Many kinds of medical treatment and services are provided today on an outpatient basis!
● However, if you only use MediCare's Part A & B (called original Medicare) when going for treatment your MDs or other outpatient providers are not paid 100% for their services!
Why? Lets look at how MediCare's system works — it:
● Reviews all medical treatments and services and "assigns" ** an amount to pay for each.
● Asks MDs and others, as part of agreeing to participate, to accept just 80% of the approved amount, which is called accept "assignment".
** Discounted, often deeply, from retail!
● Going for Outpatient treatment and services — you would be responsible for 20% of the approved amount for each.
Note: When see outpatient providers you also pay Part B's annual deductible at he beginning of each year. It's $203 during 2021.
● Being admitted to a hospital — MediCare pays the approved amount for all medically necessary treatment & services — you just pay the Part A deductible each time you are admitted. It's $1,484 in 2021.
Bottom line — paying 20% for all the many outpatient treatments you may receive could quickly be a Big Risk to income & savings!
● You protect your income & savings from the part of treatment expenses MediCare does not pay!
● The Supplement plan company and the plan you select:
- > Works with MediCare's system to pay your providers most or part of the outpatient treatment or service invoices MediCare did not pay.
Note: The amount the company pays and you pay, of the part MediCare did not pay, varies based on coverage in your Supplement. For example, Plan N has $20 office co-pays.
- > Pays Part A's deductible each time admitted to a hospital ($1,484 in 2021).
Note: MediCare pays the hospital — the approved amount — for all the authorized treatment and services you receive.
● Being able to see any provider here in CT or in another state who accepts MediCare, when you need to! The is important!
● No longer have to pay, following unexpected medical situations, a lot of treatment bills coming in the mail — thus it protects your income & savings!
The company pays providers, all or part of the treatment MediCare did not. The so called Gap.
[Supplements are often called MediGap Plans.]
Note: 9 out of 10 people who have a Medicare Supplement say they are happy!
● The MD or other provider's office will want to see and usually scan your Supplement plan ID card and your Medicare ID card.
● The provider submits their charge for your treatment & visit to a MediCare claims administrator.
● Your Supplement company:
-> receives from the MediCare claim administrator the expenses being charged to you.
-> reviews the treatment and then pays your provider, based on coverage in your page, the part of your treatment expense MediCare did not.
Note: The details in your plan application gave the company approval to access your expenses.
● The MediCare system sends you a quarterly coverage summary when you have treatment.
Note: The summary has a - Maximum You May Be Billed - column with a code by the amount indicating it was sent to the Supplement company.
● The Supplement company also sends an explanation of their payments.
Note: Medical treatment providers send lots of invoices quite quickly following your visit. Do not pay any of these provider invoices when they come. Wait to see the actual amount you are responsible for, if any, on your supplement statement.
No! Supplements just pay the unpaid part of treatment and services MediCare has approved as medically necessary. The company then pays the provider, based on your plans coverage.
A point about owning a Supplement:
● When you make an appointment just tell the provider you have MediCare. Providers do not have to know what Supplement company you have. Nor, since they accept MediCare, can they say they do take plans from your Supplement company.
● Federal regulations authorized the National Association of Insurance Commissioners (NAIC) to develop the coverage each Supplement plan will offer.
● When plans were initially developed they were given "lettered' names". A has the least coverage, B, C. etc. have more.
[Confusing since the parts of MediCare also have letter names. ]
● Over time the NAIC has made coverage updates.
● Federal regulations instruct each state legislative body to approve the plan coverage the NAIC recommends. States incorporate them in their regulations and add their specific eligibility requirements.
● This means coverage in a specific letter Supplements in CT will be the same as that lettered plan in most states.
● Effective 2020 a federal regulation restricted availability of full coverage plansr:
-> The new requirement says anyone turning 65 in January 2020 or after, called newly eligible, can not buy a plan, which pays Part B's deductible, such as Plan F.
Note: Individuals who were 65, prior to Jan. 2020, are not restricted.
Here in Connecticut state legislation and regulations authorized the CT Insurance Dept. (CID) to ensure all Supplement companies:
● Who offer any lettered Supplement in CT follow these state and CID requirements:
-> a person enrolling, whether male or female or 65 or 95, will be charged the same monthly cost.
-> any offered plan is available to individuals living in any CT County.
-> questions about a person's health history can not be asked.
-> when a monthly increase is proposed the company submits it to the CID. When approved, increases are often effective January 1st.
Note: CID often refers to Supplements as MediGap plans.
● Permit individuals who sign up for a Medicare Supplement to:
-> receive their new coverage the 1st of the next month after applying.
-> be able to change (normally) to another plan with their company at any time or to another company.
Note - Coverage in any specific lettered plan in CT from any company is the same - but:
-> the monthly cost a company charges can vary considerably from what the same plan costs from another company!
● First — Plan N - One companies N is over $100 a month less than their full coverage Plan F.
Why is N less? You share in the 20% MediCare did not pay for treatment by paying:
-> Part B's annual deductible [$203 for 2021];
-> a $20 co-pay for each MD office visit;
-> a $50 co-pay if any emergency room visits.
● Second — High Deductible (HD) Plans such as HD Plan F & HD Plan G. Though not available from all the companies in CT they are the lowest cost Supplements.
-> How is the monthly cost lowest? Coverage is the same as Plan F or G but you pay, at the beginning of each calendar year, the first $2,370 (for 2021) of any medical treatment or services received.
-> Any medical related expenses above the deductible not paid by Medicare are paid by he company.
-> High deductible plans are a good option for someone who was using a high deductible plan when under 65.
● Note: High F is not available to newly eligible individuals [65 in Jan 2020 or later] However, they can buy the new High G with the same deductible.
What to do? Buy what MediCare calls a Prescription Drug Plan. (PDP) to pay part of your outpatient prescription costs.
PDPs are Medicare's Part D. When at a local Pharmacy:
● You pay a co-pay or cost sharing based on the Tier level of your medication. Some plans have an annual deductible to pay first. Often it is only on certain Tiers.
The regulations establishing the PDP set it up as voluntary program but if you do not have "credible" prescription coverage, such as from an employer a late enrollment penalty is added when you do sign up.
PDPs are developed by and purchased from a private company. Availability is based on the County you live in.
Note: There are 27 PDP options in New London County as of Jan 2021 !.
When can you purchase a PDP?
● When turning 65 there is what is called the Initial Eligibility Period to apply for a PDP plan. It is a 7 month time at the same time you can sign up for MediCare.
● Once enrolled a person can only change to another PDP plan during the Oct 15 to Dec 7 Annual Election Period (AEP) unless they qualify for a Special Enrollment Period, such as after moving.
When we talk the focus will be to
● Understand your situation and interest!
● Review Supplement plan options, answer questions, and select the best plan for your interest & budget.
We can also talk about Medicare PDP options and select, when enrollment is available, a plan to fit your medical situation.