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Medicare and Medicaid Medicare and Medicaid Coordination of Benefits Coordination of Benefits
Rebecca PhillipsTraining Specialist
MMAP Inc.MMAP Inc.We are Michigan’s State Health
Insurance Assistance Program (SHIP) ◦MMAP (Michigan Medicare/Medicaid
Assistance Program) Federal funding for the program
began in 1991Each state has their own SHIPMost SHIPs are operated by the
State, however, MMAP Inc. is a non-profit
All rely heavily on volunteers
MMAP’s MissionMMAP’s Mission
To educate, counsel and empower Michigan’s older adults and
individuals with disabilities, and those who serve them, so that they can make informed health
benefit decisions
MMAP’s VisionMMAP’s Vision
MMAP is the recognized leader in providing high quality and accessible health benefit information and counseling supported by a statewide network of unpaid and paid skilled professionals.
What is Medicare?What is Medicare?
What is Medicare?What is Medicare?Federal Health Insurance for:
◦People 65 years of age or older◦Some persons with disabilities, after
a 24 month waiting period – Must be deemed by Social Security
◦People with End-Stage Renal Disease◦People with Amyotrophic Lateral
Sclerosis (ALS)
Medicare Plan ChoicesMedicare Plan ChoicesOriginal Medicare
◦Part A- Hospital Insurance◦Part B- Medical Insurance◦Part D- optional Prescription
InsuranceMedicare Advantage
◦Health Plan (HMO, PPO, PFFS) offered by private health plans
◦Sometimes referred to as Part C
Original MedicareOriginal MedicarePart A- Hospital Insurance
◦Covers Hospital stays Skilled nursing facility care Hospice care
◦Costs $1068 deductible a hospital stay of 1-60 $267 per day for days 61-90 hospitalization Paid for through FICA taxes; therefore
anyone who has 40 work credits (about 10 years) does not pay a premium for Part A
Original Medicare- Part A Original Medicare- Part A cont.cont.Also covers skilled nursing facility
after a 3 day hospital stay for care relating to hospital treatment
Covered in full for first 20 days.
Original MedicareOriginal MedicarePart B- Medical Insurance
◦Covers Outpatient services, such as doctor’s
visits, ambulance, lab, x-rays, medical equipment
◦Costs Monthly premium of $96.40 for most
people Annual deductible of $135 20% co-pay for most services
MedigapMedigapSold by private insurance
companiesFills the gaps of Original MedicareCurrently 12 standard plans “A-L”Set core benefits for each
standard planCosts varyMIPPA – number of changes to
Medigaps coming in June of 2010
MedigapMedigapHelps pay the costs with Original
MedicareDon’t need Medigap if you are
◦In a Medicare Advantage plan◦Have retiree coverage ◦Have Medicaid
What Medigap PaysWhat Medigap PaysCo-insurance amounts for Part B
(20%)Some policies cover deductibles
for Part A and/or Part BSome policies offer additional
benefits, like Foreign Travel Emergency or Routine Checkups
Part D- Prescription Part D- Prescription CoverageCoverageMedicare Prescription Drug
Coverage is part of the Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA)
First time Medicare provided prescription coverage for outpatient prescription drugs
Who is Eligible for Part D?Who is Eligible for Part D?Anyone who has Medicare Part A and/or Part B
Enrollment is voluntaryIn most cases, beneficiary must
choose and join a Medicare drug plan to get coverage
Medicare Part D CostsMedicare Part D CostsFor coverage in 2009, beneficiaries
will generally pay…◦ A monthly premium◦ $295 deductible◦ 25% of yearly drug costs from $295 to
$2700◦ 100% of drug costs from $2700 to
$6153.75◦ 5% of drug costs (or smaller co-payment)
after $4350 true out-of-pocket expenses
Standard Benefit Structure Standard Benefit Structure Chart Chart
5%
$3,453.75 Gap
25%
Deductible
PartialCoverage
No Coverage
CatastrophicCoverage
+ Monthly Premium
Out-of-Pocket Drug Spending in 2009 for Medicare Part D Basic Benefit
Medicare Part D Benefit
Beneficiary Spending
$6,153.75*
$2,700*
$295*
* Numbers represent actual prescription drug cost.
Types of Part D PlansTypes of Part D PlansOffered by private companiesApproved by MedicareTwo Types
◦Prescription Drug Plans (PDPs)◦Medicare Advantage (MA-PDs)
Medicare AdvantageMedicare AdvantageChanges the structure of Medicare benefitsOffered by Private Insurance companies
who have contracted with MedicareMedicare Advantage Plan is primarySubject to co-paysPlans can be HMO, PPO, Private Fee for
Service – basically these are Managed Care plans
Medicare Advantage wraps Medicare, supplement and prescription drugs into one policy
Must be enrolled in both A & B
Medicare Advantage CostsMedicare Advantage CostsStill Pay Part B premiumMay have a Medicare Advantage
PremiumPay associated co-pays and
deductibles for medical care
What is Medicaid?What is Medicaid?
What is Medicaid?What is Medicaid?Medicaid provides medical insurance
to groups of low-income individuals and families that may have inadequate or no medical insurance.
