Medicare Open Enrollment is Coming to Northwest Arkansas
Yesterday (Sept. 15, 2016) marked the beginning of National Medicare Education Week in preparation for open enrollment Oct 7-December 15, 2016.
According to a recent poll reported by Fox Business News, 80% of Americans who qualify for Medicare feel that they are woefully lacking when it comes to knowing the ins and outs of the Medicare program. So in the spirit of NMEW, here are some basics that will help you navigate the Medicare maze.
The Origins of Original Medicare
The Medicare program was established in 1965 to help seniors handle rising health costs. Originally, the program consisted of just two parts, Part A and Part B.
Part A pays some of the costs associated with a hospital stay, as well as for Medicare approved services and medications given the patient while they are hospitalized. Part B covers doctor visits, as well some preventive services such as emergency room visits.
Those who only have Parts A and B are responsible for 20% of all costs incurred for their care.
Medicare Supplement Plans
Medicare Supplement (or Medigap) plans are plans that cover costs that original medicare won’t cover; some plans also help cover deductibles, co-pays and premiums. There is no network, so a member can go to any facility across the country that accepts Medicare. However, over time, premiums can be expected to rise steadily.
Medicare Parts C and D
Medicare Advantage plans(MA-PDs) are NOT the same as Medicare Supplement plans; they consist of Parts C and D of Medicare; these plans are Medicare approved plans that provide additional services, such as gym membership, basic hearing and dental services, and many preventive services such as colonoscopy, yearly breast exams, etc. To be eligible, a member must have BOTH Medicare Part A and B.
Hospital charges are incurred on a per diem basis; the per day amount covers the room itself, plus medications, services, etc. Typically, there is a maximum number of days that the patient will be charged (typically 5-6 days, depending on the plan). This doesn’t mean the patient will be booted out after 5 or 6 days; it means that the patient will not be charged for additional days after the maximum.
There is also an out-of-pocket maximum with these plans so members can more accurately predict what a “worst case scenario” might look like.
These plans also cover some prescription drug costs; each company develops a formulary made up of tiers 1-4. Typically, drugs in tiers 1 and 2 are lower cost and/or generic. Tiers 3 and 4 consist of pricier drugs. If your doctor prescribes a pricier drug that isn’t covered well under the plan you have, you can discuss the alternatives. Typically, physicians who accept Medicare are aware of what Advantage Plans will or will not cover.
Premiums for these plans as well as co-pays for doctor visits and formularies for prescriptions change from year to year and from company to company. Because of this, it is important to talk with an independent professional with the expertise and knowledge to help you decide if it’s more advantageous to remain on the same plan, or if it’s time to make a change.
Stand Alone Part D Plans
Additionally, there are prescription drug plans that do not have Part C included. To be eligible for Part D drugs, a member must have either Part A or Part B of Original Medicare to be eligible for these plans. As is the case with MA-PDs, the formularies and premiums for these plans vary from year to year