Medicare Part A Medicare Part B Medicare Part C Medicare Part D Medicare Basics Medicare Part A Medicare Part B Medicare Part C Medicare Part D

What is Medicare?

Medicare A health insurance program for people: 65 years of age and older Under age 65 with certain disabilities With End Stage Renal Disease (ESRD) With Amyotrophic Lateral Sclerosis (ALS) a/k/a “Lou Gehrig’s Disease” Signed into law by President Johnson in 1965 Administered by the Centers for Medicare & Medicaid Services (CMS) Enrollment Social Security (SSA) Railroad Retirement Board (RRB)

The Medicare Card Medicare beneficiaries show their “red, white and blue card” when obtaining Original Medicare health benefits.

How Medicare is financed Medicare is financed by a combination of: Payroll taxes (41%) General revenues (39%) Beneficiary premiums (12%) Interest and other sources Part A is funded mainly by a dedicated tax of 2.9% of earnings paid by employers and employees (1.45% each) deposited into the Hospital Insurance Trust Fund. Part B is funded by general revenues and beneficiary premiums. The standard premium for 2013 is $104.90. Beneficiaries with higher incomes ($85,000 or more/individual; $170,000 or more/couple, will pay a higher, income-related monthly Part B premium. Part C (Medicare Advantage) plans are not separately financed. They provide benefits under Parts A, B and D. Part D (Prescription Drug) is funded by general revenues, beneficiary premiums, and state payments.

Original Medicare – Parts A & B Part A Part B

Medicare Advantage Plans Medicare Parts A, B, C & D Original Medicare Part C Medicare Advantage Plans Part A Part B Part D Prescription Drug Plans

Medicare Prescription Drugs Medicare A, B, C and D Inpatient Hospital Skilled Nursing Facility (SNF) Home Health Care Hospice (Original Medicare) Part C Medicare Advantage Medically necessary services, i.e., physicians and outpatient care Some preventive care Durable Medical Equipment (Original Medicare) Part A Hospital Combines Medicare Parts A and B and sometimes Part D. These plans cover medically necessary services that Original Medicare covers. Plans can charge premiums, co-payments, co-insurance or deductibles for these services. Part B Medical Helps cover prescription drugs and their costs. Part D Medicare Prescription Drugs

Applying for Medicare Apply 3 months before age 65 Don’t have to be retired Contact the Social Security Administration Enrollment automatic if receiving Social Security Railroad Retirement benefits

Original Medicare – Parts A & B When a person is enrolled in Medicare, they will have choices that affect: Cost Doctor selection Benefits Convenience Medicare laws and coverage are difficult to understand. Each beneficiary receives an annual copy of the Medicare & You Handbook. Some beneficiaries have a very good understanding of Medicare while others depend on the Sales Agent as the “expert”.

Medicare Part A

Medicare Part A eligibility Social Security determines if a person has to pay a premium for Medicare Part A. A beneficiary may not qualify for premium-free Part A coverage if the individual or spouse: Did not pay Medicare taxes while employed, or Did not work enough years (10 years)

Part A eligibility – cont’d. Most people receive Part A premium free because either the individual or spouse worked 40 or more quarters of Medicare-covered employment. Individuals with 30-39 quarters will have a Part A premium of $248 per month. The Part A premium is $451.00 per month for people who are not otherwise eligible for premium-free hospital insurance and have less than 30 quarters of Medicare-covered employment. If the beneficiary isn’t eligible for premium-free Part A, and doesn't buy it when they're first eligible, they can sign up between January 1st –March 31st (General Enrollment Period ) each year. Their coverage will begin July 1st .

Part A eligibility – cont’d. Part A Late Enrollment Penalty Their monthly premium may go up 10%. They'll have to pay the higher premium for twice the number of years they could have had Part A, but didn't sign up. For example, if the beneficiary was eligible for Part A for 2 years but didn’t sign-up, they will have to pay the higher premium for 4 years. If the beneficiary didn’t sign up for Part A when they were first eligible because they were covered under a group health plan based on current employment, they will have a Special Enrollment Period (SEP) in which they can sign up without incurring a late enrollment penalty. The SEP is anytime that they or their spouse (or family member, if they’re disabled) is working, and they’re covered by a group health plan through the employer or union based on that work; or The 8-month period that begins the month after the employment ends or the group health plan insurance based on current employment ends, whichever happens first.

