Medicare 101

Agenda Understanding the basics of Medicare What is Medicare? Who qualifies? How do you obtain it? How does it work? What are the different coverage options? Medicare Advantage vs. Medicare Supplement Medicare Advantage HMO, PPO, HMO-POS, PFFS Medicare Supplements Plans A-N Formularies & Provider Directories What are they? Why do I need to check them? Prescription Drugs Part D Coverage Gap/Donut Hole Election Periods

Understanding the basics of Original Medicare What is Medicare? A national fee-for-service insurance program, administered by the U.S. federal government. Medicare is a sub-agency of Social Security. Part A (Hospital Insurance) Part B (Medical Insurance) Who Qualifies? Aged 65 or disabled U.S. Citizen and resident You must have paid into the system for 10 years (or 40 quarters of taxes). You OR your spouse. Even divorcees will get Medicare, as long as their spouse worked for 10 years and had SS taxes withheld. If disabled… Must be receiving SSDI benefits for 24 consecutive months to qualify. “Original Medicare”

How do you obtain Medicare? Some people get Part A & Part B automatically You may qualify automatically if one of the following applies to you: I’m already getting benefits from SS or the Railroad Retirement Board (RRB) I’m under 65 and have a disability I have Lou Gehrig’s disease *If you’re automatically enrolled, you will receive your Red, White, and Blue Medicare card in the mail 3 months before your 65th birthday or your 25th month of disability. - If you don’t get your card in the mail, call Social Security at 1-800-772-1213 Some people need to sign up for Part A & Part B You need to sign up for Part A and Part B if the following applies to you: You aren’t getting SS or RR benefits (for example, because you’re still working) You qualify for Medicare because you have ESRD

Parts A & B When can I first enroll? What if I’m late to enroll? The three months before your 65th birthday, the month of, and the three months after Enrollment in Part A is automatic if you are already receiving SS Benefits. What if I’m late to enroll? For Part A, usually no penalties (unless you didn’t pay enough into SS) For Part B, premiums will be higher after the Initial Enrollment Period (unless you qualify for an exception) You’ll pay a 10% penalty for each full 12-month period you wait to enroll.

What if you don’t want Part B? If your Medicare hasn’t started yet, there are 2 ways to drop Part B: 1. If you were automatically enrolled in Part A & Part B and sent a Medicare card, follow the instructions that come with the card, and send the card back. If you keep the card, you keep Part B and will pay Part B premiums. 2. If you signed up for Medicare through SS, contact Social Security.

Examples of Medicare Card #’s: - Medicare RR Card: A554-26-1234 (the letter is at the FRONT, not at the end) Make sure to write that # on the app exactly as it appears on their card - Spouse receiving benefits: 554-26-1234B - Spouse – Divorced: 554-26-1234D - Widowed – Child Dependent: 554-26-1234WCD

There are 2 Medicare Choices: 1 2 ORIGINAL MEDICARE (Part A & B) Part A Hospital Most people don’t pay a monthly premium for Part A If you have to buy Part A, you will pay $411/month Skilled Nursing – SNF (days 1-20, you pay $0; days 21-100, you pay $161 per day) After 100 days, you move into Long Term Care (LTC) Home Health/Hospice (You pay $0) Inpatient Care (You pay the deductible $1,288. Days 1-60: $0, Days 61-90: $322 coinsurance per day) Some blood transfusions Part B Doctor & Outpatient visits Premium change for 2016: $121.80 (remember, this amount can go up each year) Deductible: $166 per year (having a deductible makes people think twice about seeing a doctor.) Ambulance Medical equipment Certain Drugs (Chemo, Radiation) Covers 80% (as soon as you’ve paid your premium). You’ll pay 20% of the Medicare Approved Amount (after your deductible is met.) MEDICARE ADVANTAGE Plan (Part C) Combines Part A and Part B and, in many cases, includes prescription drug coverage MAPD – Comprehensive Plan Offered by Private Insurance companies Premium varies by plan. Some plans offer a $0 premium Your $121.80 Part B deductible now goes to the private ins co. You must continue to pay your Part B premium It changes how you receive your Medicare You won’t lose your Part A & B Advantages: Dental, Vision, Hearing, Wellness Services, Gym membership, Good plan for healthy people, low premium. Disadvantages: HMO plan may have a Gatekeeper process, the plan premiums, benefits and co-payments may change every year.

Medicare Advantage: HMO, PPO, HMO-POS, PFFS HMO (Health Maintenance Org): Generally, a PCP arranges your healthcare in the plan’s network. Some HMO plans have a Gatekeeper/Referral process. PPO (Preferred Provider Org): You can go out of network, but you’re going to pay much more. “Balance billing” by Dr’s can occur. Balance billing is when Dr’s charge you a lot more money for services since out of network services aren’t covered by the insurance carrier. HMO-POS: The Dr chooses to accept out of network patients. (No one is really an HMO-POS nowadays) PFFS: (Private Fee-for-Service): The plan determines how much it will pay doctors, other health care providers, and hospitals, and how much you must pay when you get care. Not in Utah anymore. Not all Providers will agree to treat you. They can opt out anytime.