In Michigan, Medicaid has over 30 health care programs for children, families and adults who meet eligibility criteria. ◦This presentation will focus on those
that are 65 or older, blind, or disabled.
Medicaid - AdministrationMedicaid - AdministrationThe Federal government sets general
guidelines for the Medicaid program, but each state determines the policy rules and regulations of their program.
The Michigan the Department of Community Health (MDCH) oversees this program and local Department of Human Services (DHS) offices administer the program.
DHS offices are usually located at the County level.
What does Medicaid What does Medicaid Cover?Cover?Federal law and regulations require
that states provide to qualifying older adults and person with disabilities a set of mandatory benefits:◦ Inpatient hospital services◦Outpatient hospital services and rural
health clinic services◦Other lab and x-ray services◦Skilled nursing facility services◦Physicians’ services◦Home heath care services
What does Medicaid What does Medicaid Cover?Cover?Many states offer a some
optional benefits as well, which may include:◦Dental◦Chiropractic◦Hearing aid services◦Podiatry◦Vision◦Occupational and speech therapy
Medicare Savings Medicare Savings ProgramsProgramsThese are programs developed to help pay the
premiums, deductibles, and copays for Medicare. ◦ QMB (Qualified Medicare Beneficiary) – pays Part B
premium, Part A & B deductibles, and all Medicare copays.
◦ SLMB (Specified Limited Medicare Beneficiary) – pays Medicare Part B premium.
◦ ALMB-QI-1 (Additional Low-Income Medicare Beneficiary) – pays Medicare Part B premium (not an entitlement)
These programs are administered by Medicaid and they have asset and income limits
A beneficiary may have both Medicaid and a Medicare Savings Program
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Medicare Secondary Medicare Secondary Payer Rule and Payer Rule and Coordination of BenefitsCoordination of Benefits
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Medicare Secondary Payer Rule Medicare Secondary Payer Rule and Coordination of Benefits and Coordination of Benefits Medicare Secondary Payer (MSP) Rule
requires other insurers to pay before Medicare◦Federal law passed in 1980 created this rule,
prior to this Medicare was always primary◦Determination is made based on other
available insurance◦MSP applies if the other insurance available
is: Employer Group Health Plans for current employees
and their dependents (the “working aged”) Worker’s Compensation Insurance Automobile and Liability Insurance
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Medicare Secondary Payer Rule Medicare Secondary Payer Rule and Coordination of Benefitsand Coordination of BenefitsMedicare Secondary Payer Rule and
Employer Group Health Plans (EGHP)◦ If the person covered by Medicare or
his/her spouse is still working and covered by EGHP, the EGHP is primary for: Employers with 20 or more employees For persons with disabilities, rule applies to
employers with 100 or more employees◦These beneficiaries do not need to take
Part B while they are covered by the EGHP. Once they retire or lose the EGHP they will need to enroll in Part B.
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Medicare Secondary Payer Rule Medicare Secondary Payer Rule and Coordination of Benefitsand Coordination of BenefitsMedicare is primary with the
following:◦Medicare Supplement (Medigap)
insurance◦Retiree group insurance – acts as a
supplement◦TRICARE for Life for military retirees◦Medicaid◦Generally, where the terms of the
contract say that the insurance pays second to Medicare
MedicareMedicareGeneral rule with Medicare: If
Medicare is Primary, the beneficiary must have both A and B before a secondary insurance will pick up any part of a claim.
Side note: if the beneficiary does not enroll in Part B when he/she first became eligible he/she may have to pay a late enrollment penalty.
Crossover AgreementCrossover AgreementMedicare has agreement with
other insurance companies that allows Medicare to send claims directly to the other insurance carrier automatically for processing.
This eases the claims process for the beneficiary.
MedicaidMedicaidGeneral rule with Medicaid: Medicaid always pays last. ◦If there is a possibility that another
insurer or payer is available to pick up a claim Medicaid will not pay for that claim until it is proven otherwise.
Common Areas of Common Areas of ConfusionConfusionCOBRA
◦Medicare is primary with COBRA (except for when End-Stage Renal Disease is involved)
◦Delay in disability claims at Social Security complicates this issue Since SSA is sometimes years behind in
processing disability claims it is not uncommon for someone to be eligible for Medicare retroactively.
When this happens the COBRA coverage will take back their payments to providers stating that Medicare should have paid.
This is where I see the most problems with beneficiaries being sent to claims.
Common Areas of Common Areas of ConfusionConfusionMedicare Advantage Plans
◦Will not coordinate with Medigap Plans◦Most are not set up to coordinate with
Medicaid or other insurance benefits (retiree) May be able to get secondary insurance
(Medicaid) to pick up deductibles or copayments but if a contract is not in place the chances are very slim.
◦Exception - Special Needs Plans (SNPs): Medicare Advantage plans that have a contract with Medicaid
Common Areas of Common Areas of ConfusionConfusionWhat if someone has Medicare, a
retiree plan and Medicaid? ◦Medicare would be primary◦The Retiree plan would pick up the
pieces it will cover after Medicare pays their part.
◦Medicaid will then come in and possibly pick up anything that is left. In reality, there usually would be very little for Medicaid to pick up in this situtation.
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