Part A helps to pay for Hospital inpatient care Skilled nursing facility (SNF) care Home health care Hospice care Blood

Benefit period A “benefit period” begins the day a beneficiary is admitted to a hospital or skilled nursing facility (SNF). The benefit period ends when they haven’t received any hospital care (or skilled care in an SNF) for 60 days in a row. If a beneficiary goes into a hospital or a Skilled Nursing Facility after one benefit period has ended, a new benefit period begins. They must pay the inpatient hospital deductible for each benefit period. There is no limit to the number of benefit periods.

Part A Hospital Part A: (pays for inpatient hospital, skilled nursing facility, and some home health care). For each benefit period, Medicare pays all covered costs except the Medicare Part A deductible during the first 60 days and coinsurance amounts for hospital stays that last beyond 60 days and no more than 150 days. For each benefit period an individual pays: A total of $1,184 for a hospital stay of 1-60 days. $296 per day for days 61-90 of a hospital stay. $592 per day for days 91-150 of a hospital stay (Lifetime Reserve Days). All costs for each day beyond 150 days

Part A drug coverage Generally covers all drugs During a covered hospital or skilled nursing facility stay And receiving drugs as part of treatment

Part A Skilled Nursing Facility (SNF) Skilled Nursing Facility Coinsurance A beneficiary pays $0 for days 1-20 of a SNF stay each benefit period following a qualifying 3 day hospital stay per benefit period. $148.00 per day for days 21 through 100 each benefit period. Medicare covers 100 days of skilled care in a SNF each benefit period. The Medicare beneficiary pays 100% after day 100 of a SNF stay each benefit period. A new benefit period will renew the 100 days of coverage. A physician must certify that the beneficiary needs skilled care in the SNF on a daily basis. This is not custodial long term care.

Part A Home Health Care Home health care is health care/palliative care offered in the patient’s home by healthcare experts. The objective of home health care is for individuals to stay in their homes instead of using residential or institutionalized care. Care must be provided by a Medicare-certified home health agency. The type of care includes: Wound care Evaluation (psychologically/ medically) Drug management Pain management Speech therapy Physiotherapy Occupational therapy Also includes durable medical equipment and medical supplies used at home.

Medicare Hospice A Medicare-approved hospice program is for those who are terminally ill (the last 6 months of life). Medicare Part A will pay for care provided by a Medicare-certified hospice, usually in the home, but can also be provided in a hospital or other facility. Care includes drugs for pain relief – co-pay is up to $5/drug No co-pay for Medicare approved inpatient respite care.

Knowledge check 1. Who determines if a person has to pay a premium for Part A? a. Medicare b. CMS c. Social Security d. IRS

Knowledge check 2. When does a Part A benefit period end? a. The day of discharge from the hospital or SNF. b. When the person hasn’t received any hospital or SNF care for 60 days in a row. c. After all lifetime reserve days are used d. December 31st.

Knowledge check 3. Home Health Care does not include: a. Wound care b. Physical, speech and occupational therapy c. Adult Day Care d. Durable Medical Equipment used at home e. Drug management

Knowledge check 4. When is Part A premium free? a. Once a person turns 65 b. Never c. When the individual or their spouse has worked over 10 years of Medicare-covered employment d. They are an Armed Forces veteran

Knowledge check 5. Medicare-approved hospice care is for those terminally ill with a life expectancy of: a. 3 months b. 6 months c. 9 months d. 1 year

Medicare Part B

Part B Medical Insurance Part B helps cover medically-necessary services like doctors' services, outpatient care, home health services, durable medical equipment and other medical services. Part B also covers some preventive services. How Much Does Part B Cost? Most people will pay the standard premium amount which, for 2013 is $104.90. If they don't sign up for Part B when they are first eligible, they may have to pay a late enrollment penalty. The yearly deductible for 2013 is $147.00. (They pay 20% of the Medicare-approved amount for services after they meet the $147.00 deductible.)

Enrolling in Part B Initial Coverage Election Period (ICEP) – Turning 65 7 months starting 3 months before month of eligibility – the month of eligibility and 3 months after Eligibility First day of the month of a beneficiary’s 65th birthday, unless The birthday falls on the first of the month; then the beneficiary is eligible the month prior.

