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NAHU Web seminar on Medicare Basics

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  • 1. Medicare Basics 2005 Part 1 Presented by The National Association of Health Underwriters Education Foundation
  • 2. Medicare Program Basics
    • Medicare is a health insurance program for:
      • People age 65 or older
      • People under age 65 with certain disabilities,
      • People of all ages with end-stage renal disease (permanent kidney failure requiring dialysis or a kidney transplant)
    • Medicare has two basic parts:
      • Part A Hospital Insurance
        • (Most people don’t pay a premium for Part A), and
      • Part B Medical Insurance – usually out of the hospital
        • (Most people pay a monthly premium for Part B - $78.20 in 2005)
        • The cost of Part B may go up 10% for each full 12-month period that you could have had Part B but didn’t enroll and your Part B coverage as a late enrollee will start on July 1 of the year you enroll. This additional cost is permanent.
  • 3. Medicare Basics
    • People who are already getting benefits from Social Security or the Railroad Retirement Board are automatically enrolled in Part A starting the first day of the month they turn age 65.
    • If a person under age 65 qualifies for Social Security or Railroad Retirement Board disability payments, they will be automatically enrolled in Medicare after they have received those payments for 24 months.
    • Even though some people are now scheduled to initially become eligible to receive Social Security benefits after age 65, they will still be eligible for Medicare at age 65.
  • 4. Medicare Part A
    • Part A covers inpatient care in hospitals.
    • For each episode of care in a hospital you pay $912 for a stay of up to 60 days, $228 per day for days 61-90 of a hospital stay and $456 per day for days 91-150 of a hospital stay. You are responsible for charges beyond 150 days for a hospital stay.
    • Part A also covers certain types of skilled nursing care but not custodial long term care. You pay nothing for the first 20 days and $114 per day for days 21-100. You are responsible for all costs beyond 100 days.
  • 5. Hospital and Skilled Nursing Facility Care
    • Hospitals stays must be for medically necessary care.
    • Part A covers a semiprivate room, and most other hospital charges, but not a private room or private duty nursing, television, or telephone.
    • Critical access hospitals are also covered as well as mental health facilities.
    • Inpatient mental health care in a psychiatric facility is limited to 190 days in a lifetime.
    • Skilled nursing for rehabilitative services is covered after a related three-day inpatient hospital stay.
  • 6. Home Health Care and Blood
    • Home health care is limited to medically necessary part-time skilled nursing care and home health aide services as well as physical therapy, occupational therapy, and speech-language therapy which are ordered by your doctor.
    • Also covered are medical social services, durable medical equipment (such as wheelchairs, hospital beds, oxygen, and walkers, medical supplies, etc). You pay 20% of the Medicare approved amount for these services.
    • You pay for the first three pints of blood.
  • 7. Hospice care
    • Hospice care is care for people with a terminal illness, including drugs for pain relief and other services from a Medicare-approved hospice, including some services that would not otherwise be covered by Medicare.
    • Hospice care is usually given at home, however, Medicare covers some short-term hospital and inpatient hospice care for respite purposes.
    • You pay up to $5 for outpatient prescription drugs that are part of a Hospice Program and 5% of the Medicare approved amount for hospice inpatient respite are.
  • 8. Medicare Part B
    • Covers doctors’ services and outpatient care
    • You pay a $110 (2005) deductible each year before Medicare starts to pay its share and 20% coinsurance on the balance of most Medicare approved charges for your medical expenses covered by Part B.
    • If your income is low, you may qualify for help from your state to pay both your Medicare Part B premium and the annual deductible.
    • Enrolling in Part B is automatic unless you notify Medicare that you don’t want to enroll.
    • Premiums for Part B are usually deducted from your Social Security, Railroad retirement, or Office of Personnel Management retirement check.
  • 9. Medicare Part B Special Enrollment Period
    • If you waited to enroll in Part B because you or your spouse were working and had group health plan coverage as an active employee, you are eligible for a special enrollment period for Part B.
    • This time period can be any time you or your spouse are still covered as an active employee by an employer or union group health plan or during the eight months following the month that the employer or union group health plan coverage ends, or when the employment ends, whichever is first.
