If you live in Massachusetts, Minnesota, or Wisconsin, Medigap policies are standardized in a different way.
* Plan F also offers a high-deductible plan. If you choose this option, this means you must pay for Medicare-covered costs up to the deductible amount of $2,200 in 2017 before your Medigap plan pays anything.
** After you meet your out-of-pocket yearly limit and your yearly Part B deductible, the Medigap plan pays 100% of covered services for the rest of the calendar year.
*** Plan N pays 100% of the Part B coinsurance, except for a copayment of up to $20 for some office visits and up to a $50 copayment for emergency room visits that don’t result in inpatient admission.
For the first six months after a beneficiary starts receiving Medicare Part B, he or she cannot be turned down based on medical conditions, so clearly this is the best time to sign up for a Medigap plan. After that six-month window, insurers can underwrite the policies and can decline coverage based on pre-existing conditions.
Medicare Part D
What you may have noticed is that neither original Medicare (Parts A and B) nor any of the standardized Medigap policies cover prescription drugs. That’s because, until fairly recently, the Medicare program did not pay for medications outside of the hospital. Think about that for a second—the population that has the highest number of chronic conditions and therefore the greatest need for medication did not have coverage for prescription drugs under their health program until 2006. Before that time, some seniors living on a fixed income often had to make the difficult choices in spending if they needed medications. Clearly, they needed some help. That’s why, in December of 2003, President Bush signed the Medicare Modernization Act and created the Medicare Part D drug program.
Under Medicare Part D, people get help paying for the medications they need. In most parts of the country, there are a number of plans to choose from, each with different drug formularies, required copayments, and monthly plan premiums. Many require the member to pay an annual deductible before the drug coverage kicks in, and almost all have a “coverage gap,” sometimes referred to as a donut hole, after the total drug costs exceed a certain amount. The coverage gap has gotten smaller as a result of the Affordable Care Act, but it’s still something that many seniors fear.
The interesting thing about the Medicare Part D program is that the government doesn’t actually offer any of the available drug plans; instead, they’re offered by private insurance companies. This unique approach has led to more options for consumers, and the competition has helped to keep premiums down.
Medicare Part D can be offered as a stand-alone plan to pair with original Medicare (and a supplement) or can be incorporated into a Medicare Advantage plan, discussed below.
Medicare Advantage Plans
Medicare supplements are great. They fill many of the holes in an individual’s Medicare coverage, giving them financial peace of mind, and they allow beneficiaries to visit any provider that accepts Medicare. Unfortunately, though, not everyone can afford a Medicare supplement. That’s where a Medicare Advantage (MA) plan can help.
Medicare Advantage plans are offered by private insurance companies that take over for Medicare. While a supplement simply fills the holes in Medicare, an Advantage plan actually replaces Medicare. While a beneficiary is on an Advantage plan, he won’t use his Medicare card; instead, he’ll show his MA insurance card when he visits the doctor or goes to the hospital. If his Advantage plan has Medicare Part D built into it (a Medicare Advantage Prescription Drug Plan, or MAPD for short), he’ll show the same card when he picks up his monthly prescriptions.
Medicare Advantage plans look a lot more like the insurance sold in the individual and group markets. There are several different types of plans, including HMOs and PPOs, and most have copayments for lower-cost services, deductibles and coinsurance for higher-cost services, and an out-of-pocket maximum that limits the member’s financial exposure. Most also have contracted provider networks and offer the best benefits when members visit in-network providers.
One type of Medicare Advantage plan, called Private Fee for Service (PFFS), does not contract with providers but instead pays a pre-determined amount for covered services. Providers do not have to treat patients with this type of coverage, so it’s important for members to talk with their providers ahead of time to make sure they’re willing to treat them and accept the plan’s payment terms.
There’s no underwriting on a Medicare Advantage plan. As long as the Medicare beneficiary has both parts A and B, lives in the plan’s service area, and does not have End Stage Renal Disease, he or she qualifies for an Advantage plan. These plans also have a much lower monthly premiums than a Medicare supplement, sometimes with no additional cost beyond the Medicare Part B premium. The downside is that the out- of-pocket exposure is usually a little higher than with a supplement, and Medicare Advantage plans come with network restrictions that supplements do not.
Annual Election Period
That brings us to the Annual Election Period, or AEP, which runs from October 15 to December 7. This is the time of the year when people can join, switch, or cancel their Medicare Advantage and Medicare Part D plans. Agents who sell these products spend weeks preparing for the craziness, completing the various training and certification programs required by their states and the carriers they represent.
To get more information on Medicare and get prices on Medicare supplements and Part D Prescription coverage please call Elaine Saccente at: 704-891-2274 firstname.lastname@example.org.