Insurance)• Insurance companies can only sell a

“standardized” Medigap policy– Identified in most states by letters (NY = A

through N)

• You pay a monthly premium that varies by plan by plan, insurance company, and your location

• Go to any Medicare-approved doctor

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Medigap PoliciesMedigap Benefits A B C D F G K L M NMedicare Part A coinsurance and hospital costs up to an additional 365 days after Medicare benefits are used up

Medicare Part B coinsurance or copayment 50% 75%

Blood (first 3 pints) 50% 75%

Part A hospice care coinsurance or copayment

50% 75%

Skilled nursing facility care coinsurance 50% 75%

Medicare Part A deductible 50% 75%

Medicare Part B deductible

Medicare Part B excess charges

Foreign travel emergency (up to plan limits)

Plan F has a high-deductible optionOut-of-pocket limit for Plan K = $4,660, for Plan L = $2,330

Source: Choosing a Medigap Policy, CMS and NAIC http://www.medicare.gov/Publications/Pubs/pdf/02110.pdf 25

What a Medigap Policy May Cover in Full or Part

• Deductibles and coinsurance amounts, such as:– The $1,184 deductible for Part A– Hospital costs after 60 days– The 20% of doctor bills that Medicare doesn’t pay– Amounts the doctor charges over the Medicare-

approved amount

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Part BDOCTORS

$104.90 base

premium




THIRD Way to Complete Your Medicare Coverage

A Private Insurance Company’sEnhanced Medicare Program = Option

3








Medicare Advantage Plans Replace your Original

Medicare Coverage• Private insurance sold by private insurance companies• Known as PART C - - deliver the same benefits (or

more) as Original Medicare Parts A and B• Follow federal/state laws that protect you• Medicare pays most of the premium for each member’s

care• May have to use network doctors or hospitals• Most plans offer prescription drug coverage• Many include extra benefits like vision, dental,

hearing aids, Silver Sneakers• Benefits and cost-sharing differ from Original

Medicare AND between plans 28

Shop Carefully for Private Insurance

• Medicare supplement plans are standardized but premiums vary considerably ➡Choose the policy that offers the coverage you need

(A-N)➡Choose a reputable company offering that policy at

the lowest price➡Make sure your health care provider processes the

billing for the company you choose• Drug plan benefits vary considerably

➡Choose the plan offering the coverage you need for the medicines you take

• Medicare Advantage plans (Part C) also vary considerably➡Choose the plan offering the coverage you need at a

fair price 29

What to Consider When Choosing Coverage

• Costs - - evaluate premiums, deductibles, and total potential out of pocket

• Do they contract with your doctors, hospitals, pharmacies?

• Insurance Provider ratings (for Medicare Advantage and Part D plans)

30These are the Services I Provide!

Agenda Part 3: The Affordable Care Act and

Additional Resources• How will the Affordable Care Act

Impact Medicare?• Resources That May Help to

Reduce Your Costs

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Part 3: Key Takeways

• The Affordable Care Act includes additional benefits for Medicare recipients

• Don’t wonder - - call and ask about additional resources!

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The Affordable Care Act and Medicare: No Cuts

to Benefits• Reduced spending growth extends Medicare solvency until 2026

• More help with prescription drug costs– 2013 you pay less than half (47.5% of what your plan

charges for brand name drugs. For generics, you pay 79%

– 2020 The donut hole will be slowly phased out and completely eliminated

• Free annual wellness checkup and a range of prevention services, including cancer and diabetes screenings

• Bonuses to primary care doctors to improve access33

National Council on Aging: Straight Talk for Seniors on Health Reform: www.NCOA.org

Popular Medicare Resources

• EXTRA HELP: A Medicare program to help people with limited income pay prescription drug costs, such as premiums, deductibles and coinsurance.

• EPIC: The Elderly Pharmaceutical Insurance Coverage Program is a free New York State program that helps more than 280,000 income-eligible seniors aged 65 and older to supplement their out-of-pocket Medicare Part D drug plan costs. Seniors can apply for EPIC at any time of the year and must be enrolled or eligible to be enrolled in a Medicare Part D drug plan to receive EPIC benefits and maintain coverage.

• Medicare Savings Programs: help from your state paying your Medicare premiums. May also pay Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) deductibles, coinsurance, and copayments if you meet certain conditions 34

Determine Your Eligibility for Additional

Benefits• Go to medicare.gov or call 1-800-

Medicare• Go to BenefitsCenter.org

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Thank you!

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All About Medicare (NY)