    • Most people who sign up for Medicare during a special enrollment period don’t pay an extra premium.
  • 10. Part B Premiums
    • Currently the federal government pays 75% of all Part B premiums.
    • All beneficiaries under $80,000 (single) $160,000 (couple) will continue to get the 75% government subsidy and pay 25% of the cost of Part B premiums, as they do now.
    • Beneficiaries with incomes above these levels will pay a greater share of Part B premiums on a sliding scale.
  • 11. Part B and COBRA Coverage
    • Coverage under COBRA is not considered coverage as an active employee.
    • If you elect COBRA when you leave your employer’s plan, you should also consider electing Part B if you haven’t already done so since your special enrollment period will end eight months after you lose coverage as an active employee.
  • 12. Signing up for Part B
    • You may also find that your employer plan will require you to sign up for Part B even before your coverage as an active employee ends in order to receive full benefits under the plan.
    • Signing up for Part B triggers a six-month Medigap open enrollment period.
    • For this reason it is very important to consider all of your options before deciding on the best time to sign up for Part B.
  • 13. What Part B Covers - Preventive
    • Preventive Services
      • Bone Mass Measurements every 24 months for qualified individuals
        • you pay 20% for this service after your Part B deductible
      • Cardiovascular Screening blood tests
        • This service is covered at 100% of Medicare approved charges with no deductible, once every five years
      • Pap Test and Pelvic Examination
        • Once every 24 months for all women with Medicare and every 12 months for those at high risk
          • You pay 20% of the Medicare approved amount with no deductible for the pelvic exam and nothing for the pap test.
  • 14. What Part B Covers - Preventive
      • Colorectal cancer screening
        • Fecal Occult Blood Test every 12 months
          • Medicare pays 100% with no deductible
        • Flexible sigmoidoscopy once every 48 months
          • you pay 25% after the deductible - must be outpatient
        • Screening Colonoscopy every 24 months if you are at high risk for colon cancer or every 10 years if not at high risk (but not within 48 months of a screening sigmoidoscopy)
          • you pay 25% after the deductible - must be outpatient
        • Barium enema every 24 months if you are at high risk for colon cancer or every 48 months if you are not high risk.
          • you pay 20% after the Part B deductible
        • You must be age 50 or older for these tests, except there is no minimum age for a colonoscopy
  • 15. What Part B Covers - Preventive
      • Glaucoma Testing
        • Once every 12 months for people who have diabetes or have a family history of glaucoma or who are African Americans age 50 and older
          • You pay 20% of the Medicare approved amount after the Part B deductible
      • Diabetes Services
        • Diabetes screening tests including fasting plasma glucose test for certain people who are at risk for diabetes
          • Medicare pays 100% for these services with no deductible
        • Diabetes self-management training for certain people who are at risk for complications from diabetes
          • You pay 20% after the Part B deductible
  • 16. What Part B Covers - Preventive
      • Screening Mammogram
        • Every 12 months for all women with Medicare age 40 and older and one baseline between ages 35 and 39
          • You pay 20% of the Medicare approved amount with no deductible
      • Prostate Cancer Screening
        • Digital Rectal and PSA Test every 12 months for all men age 50 and over on Medicare
          • You pay 20% after the Part B deductible, except for the PSA test which is paid by Medicare at 100% with no deductible
      • Shots
        • Flu shot each fall or winter
          • Medicare pays 100% with no deductible
        • Pneumococcal Shot – one per beneficiary
          • Medicare pays 100% with no deductible
        • Hepatitis B shots for people at medium to high risk for Hepatitis B
          • You pay 20% after the Part B deductible
  • 17. What Part B Covers - Preventive
      • New Welcome to Medicare Physical Exam
        • One time only within the first six months you have Part B. Includes height, weight, blood pressure, an EKG, education, and counseling
          • You pay 20% of the Medicare approved charge after the Part B deductible
  • 18. What isn’t covered by Medicare Part A and B
    • Acupuncture
    • Your deductible and coinsurance
    • Dental care/dentures
    • Cosmetic surgery
    • Custodial care
    • Health care while traveling outside the US
    • Hearing Aids/Exams
    • Orthopedic shoes
    • Outpatient prescription drugs
    • Routine foot care
    • Routine eye care and eyeglasses
    • Routine exams
    • Screening tests and labs except as previously listed
    • Vaccinations except as previously listed
    • Syringes and insulin unless used with an insulin pump
  • 19. Other Part B Services
    • Unless otherwise indicated, you pay 20% of the Medicare approved amount for these Part B services after the Part B deductible
      • Ambulance services when medically necessary to nearest hospital or skilled nursing facility that provides the services you need when transportation in another vehicle would endanger your health.
