What You Need To Know For Medicare Open Enrollment
With Thanksgiving comes that time of year for Medicare enrollees to sharpen their pencils and get to work deciding their prescription (Medicare Part “D”)and Medicare Advantage plans for next year. The period known as “open enrollment” began November 15 and will run until December 31.
Medicare Supplement enrollees, also referred to as Med Supp, for short, or Medigap are not affected as to health coverage. They might still want to check prescription drug plans but, if they want to change, they should do so very cautiously since change could have unintended consequences. More of this is discussed below.
If this seems complicated, it is.
When the Medicare Prescription Drug Improvement and Modernization Act, the law that introduced the Medicare “D” prescription drug benefit, was adopted, it also fundamentally altered the way that health care plans that coordinate coverage with Medicare operate. Here is what you need to know.
First. Before making any decisions, Medicare beneficiaries need to understand the coverage they now have.
Basic Medicare includes Parts “A,” “B” and “D.” Part “A” is the hospital benefit. Part “B” covers doctor’s visits and some medical supplies and equipment. Part “D” is for prescription drugs and is handled through private health insurers. It is possible to have “A” without having “B” or “D” as, for instance, when the beneficiary continues to work after retirement age and is covered under an employer’s policy.
Most retirees have their Medicare “B” premium taken out of their monthly Social Security check and decide on their own if they want Medicare “D.”
If a Medicare beneficiary wants health coverage in addition to the basic Medicare benefit, he can sign for a Medicare Advantage plan (previously known as a Medicare HMO) or a Medicare Supplement also known as Medigap. The systems are very different. Keystone 65 and Aetna U.S. Healthcare Medicare Advantage plans would be examples of Medicare Advantage coverage. Independence Blue Cross Security 65 would be one example of a Medicare Supplement. Many health insurers offer both types of plans. PFFS (Private Fee For Service) plans are a subcategory of Medicare Advantage plans.
Before deciding any change in coverage, a Medicare beneficiary should read through the list above and decide what coverages he has now.
Second. Know the differences in cost, coverage, prescription drugs, and benefits. Prescription drug coverage is part of an overall picture. Once having determined the type of coverage the beneficiary now has, he can decide whether his coverage fits his needs. In very general terms, these are the differences between Medicare Advantage plans and Medigap.
· Cost. Medigap plans will generally cost more than Medicare Advantage. They do not have the deductibles and co-pays and do not require the referrals that are often necessary with Medicare Advantage.
· Coverage. Medigap plans are generally accepted by doctors and hospitals. When signing for Medicare Advantage, the prospective applicant should first explore whether her physicians, hospitals and health care providers accept the coverage.
· Prescription Drug Coverage. Medigap plans can no longer cover prescription drugs. This was a change effected by the Medicare Modernization Act. This means that, if a Medigap policyholder wants prescription drug coverage, she must buy it through a separate plan known as a PDP that usually can be purchased through the same insurance company that offers the Medigap plan. Medicare Advantage plans, on the other hand, typically come with prescription drug coverage.
· Benefits. Medigap plans have standardized benefits listed as options A through L . Benefits vary widely for Medicare Advantage plans and the policy should be reviewed for specifics.
Third. Avoid problems that could be caused by not recognizing the differences. Shortly after the Medicare Modernization Act went into effect I was contacted by a prospective client who discovered to her amazement that, when she changed prescription drug coverage, she lost her health insurance. This is how it happened.
In completing the forms to sign for a prescription drug plan, the applicant did not realize that the plan was part of a Medicare Advantage policy. The application for a new prescription drug plan moved her from a Medigap health insurance policy which she could have supplemented with a PDP Prescription Drug Plan to Medicare Advantage which was not her intended result.
Finally, in comparing drug plans, make a list of all the prescription medicines you take and run them through them the Center for Medicare and Medicaid Services www.cms.gov on the Internet to see whether they are covered by your prospective plan. Take time and patience.
About the Author Janet Colliton
Esquire, Colliton Law Associates, P.C. Janet Colliton has practiced law for over 38 years, 37 of them in Chester County, Pennsylvania, a suburb of Philadelphia. Her practice, Colliton Law Associates, PC, is limited to elder law, Medicaid, including advice, applications and appeals, and other benefits planning including Veterans benefits, life care and special needs planning, guardianships, retirement, and estate planning and administration.