Enrolling in Part B Late Enrollment General Enrollment Period (GEP) January 1st through March 31st each year Coverage effective July 1st Premium penalty 10% for each 12-month period eligible but not enrolled Paid for as long as the person has Part B Limited exceptions Beneficiary must wait until April 1st (three months before the effective date of July 1st) before they can enroll in an Medicare Advantage plan.

Enrolling in Part B An individual may delay enrolling in Part B with no penalty if: Covered under employer or union group health plan Based on current employment Person or spouse Will get a Special Enrollment Period (SEP) Ends 8 months after the employer or union coverage ends.

Part B coverage Doctors’ services Outpatient medical/surgical services & supplies Diagnostic tests Dialysis Outpatient therapy Outpatient mental health services Some preventive health care services Durable Medical Equipment (DME) Other medical services

Preventive care Abdominal Aortic Aneurysm Alcohol Misuse Counseling Bone Mass Measurement Breast Cancer Screening (Mammogram) Cardiovascular Screening Colorectal Cancer Screening Depression Screening Diabetes screening Flu Shot Hepatitis B Shot Immunizations (shots) One-time “Welcome to Medicare” Physical Exam Obesity screening and counseling Pap Test and Pelvic Exam Pneumococcal Shot Prostate Cancer Screening 16 Prostate Specific Antigen (PSA) Sexually transmitted infections screening and counseling Smoking Cessation Yearly “Wellness” Exam

Part B drug coverage Part B covers a limited set of outpatient drugs Injectable and infusible drugs Not usually self-administered Furnished and administered as part of a physician service

Part B drug coverage Oral drugs or DME drugs covered by Part B Supplier must be DME provider Drug must be medically necessary and must be according to guidelines Drugs administered through Part B-covered Durable Medical Equipment (DME) Such as nebulizer or pump Only when used with DME in patient’s home Oral drugs with special coverage requirements Anti-cancer drugs Anti-emetic drugs Immunosuppressive drugs And other non-oral forms

Additional Part B information Part B can pay for some ancillary services normally covered under Part A when received during hospital and SNF stays if: Person does not have Part A coverage Part A coverage for the stay has run out Note: Stay is not covered

Knowledge check 1. How much is the Part B deductible for 2013? a. $96.40 b. $99.90 c. $147.00 d. $1,156.00

Knowledge check 2. How long must a Part B late enrollee pay the 10% penalty? a. One year b. One month for each month eligible but not enrolled c. For as long as the person has Part B d. Until the first leap year

Knowledge check 3. Which is not a Part B covered service? a. Abdominal aortic aneurysm b. Colorectal cancer screening c. Shingles vaccine d. Pneumococcal immunization

Knowledge check 4. Upon turning 65, the enrollment period for Part B is: a. 4 months b. 7 months c. 9 months d. 1 year

Knowledge check 5. An individual may delay enrolling in Part B with no penalty if there is coverage under an employer’s or union group’s health plan. The individual will have an SEP ending how many months after the employer/union coverage ends? a. 2 b. 7 c. 3 d. 8

Medicare Supplements

Standardized plans

Medigap key points Sold by private insurance companies Costs vary by plan, company and location Covers “gaps” in Original Medicare (varies by Plan) Deductibles, coinsurance, copayments Does not work with Medicare Advantage Plans Up to 10 standardized plans A – N Generally must have Medicare Parts A and B There is a monthly premium for the Medigap coverage They do not work with Medicare Advantage Plans

Medigap SELECT plans Medicare SELECT is a type of Medigap policy sold in some states that requires you to use hospitals and, in some cases, doctors within its network to be eligible for full insurance benefits (except in an emergency). Medicare SELECT can be any of the standardized Medigap Plans. These policies generally cost less than other Medigap policies. If you do not use a Medicare SELECT hospital or doctor for non-emergency services, you will have to pay what Medicare does not pay. Medicare will pay its share of approved charges no matter which hospital or doctor you choose.