      • Chiropractic Services
      • Clinical Trials (routine costs, not the experimental drug or device)
      • Diabetic supplies
        • Glucose testing monitors, blood glucose test strips, lancet devices and lancets, glucose control solutions, and therapeutic shoes. Syringes and insulin aren’t covered under Part B.
  • 20. Other Part B Services
      • Durable Medical Equipment
      • Emergency Room Services
      • One pair of eyeglasses with standard frames that include an intraocular lens after cataract surgery.
      • Foot exams if you have diabetes related nerve damage
      • Kidney dialysis, services and supplies
      • Medical nutrition therapy services for people who have diabetes or kidney disease
  • 21. Other Part B Services
      • Mental Health Care (outpatient) and partial hospitalization services for people who need intensive coordinated outpatient care to avoid inpatient treatment.
        • You pay 50% after the Part B deductible
      • Services provided by clinical social workers, physician assistants, and nurse practitioners
      • Second surgical options
      • Surgical Dressings
      • Telemedicine services in some rural areas.
      • Tests like X-rays, MRIs, CT scans, EKGs, if medically necessary
      • Prosthetic/Orthotic Items
        • Arm, leg, and neck braces, artificial eyes, artificial limbs, breast prostheses after mastectomy, prosthetic devices need to replace an internal body part or function (including ostomy supplies)
  • 22. Other Part B services
    • Transplant Services
      • Heart, lung, kidney, pancreas, intestine, and liver transplants under certain conditions and in Medicare-certified facilities only, and bone marrow and cornea transplants (under certain conditions.) Oral immunosuppressive drugs if the transplant was paid for by Medicare, or paid by an employer group health plan that was required to pay before Medicare. You must have been entitled to Part A at the time of the transplant and entitled to Part B at the time you get immunosuppressive drugs, and the transplant must have been performed in a Medicare-certified facility.
        • Some of these services will be covered under Part A and some under Part B
  • 23. Using Doctors Who Don’t Accept Medicare
    • Most doctors accept Medicare assignment
    • This means they agree to Medicare’s rate
    • Some doctors accept Medicare but don’t accept Medicare assignment
    • They must still bill Medicare but are allowed to charge up to 15% above Medicare’s allowable rate
    • You are responsible for the difference between what Medicare pays these doctors and their total allowable charge.
  • 24. Does your doctor accept Medicare?
    • Some doctors don’t accept Medicare payments.
    • If you want care from one of these doctors, you may be asked to sign a private contract to guarantee payment for their services.
    • You can’t be asked to sign a private contract in an emergency situation.
    • If you do sign a private contract you will have to pay whatever this doctor or provider charges for the services. Medicare will not pay any of the charges.
    • If you have a Medigap policy, that policy will also not pay anything for the services
  • 25. New Benefits
  • 26. Prescription Drug Discount Card
    • A prescription drug discount card to provide temporary assistance with the cost of drugs has been available since 2004 and will last through 2005.
    • Beneficiaries can compare prescription drug discount cards available in their areas by going to www.Medicare.gov and clicking on “Prescription Drug and Other Assistance Programs.”
    • 1-800-Medicare also can provide this information.
  • 27. What discounts are available?
    • The companies offering the prescription drug discount cards have negotiated discounts to allow enrollees to pay a lower retail price.
    • Savings are estimated to be 10-25%
    • Only drugs included on the company’s discount list will be discounted, but most drugs are included.
