Senior Health Insurance

(Medicare Part A and Medicare Part B should not be confused with Medicare Supplement Plan A and Medicare Supplement Plan B. These Medigap or Medicare Supplement insurance plans supplement Original Medicare. Information regarding these plans will be covered in a soon-to-come blog post.)

Medicare Parts A and Medicare Part B are also known as “Original Medicare.” These programs were conceived during the political debate of the 1940s. President Truman was a proponent of universal healthcare.

When these medical plans actually came to life during in 1965 during President Johnson’s administration, President Truman was the first to enroll in Medicare. (The monthly premium for Medicare Part B was $3 a month at that time.  The Part B premium for 2011 ranges between $115.40 and $369.10 depending on your income).

Initially Medicare beneficiaries were all over age 65. In 1972 the program was expanded to include people with certain disabilities.

Medicare Part A is sometimes referred to as Medicare Hospitalization Insurance. Part A benefits can pay a portion of the expenses of medical services you might receive for inpatient hospital care, inpatient care in a skilled nursing facility, home health care and hospice care.

If you are covered by Medicare Part A and are admitted to the hospital, you will be responsible for a deductible. In 2011 the deductible is $1,132. If you are still in the hospital after 60 days, you will be responsible for a copayment of $283 dollars per day (or 25% of the current hospital deductible). If you are still in the hospital after 90 days that copayment will increase to $566 (or 50% of the hospital deductible). Medicare Part A benefits can cover the expenses that are in excess of your deductible and copayments up to this point. If you are still in the hospital after 150 days, your hospital benefits will stop and you will be responsible for all costs.

If you return to the hospital after 60 days consecutive days of not needing hospital benefits, you may start a new benefit period. This means that you can be responsible for another deductible.

If you move from a hospital to a skilled nursing home Medicare Part A may the cost of some of the services you receive there as well. You will have a copayment of $141.50 (or 12.5% of the hospital deductible) for days 21 through 100. After the 100th day you will be responsible for all costs.

(It is important to note that most nursing care is custodial and not skilled. You cannot file Medicare Part A claims for custodial care or intermediate care.)

Medicare Part A medical benefits can also cover some home health care. However this coverage is

Limited to medically-necessary part-time or intermittent skilled nursing care, or physical therapy, speech-language pathology, or a continuing need for occupational therapy.

Medicare & You booklet for 2011

The coverage for nursing home care and home health care is limited. Medicare is not designed to pay for ongoing care. It is primarily designed to get you back on your feet after a medical event.

People who need home health care services or nursing home care for long periods of time will have to find other ways to pay for those services. The money for these services can come from other government programs, the person’s assets or a long-term care insurance policy.

Hospice care may be covered as well. To be eligible for this care a doctor must certify that you are expected to live for six months or less.

Most American citizens are eligible for enrollment in Medicare Part A on the first day of the month that they turn 65. People with certain disabilities who are younger may also qualify for enrollment.

Few Medicare beneficiaries are charged a monthly premium for Medicare Part A. An American citizen who has worked and paid taxes 10 years is likely to qualify for Medicare Part A without any premiums.

Those who qualify for Medicare Part A, but haven’t worked enough quarters can pay for the coverage. The base premium for 2011 is $450. There may be penalties for those who don’t enroll as soon as they were eligible.

Medicare Part A only provides partial coverage. You cannot file Medicare Part A claims for doctor’s visits or medicines.

More comprehensive benefits are provided when one has Medicare Part A, Medicare Part B, a Medigap insurance policy and a prescription drug policy.

Similarly comprehensive medical coverage can be provided by a Medicare Part C policy without the other policies. (Some Part C policies will not include prescription drug coverage.) These insurance policies are also known as Medicare Advantage plans. Information about these other policies and their benefits in soon-to-come blog posts.

If you are 65 or over or are a younger Medicare beneficiary, you have probably heard about the new Medicare Advantage plans. You may wonder whether you should get your health care paid for with the help of a Medigap or one of these newer policies. The information you need to make a decision is below.

Original Medicare (Medicare Part A and Part B) requires a Medigap supplemental health insurance policy to approach full coverage. Even with a supplement prescriptions will not be covered.