When to buy Medigap policy May be able to buy a Medigap policy any time If insurance company will sell to the beneficiary Medigap open enrollment period (OEP) 6-months when insurance company must sell One OEP begins at the age of 65 or older and enrolled in Part B Can’t be changed or replaced Some states have more generous rules

Open enrollment period (OEP) May be able to buy a Medigap policy any time If insurance company will sell to the beneficiary Medigap open enrollment period (OEP) 6-months when insurance company must sell One OEP begins at the age of 65 or older and enrolled in Part B Can’t be changed or replaced Some states have more generous rules

Medicare Part C

Medicare Advantage (MA) Plans Variety of plans: Health Maintenance Organization (HMO) Plans Some have a Point-of-Service option Preferred Provider Organization (PPO) Plans Private Fee-for-Service (PFFS) Plans Special Needs Plans (SNP) Medical Savings Account (MSA) Plans

Who can join? Eligibility requirements Live in plan’s service area Enrolled in Medicare Part A Enrolled in Medicare Part B Does not have End-Stage Renal Disease (ESRD) at time of enrollment Some exceptions: have had a successful kidney transplant over 36 months ago EGH plan is same organization offering the MA Plan and the MA plan will be the primary provider of their health care coverage Want to switch to another plan within the same company Have a special needs plan available in their area for people with ESRD Currently is enrolled in an MA plan that stops being offered in their area

When can people join? A person can join MA Plan or other plan When first eligible for Medicare Initial Coverage Election Period During specific enrollment periods Annual Election Period Special Enrollment Period

When can people switch? Annual Election Period (AEP) Medicare Advantage Disenrollment Period (MADP) Special Enrollment Period (SEP) Move out of the plan’s service area OR move and have new MA or Part D options available Plan leaves Medicare program Employer/Union Group Health Plan (EGHP) Full and partial dual eligibility (Medicare & Medicaid) Low Income Subsidy

Annual Election Period (AEP) October 15th through December 7th Can choose new plan MA Plan Medicare Prescription Drug Plan Original Medicare New plan effective January 1st

Medicare Advantage Disenrollment Period (MADP)

How do MA plans work? Generally receive all Medicare-covered services through the plan Can include prescription drug coverage May have to see certain doctors or go to certain hospitals to get care Emergency care covered anywhere in the U.S. Benefits and cost-sharing may be different from Original Medicare

Out of pocket costs Generally must still pay Part B premium Some plans may pay all or part May pay an additional monthly premium Will have other out-of-pocket costs

Medicare HMO plans Copayment amounts set by plan Usually must use network doctors and hospitals May pay in full for care outside plan’s network Covered if emergency or urgently needed care POS option allows visits to “out-of-network” providers (The provider must accept the plan’s terms and conditions of payment.) May need to choose primary care doctor Sometimes need a referral to see a specialist Doctors can join or leave May include prescription drug coverage

Medicare PPO plans Can see any doctor or provider that accepts Medicare Don’t need referral to see specialist Don’t need referral to see out-of-network provider Copayment and coinsurance amounts set by plan Will usually pay more for out-of-network care The provider must accept the plan’s terms and conditions of payment. May receive Medicare prescription drug coverage Regional PPOs Available in most areas of the country Have annual limit on out-of-pocket costs Varies by plan May have higher deductible and/or premium than other PPOs

Private Fee for Service plans (PFFS) Can see any Medicare-approved doctor or hospital that accepts the plan Can get services outside service area Do not need referral to see a specialist Plan sets copayment amounts If offered, can get Medicare prescription drug coverage If not offered, can join a stand-alone Medicare Prescription Drug Plan

PFFS access requirements PFFS must meet access requirements; Network and Non-network counties Network counties must have contracts with a sufficient number and range of providers Non-employer PFFS Must meet Medicare access requirements If two or more network-based MA Plan options exist Employer and non-employer PFFS Plans may meet access requirements: Through a contracted network of providers that meet CMS requirements By paying not less than the Original Medicare payment rate Having providers deemed to be contracted as providers

Special Needs Plans (SNPs) Designed to provide Focused care management Special expertise of plan’s providers Benefits tailored to enrollee conditions Must include prescription drug coverage Individuals are identified as: Having a severe or disabling chronic condition Dual Eligibles Institutionalized beneficiaries

Medical Savings Account (MSA) In a Medicare Medical Savings Account (MSA), a high deductible health insurance plan is combined with a bank account. Medicare deposits a particular amount of money per year into the bank account and the member is allowed to use the money to pay for any health-care-related expenses throughout the year, but only Medicare-covered expenses count toward the deductible. It should be noted, however, that the deposit made by Medicare is often less than the yearly deductible, which means that if the member gets sick or medically needs care, they will likely have to spend more than the amount originally deposited into the account. After the member reaches their deductible, the plan will cover their Medicare-covered services.