Medicare Supplement/Medigap Policies Provides coverage after your Medicare stops Helps cover some of what Medicare Parts A & B don’t – such as coinsurance, copayments and deductibles You’ll typically pay anywhere between $70 - $279/month depending on the plan, state and insurance carrier. Average amount is $140/month. Rates can go up every year. Offered by private insurance companies Remember: Supplements have nothing to do w/Medicare Plans A – N (A, B, C, D, F, G, K, L, M, N) Most common: F, G, N (Refer to page 101 in Medicare & You handbook) Plan F is the Cadillac of plans. Part G is $20 - $30 cheaper than Plan F Part N: premiums are significantly less

MedSupp continued…. Eligibility: Generally must be enrolled in Medicare Parts A & B Resident of the state in which you are applying for coverage Age 65+ (or under age 65 with certain disabilities in some states) People of any age with end-stage renal disease Advantages: Great for those who travel Can see any provider nationwide that accepts Medicare Great for someone with a lot of health issues Peace of mind knowing that you’re fully covered (no co-pays, etc…) Cons: Can be expensive

Medicare Advantage vs. Medicare Supplement Concerns of Seniors Medicare Advantage Supplement Restrictive Network of Doctors and Hospitals YES NO Co-Payments to Providers Health Plan decides what tests and procedures are approved for you Can your plan be cancelled? Plans are approved yearly and can be dropped Can’t be cancelled as long as premiums are paid Prescription coverage

Formularies What is a formulary? A list of Prescription Drugs that your health plan covers. It lists both brand-name and generic prescription drugs. All drugs are tiered. (T1, T2, T3, T4, T5) The higher the tier, the more money you’ll pay Tier 1: Preferred Generics Tier 2: Generic Tier 3: Preferred Brand Tier 4: Non-Preferred Brand Tier 5: Specialty Tier *** Plug in their prescriptions on Medicare.gov to see which plan has the best tiers. ***Always check the GoodRx app to find the lowest price on prescriptions.

Provider Directories: Lists all providers and hospitals that are covered by the plan. You can request a hard copy of the Provider Directory OR you can search for providers using the lookup tool for each carrier. You can also download an electronic version of the directory and save it to your desktop. Simply hit Ctrl+F to open a search box. Type in the Provider’s name or hospital and it will take you to that exact page.

Part D Rx coverage Only offered by private insurance companies $18.70 - $162.10/month. Most people pay around $50/month. Deductibles, Tiers, Formularies You must be entitled to Part A or have Part B You must continue to pay your Part B Premium Each plan has a list of drugs that it covers (Formulary) 90 days vs 30 days for prescriptions Make sure their drugs are covered: - Plug in their prescriptions on Medicare.gov to see which plan offers the best Tiers (Generally, the lower the tier, the lower your copay) - Check the GoodRx app Enrollment: Coverage is NOT automatic Penalties may apply if you enroll late. 1% each moth you go without credible coverage

Donut Hole/Coverage Gap Keep in mind that you’ll get dinged if you say “Donut Hole”. The acceptable term is “Coverage Gap” 4 Phases of the Coverage Gap: 1 2 3 4 Deductible Phase Initial Coverage Coverage Gap Catastrophic $360 (standard amount) Up to $3,310 Up to $4,850 5% Now you’ll pay co-pays You’ll now pay 45% of the cost of brand name drugs You stay in this stage for the rest of the plan year. Tier 1: $ or % You’ll now pay 58% of the cost of generic drugs Tier 2 T.R.O.O.P (True real out of pocket costs) Tier 3 Tier 4 Tier 5 Only $ you’ve paid out of pocket will contribute to your Coverage Gap

Election Periods Initial Enrollment Period (IEP) 3 months before your birthday month, birthday month, and 3 months after birthday month. (7-month window) Open/Annual Enrollment Period (AEP) October 15th – December 7th Special Enrollment Period (SEP) Move? Get married? Lose coverage? Retire? 63 days before and after LIS: can change plan anytime Dual: anytime Loss EGHP: loss of employer group (voluntary or involuntary) SNF: if you go in or out of a skilled nursing facility, it opens up an SEP General Enrollment Period (GEP) Every JULY Never took Part B You can only call back from Jan 1st – April 30th Policy takes effect July 1st ***You can only enroll them the 2 months PRIOR to July 1st. (So May and June) Medicare Advantage Disenrollment Period (MADP) January 1st – February 14th

Helpful Resources Medicare & You handbook Medicare.gov GoodRx App This should be considered your Bible as a Medicare agent Pay special attention to Pages 17, 101 Medicare.gov Compare prescription costs by plan GoodRx App Find lowest cost for prescriptions Social Security: 1-800-772-1213 Medicare: 1-800-MEDICARE