A Medicare Advantage plan can combine the benefits offered by all three of the above. It can provide the benefits of Original Medicare, a Medigap policy and it can cover prescription drugs. (Not all policies cover prescription medications. You may need to supplement your policy with a prescription drug policy.)

A Medicare Advantage policy can also have a lower premium. It can be a cheaper way to cover your costs for doctors than a combination of Medicare and a Medigap policy. Since this is the case, you would think that in the battle of Medigap vs. Medicare Advantage the Medicare Advantage policy will always win.

This isn’t necessarily the case. Although the Medicare Advantage policies are better for most Medicare beneficiaries, they aren’t the best insurance plans for all.

Original Medicare (Medicare Part A and Medicare Part B) and Medigap have one big advantage over the MA policies. They can be used all over the United States for both routine care and emergency care.

If you have an MA policy you will be able to get emergency care outside of your policy’s servicing area, but you will need to go to local doctors for your routine care. This means that if you have to go to an ER while on vacation, your MA health insurance policy is likely to cover the costs. However, if you need routine care when away from home, you may need to pay for it out of your pocket.

Switching to a Medicare Advantage policy may mean that you have to switch doctors. You may need to go to a different drug store or hospital also. Your health insurance company will have a network of providers that they want you to use. Except where the information in the contract says otherwise, you will need to go to those providers for your routine care if you want them to pay for the care you receive.

Which is better Medicare and Medigap Supplemental medical policy or a Medicare Advantage policy? Your health and the amount of time you spend living or traveling away from home will be the factors that determine which types of plans are best for you.

Senior citizens have more options than ever before for health insurance today. The Medicare program has expanded. There is now Medicare Part C as well as Medicare Part D. The Medicare Supplement plans can provide great benefits and are still viable options.

Just a few years ago, the most recommended senior health insurance policy or plan combination was a combination of Original Medicare and a Medicare Supplement policy. Although that combination is a good one for many seniors in the year 2011, it is no longer the best option for most seniors.

Medicare Part C is often a superior choice. These policies can be as comprehensive as a combination of Medicare Part A, Medicare Part B and a Medigap (Medicare Supplement) policy. And the costs can be much lower.

The primary drawback with Medicare Part C is that these policies often limit the doctors you can go to for routine or non-emergency care. Since the coverage for medical emergencies is much less restricted when compared with the coverage for routine health care, a person who travels can be well served by a Medicare Part C policy.

If, however, you need non-emergency care when you travel you may find that these policies are not for you. If you need have a second home that it outside of your policy’s servicing area, you may have a problem getting benefits covered when you are in that home.

A Medicare Part D plan offers substantial coverage for prescription drugs. These are good policies, but most Medicare Part C policies will include similar drug coverage.

If you will need non-emergency medical care when you are out of town and find yourself too far away from their local doctors or other providers, Original Medicare and a Medicare Supplement will probably be best for you. Otherwise, you may be pleasantly surprised by the coverage you will find in a Medicare Part C policy. You will probably like both the coverage and the cost.

This year best value for senior health insurance may no longer be a Medigap policy. Medicare Part C and Part D are the new kids on the block. They may offer better value for many Americans.

Medicare part C pays for most of what a combination of Original Medicare (Medicare Part A and Part B) and a Medicare Supplement would pay for. It can pay for more. It will almost certainly have a lower rate. In some cases the policy will not have rates; it will be free.

Medicare part C is a very different program when compared to Original Medicare. It is overseen by the federal government, but the benefits come from private health insurance companies.

The policies are fairly standardized. They are not quite as easy to understand as the Supplement policies are, but nearly so. The fact that the plans are similar and that similar language is used to describe them means that the quote and information you learn from one company will be useful when researching another. This can make the process of getting quotes and comparing those quotes for different plans and companies much easier.

Medicare Part D pays for prescription drugs. In some cases prescription drug benefits will be included in a Part C policy. This will make having a Part D plan just an extra cost.

Medicare Part C year may provide you with the best value and can make securing yourself financially much easier and less costly.