Medicare Savings Program (MSP) A Medicare Savings Program receives assistance from Medicaid to pay for Medicare expenses. Assistance categories include:   Qualified Medicare Beneficiaries (QMB) Specified Low Income Medicare Beneficiaries (SLMB) Qualified Individuals (QI) Qualified Disabled and Working Individuals (QDWI) These are State specific programs.

Medicare PACE plans Programs of All-inclusive Care for the Elderly (PACE) Combine services for frail elderly people Medical Social Long-term care services Include prescription drug coverage Might be better choice than nursing home Only in states that offer it under Medicaid Qualifications vary from state to state Contact state Medical Assistance office for information

Rights in Medicare Advantage Plans People with Medicare have certain guaranteed rights to: Get their health care services when needed To learn about all treatment choices in clear language that can be understood Receive easy-to-understand information Have personal medical information kept private Additional rights and protections Access to health care providers Know how doctors are paid Fair, efficient, and timely appeals process Fast appeals in certain health care settings

Appeals in MA plans Plan must say in writing how to appeal if it: Will not pay for a service Does not allow a service Stops or reduces a course of treatment Can ask for fast (expedited) decision Plan must decide within 72 hours See plan's membership materials Include instructions on how to file an appeal or grievance

Knowledge check 1. Which is not a Medicare Advantage plan? a. HMO b. PPO c. PFFS d. ACO

Knowledge check 2. During which enrollment period can an individual not join and/or switch Medicare Advantage plans? a. AEP b. ICEP c. MADP d. SEP

Knowledge check 3. Members joining a Private Fee for Service plan: a. Can see any provider that accepts the plan b. Must obtain a referral to see a specialist c. Can see any Medicare approved provider that accepts the plan d. Can only receive services in their area

Knowledge check 4. A Special Needs Plan (SNP) must include prescription drug coverage. a. True b. False

Knowledge check 5. An HMO POS option allows visits to “out of network” providers. a. True b. False

Medicare Part D

Medicare Prescription Drug Plan (PDP) Medicare Part D Available to all people with Medicare Provided through Medicare Prescription Drug Plans Medicare Advantage and other Medicare plans Some employers and unions

Enrollment guidelines Initial Coverage Election Period (ICEP) 7 months Starts 3 months before month of eligibility Annual Election Period (AEP) October 15th through December 7th Can join, drop, or switch coverage Effective January 1st of following year Medicare Advantage Disenrollment Period (MADP) January 1st through February 14th Special Enrollment Period (SEP)

Late enrollment People who wait to enroll may pay a penalty Add 1% of national base premium “1% penalty calculation” which is $.31 in 2012 for each month eligible but not enrolled Must pay the penalty as long as enrolled in a Medicare drug plan Is waived if an individual qualifies for Extra Help Unless they have other coverage at least as good as Medicare drug coverage “Creditable coverage”

Creditable coverage Prescription drug coverage that pays as much as or more than Medicare’s standard prescription drug coverage. Entities providing creditable drug coverage include: Coverage under MAPD or PDP Group health plan Military coverage including the TRICARE program VA coverage (it is not Part D)

Network vs. out of network pharmacies A network pharmacy is a pharmacy where Plan members can get their prescription drug benefits. They are called “network pharmacies” because they contract with the Plan. An Out-of-Network Pharmacy is a pharmacy that does not have a contract with the Plan to coordinate or provide covered drugs to members of the Plan. Most drugs the member gets from out-of-network pharmacies are not covered by the Plan, unless certain conditions apply.

Prescription drug plan costs Costs vary by plan In 2013 members may pay Monthly premiums Annual deductible, no more than $325 Copayments or coinsurance Very little after $4,750 out-of-pocket May offer supplemental benefits Plan information and costs available www.medicare.gov

How the coverage works

Calculating out of pocket costs In general, Out-of-Pocket includes all payments for Medications listed on a plan's formulary and purchased at a Network or participating Pharmacy. This includes payments that are made by others on a member’s behalf. If a member switches Medicare Part D plans during the plan year, their Out-of-Pocket will be transferred to their new plan -- it travels with them.