    • Different drugs may be discounted at different rates, depending on what was negotiated, and the discounted prices may change over the course of the year.
  • 28. Who can get a discount card with the Medicare-approved seal?
    • Anyone on Medicare who doesn’t have drug benefits through Medicaid can participate in the Medicare approved discount card.
    • If a person lives part-time in more than one state, they should select a card that is offered in all of the states where they live.
    • Companies may charge an enrollment fee each year of no more than $30.
  • 29. Where will beneficiaries get their prescriptions?
    • Many pharmacies are participating in the program, and a beneficiary is likely to be able to use their existing pharmacy.
    • To get the discount, a person must use the pharmacies participating in the drug card program they select
    • Companies may also have a mail-order benefit that allows enrollees to get some of their medications by mail.
    • This may be convenient for many people who regularly take some medications and it may result in a better price for the drug.
  • 30. Is other financial assistance available to help with the cost of prescription drugs?
    • A Medicare beneficiary may still be able to get up to $300 for 2005 to help pay for their prescriptions
    • They must have Medicare and have income of less than $12,569 for single people or $16,862 if they are married
    • Assets are not counted for purposes of the $600 benefit
    • The assistance is not available if they have prescription drug coverage from any of the following
      • Medicaid
      • TRICARE
      • FEHBP
      • An employer group health plan or a retiree plan
    • They are still eligible for the assistance if they have a Medigap policy or a Medicare Managed Care plan.
  • 31. How does a person use the assistance?
    • The amount they are eligible for will be applied to the person’s drug discount card
    • Each time the card is used, the pharmacy will deduct the amount spent from the total they are eligible for
    • A statement will be included with the prescription letting the person know how their balance is, and they can also call the company’s toll-free number to find out the balance on their card.
    • When the assistance runs out, the card can still be used to get discounts on prescriptions
  • 32. New Prescription Drug Benefit
    • Medicare will begin a new prescription drug benefit in 2006 called Part D.
    • Coverage is voluntary – no senior will be forced to buy coverage they don’t want or need.
    • The cost for this benefit will be an average of $35 per month. This is in addition to your part B premium.
    • After a $250 deductible, Medicare will pay 75% of the next $2,000 of your prescription drug expenses.
    • After $2,250 in expenses, your prescription drug benefit card can be used to obtain discounted prices.
    • If your own share of prescription drug expenses is as high as $3,600 in a year, Medicare catastrophic coverage will begin.
    • You will then pay no more than 5% of the discounted cost of your covered drugs for the rest of the calendar year.
    • If you qualify for low income assistance, you may pay nothing out of your own pocket for catastrophic coverage.
    •  
  • 33. New Prescription Drug Benefit
    • Seniors now paying the full retail cost for prescription drugs will on average be able to cut their drug costs roughly in half.
    • Plan sponsors will use proven drug management techniques like formularies and step therapy used by most health plans today to keep costs affordable
    • Formularies must include drugs in each therapeutic category and class. It cannot limit a category or class to just one drug.
    • Pharmacists will be required to tell a beneficiary when a more affordable generic drug is available to treat their condition.
    • The law also calls for a medication therapy management program for beneficiaries with multiple chronic conditions to improve their outcomes.
  • 34. Low Income Beneficiaries
    • Those who are eligible for both Medicare and Medicaid will now receive their drug coverage through the Medicare Prescription Drug Plan rather than Medicaid.
    • Medicare Beneficiaries with limited savings and incomes below 135% of FPL will pay no monthly premium for their drug coverage, no deductible, and only $2 for generic and preferred drugs and $5 for other drugs, with no coverage limit.
    • Beneficiaries who are eligible for both Medicare and Medicaid and those with incomes below the federal poverty level will have copays of only $1 for generic and preferred drugs and $3 for other drugs, with no coverage limit.
    • Nursing home residents who are eligible for both Medicare and Medicaid will have no co-pay.
    • Other seniors with limited savings and incomes below 150% of FPL will pay reduced monthly premiums on a sliding scale, a $50 deductible, and 15% cost-sharing with no coverage limit.