Medicare Part A and Part B are also known as Original Medicare. Medicare Part A provides coverage primarily for hospital expenses. Medicare Part B primarily provides coverage for doctors visits.

Most seniors who haven’t chosen a Medicare Advantage or a Part C policy will have these two parts of Medicare

Medicare Parts A and B should not be confused with Medicare Supplement Plans A and B. (Why they didn’t give numbers for one and letters for the other I’ll never know.)

Medicare Part A and B provide substantial medical insurance, but many seniors and other Medicare beneficiaries choose to supplement this coverage with a Medicare Supplement policy or choose to purchase a Medicare Part C policy. This is because coverage offered by these parts A and B of Medicare leave the Medicare beneficiary with deductibles and coinsurance to pay.

(A Medicare Part C policy pays benefits similar to a combination of Medicare Part A, Medicare Part B and a Medicare Supplement. One type of Medicare Part C policy is a Medicare Advantage policy.)

If you have worked and paid into Medicare for 40 or more quarters you will probably not have to pay for the cost of Medicare Part A. Medicare Part A can cost as much as $450 if you haven’t paid into Medicare for enough quarters.

Medicare part B can cost up to 369.10 in 2011 or as low as 96.40. The costs are based on when you became eligible for Part B and your income in 2009.

————————–

Where do insurance agent hang  out?  You can find a bunch of us in this Insurance Forum.

The new kid on the Medicare block is Part D or Prescription Drug Coverage. Adding this prescription drug insurance option to Medicare can make a world of difference to many seniors as well as to other Medicare recipients.

Medicare Part D is provided by insurance companies not the federal government. This is also true for Medicare Part C.

Prescription drug coverage or Part D can be purchased separately from your other coverage or as part of another policy. Drug coverage can be incorporated into a Medicare Advantage policy. If you have Original Medicare and a Medicare Supplement, you may choose to buy a separate prescription drug policy to add to your coverage, you may choose to get a Medicare Advantage policy that includes equivalent prescription drug coverage.

The exact benefits of a prescription drug policy will vary from company to company, but the variations are limited. Each policy has to be as good as or better than the standard model.

The standard benefits for 2011 include a prescription drug deductible of $310. If you meet that deductible, any prescription drugs cost in excess of the $310 deductible will be covered at 75% until your total costs for drugs reaches $2,840. This total cost includes the deductible. Any generic drug costs in excess of this amount will be paid by the insured at a 93% rate until the total costs reach approximately $7,000. Name brand drugs are discounted by the manufacturer so that the cost to the insured is approximate half of the standard costs for those drugs until your total costs exceed $7,000. After your drug costs reach approximately $7,000, your insurer will pay 95% of the cost of your drugs.

This coverage, although complex is very important and will extend the lives of many Medicare beneficiaries who otherwise would not be able to afford their prescriptions. It is available without any health screening so your current need for prescription drugs will not keep you from qualifying.

Medicare Prescription Drug Coverage is also known as Medicare Part D. The program began in 2006 helps reduce Medicare recipients costs who have need costly prescription drugs.

This coverage is offered only through private health insurance carriers. Unlike Medicare Parts A and Medicare Part B, You cannot get this coverage from the federal government although there is a lot of government oversight of the companies that offer Medicare Part D.

The carriers may offer different deductibles or cost shares, but they have to meet certain minimums. There is a standard benefit that the policies have to equal or exceed.

Although the Part D policies can offer lower benefits when compared to specific aspects of the standard benefit policy, they have to make it up in other aspects. Any Part D prescription drug policy has to be the actuarial equivalent or better than the standard benefit policy.

The standard benefit for 2011 requires that the insured pays the first $310 of his or her prescription expenses. Then the plan will pay 75% of any additional expenses until the total expenses reach $2,840 including the deductible.

When expenses exceed $2,840 you enter what is known as the “coverage gap.” The coverage gap ends when expenses reach around 6,719. During the coverage gap the insurer pays 7% of the cost of generic drugs. The drug manufacturers pay 50% of the cost of generic drugs.

The “coverage gap” ends when the insured reaches $6,719.03 as a maximum. It can end earlier. It can end when the total Rx costs reach as little as $6,447.50. The percentage of name brand drugs verses generic drugs determines the dollar figure at which the coverage gap ends.