Out of pocket Out-of-Pocket includes the amount of the Initial Deductible (if any) and the co-payments or co-insurance during the Initial Coverage stage. While in the Coverage Gap, it includes what a member pays when they fill a prescription and the amount of the 2013 Coverage Gap Discount for brand-name drugs (52.5%). Out-of-Pocket also includes payments made for a member’s drugs by any of the following programs or organizations: "Extra Help" from Medicare; Indian Health Service; AIDS drug assistance programs; most charities; and most State Pharmaceutical Assistance Programs (SPAPs).

Affordable Care Act During 2013, members who reach the coverage gap in their Medicare Part D coverage, will automatically get a 52.5% discount on covered brand-name drugs. They will receive the discount when they have the prescription filled at a pharmacy or order them through the mail, until they reach the catastrophic coverage phase. They will also get a 21% discount on generic drugs while in the coverage gap. Although the member will pay only 47.5% of the price for the brand-name drug, the entire drug cost will count toward the amount they need to qualify for catastrophic coverage. For generic drugs, only the amount the member pays will count toward getting them out of the coverage gap. The initial coverage limit is $2,970 for 2013. Catastrophic coverage for 2013 begins when your out-of-pocket reaches $4,750.

What’s excluded from out of pocket costs? Plan premium payments. Non-Formulary medications - prescription drugs not included on the plan’s drug list. "Bonus Drugs" - drugs covered by the plan’s supplemental coverage. Medication not covered by all Medicare Part D plans - for instance, over-the-counter drugs, drugs received during a hospital stay, or drugs prohibited from Part D coverage by law. Drugs purchased outside of the United States. Payments made for drugs by any of the following programs: employer or union health plans; TRICARE; VA; Worker’s Compensation; and some other programs

Access to covered drugs Plans can manage access to covered drugs Tiers Prior authorization Step therapy Quantity limits Plans must have processes in place Members obtain medically necessary prescriptions Request coverage determinations and appeals

Extra help with drug costs Low Income Subsidy (LIS), also known as Extra Help, is a fully funded federal program administered though SSA. Extra Help assists individuals with their monthly prescription premiums, yearly deductibles, copayments, coinsurance, and coverage gap. In order to qualify for Extra Help (LIS) the individual’s income and resources must meet the following criteria: Single person — 2012 Updated amounts: Income less than $16,755 and resources less than $13,070 Married person living with a spouse and no other dependents — 2012 Updated amounts: Income less than $22,695 and resources less than $26,120

Eligibility for Extra Help Who may automatically qualify People with Medicare who get Full Medicaid benefits (Duals) Supplemental Security Income (SSI) Help from Medicaid paying Medicare premiums (Medicare Savings Programs) Others must apply and qualify

2013 LIS levels

Part D - IRMAA The Part D-Income Related Monthly Adjustment Amount (Part D-IRMAA) is an additional amount some individuals are required to pay by law for Medicare Part D Drug Coverage based on their Income. Beneficiaries will pay this premium separate from their Part D Premium and it will go directly to Medicare, not to their plan. CMS will disenroll individuals who fail to pay the Part D-IRMAA from their prescription drug plan. This includes disenrollment from their MA plan or employer group plan if it includes Part D coverage. If later the beneficiary re-enrolls in Part D, they may incur a Late Enrollment Penalty for break in coverage.

Knowledge check Part A Part B Part D Part C

Knowledge check 2. How much will a member pay for brand name drugs during 2013? a. 52.5% b. 21% c. 47.5% d. 50%

Knowledge check 3. Creditable prescription drug coverage is provided through: a. Medicare prescription drug plans b. Medicare Advantage and other Medicare plans c. Some employers and unions d. All of the above

Knowledge check 4. Prescription drug coverage that pays as much as or more than Medicare’s standard prescription drug coverage is called: a. Incredible drug coverage b. A pipe dream c. Creditable drug coverage d. Credulous drug coverage

Knowledge test 5. For 2013, an individual reaches Catastrophic Coverage at which amount? a. $2,840 b. $4,450 c. $4,550 d. $4,750

Thank You