When the “coverage gap” ends the plan will pay 95% of the cost of medicines.

These policies can save many seniors and younger Medicare recipients thousands of dollars. Until 2006 when the prescription drug program began, prescriptions were not covered by Medicare and poorly covered by Medigap policies. These policies can be a real life saver for many seniors.

Deciding whether buying a Medicare Advantage policy is better for you than Original Medicare is a decision that you should make before you decide which Medicare Advantage is better for you. Many people are better off with Original Medicare after they compare the two types of plans.

Medicare Advantage policies often to a better job of meeting a consumer’s needs than a combination of Medicare parts A Medicare part B, a MediGap policy and a Prescription Drug Plan. This is true for several reasons, not the least of which is simplicity.

Medicare Advantage Plans are usually cheaper when compared to getting separate policies that cover the same medical services. This is, of course, a vote in the favor of the Medicare Advantage plans. However, there are other factors to consider.

Since the price is almost better if one chooses a Medicare Advantage policy, the choice between the two often is based on the network. A Medicare Advantage policy with very few exceptions, limits the doctors and hospitals that a policyholder can use to those in their network. (One exception is that emergency care is covered throughout the country.) Original Medicare and the supplemental policies can be used all over the country.

If you have a second home outside the servicing area of the Medicare Advantage policy or spend a lot of time traveling or visiting outside the area, Original Medicare and a Supplement will probably be better for you. However, if you are very healthy and are unlikely to need anything beside emergency care outside of the network, you may still a good candidate for a Part C Medicare Advantage policy.

If you have decided that you want a Medicare Advantage policy, you will need to compare plans and choose which policy to purchase. There are several factors that should probably enter into your decision making process.

One of these factors is the prescription coverage. You should be aware of the deductible and co-pays.

You should also be aware of the costs shares associated with all the medical benefits. Cost shares are deductibles, coinsurance payments and copayments.

As mentioned before, the network is an important factor. With very limited exceptions you will only be able to get emergency care when you are outside the network. So it is very important to be comfortable with the doctors and hospitals that accept payment from the plan.

Before comparing Medicare Advantage policies one should first compare Medicare Advantage policies with Original Medicare and a supplement. If one then decides to get a Medicare Advantage policy the next step is to look at the benefits, cost shares and the network before making a final decision.

Prescription coverage was one of the big gaps in Original Medicare. It was one that Medicare Supplement (Medigap) policies never filled very well.

Today we have the Medicare Part D policies that do a good job of providing coverage for Rx. The protection you will get from a Prescription Drug Plan or PDP is very good. And it is offered at a price that most seniors can afford.

Good News about Medicare Prescription Drug Plans

These policies will be dramatically better in 2011 when compared to 2010. In 2010 Policyholders who have larger prescription bills will get lower rates for name brand drugs.

Qualifications for Prescription Drug Coverage

You should qualify for a Prescription Drug Plan if you have either Medicare Part A or Medicare Part B. Medicare beneficiaries qualify for these policies whether or not they are over age 65.

You can get coverage from a PDP one of two ways. You can purchase a standalone policy. You can get prescription drug coverage a Medicare Health Plan that also includes coverage for Rx.

If you have Original Medicare and a supplement that does not cover prescriptions, you can purchase a standalone PDP. If you have one of the older Supplemental policies that cover prescriptions, you will have to either change policies or have your insurance carrier remove the Rx benefits from your Supplement plan.

Medicare Supplement policies that are sold today are not allowed to cover prescriptions. Policies sold in the past were able to do so. Those who purchased those types of policies in the past are allowed to keep them.

You can have the benefits you might expect from a PDP included in your Medicare Advantage policy. This is often a very cost-effective way to get prescription coverage.

If you purchase such a policy you will not be able to get a separate Prescription Drug Plan. You are only allowed to have one policy that covers prescriptions.

If your Medicare Advantage policy doesn’t cover prescriptions, you can purchase a separate PDP or you can change Medicare Advantage policies.

PDPs fill a great need. They help Medicare beneficiaries get protection against high bills for medicine.