REACH National Medicare Training Program Speaker Name Group Name Date

2 Medigap Module 3

3 Session Topics Overview Medicare-approved drug discount cards Medigap benefits Medigap plans Medigap costs More information MMA

4 Session Topics Overview Medicare-approved drug discount cards Medigap benefits Medigap plans Medigap costs More information

5 What Is a Medigap Policy? Policy sold by private insurance company Fills the “gaps” in Original Medicare Plan Currently 10 standard plans called A to J –Set of standard benefits for each standard plan – New and/or revised standard plans in 2006 Costs may vary Overview MMA

6 What Is A Medigap Policy Helps pay costs with Original Medicare Don't need a Medigap policy if in –Medicare Managed Care plan –Private Fee-for-Service plan Can go to any doctor, hospital, or provider –Unless you have a Medigap SELECT policy M+C plans or Medicare Advantage Overview

7 Medigap Is Not Coverage you get from employer or union A Medicare Managed Care plan –Like an HMO A Private Fee-for-Service plan Medicare Part B Medicaid Overview

8 Who Can Buy Medigap? Must have Medicare Parts A and B May not be able to buy Medigap if under 65 Medigap policies only work with the Original Medicare Plan –Except under certain circumstances Overview

9 Medigap & Medicare Advantage Plans Medicare Advantage (formerly M+C) enrollees –May not need Medigap –Not legal to sell you a Medigap policy –May keep a Medigap policy you already have Will not pay coinsurance and deductibles Policy may provide little benefit Learn about options before making a decision Overview

10 Session Topics Overview Medicare-approved drug discount cards Medigap benefits Medigap plans Medigap costs More information

11 Medicare-Approved Drug Discount Cards New discount cards available for people with Medicare –Except those with outpatient prescription drug coverage through Medicaid Cards have Medicare-approved seal Cards help save on prescriptions –Other discount programs may also save money –Important to compare cards and programs Some people may be eligible for up to a $600 credit annually Drug Discount Card

12 Discount Card Overview This new program is –Voluntary –Temporary –An important first step The program will provide –Access to discounts –Up to a $600 credit annually for those who qualify Based on income and other drug coverage Drug Discount Card

13 $600 Credit Eligibility Eligibility for $600 credit –Entitled to or enrolled in Part A and/or enrolled in Part B –No other health insurance with prescription drug coverage (except M+C or Medigap) –Income of $12,569 or less if single –Income of $16,862 (combined) or less if married New levels will be available in February 2005 Drug Discount Card

14 Session Topics Overview Medicare-approved drug discount cards Medigap benefits Medigap plans Medigap costs More information

15 Why Do You Need Medigap? Original Medicare does not pay all health care costs Medigap policy may help you –Lower your out-of-pocket costs –Get more health insurance coverage Medigap Benefits

16 What to Consider Whether your doctor accepts “assignment” How often you need health care What type of health care you need Which Medigap policy you buy Whether you have other health insurance Medigap Benefits

17 Gaps in Original Medicare Plan Hospital Stays Skilled Nursing Blood è$876 deductible for days 1-60 è$219 per day for days è$438 per day for days èUp to $ for days èFirst 3 pints if not replaced Medigap Benefits What you pay for in 2004

18 Gaps in Original Medicare Plan Part B Deductible Part B Services è$100 per year è20% for most covered services è50% for outpatient mental health èOutpatient copayments Medigap Benefits What you pay for in 2004 (cont.)

19 What Do Medigap Policies Cover? Basic core benefits (included in all plans) –Part A coinsurance for inpatient hospital care –Cost of 365 extra days of inpatient hospital care –Part B coinsurance –First 3 pints of blood each year Most plans have additional benefits Medigap Benefits

20 Other Medigap Benefits Some Medigap policies cover –Routine yearly check-ups –At-home recovery –Medicare Part B excess charges (limiting charge) –And more Medigap Benefits

21 Items Not Covered Long-term care Vision and dental care Hearing aids Private-duty nursing Medigap Benefits

22 Let’s look at a case study… Jonathan is a 65-year-old Medicare beneficiary who is enrolled in Original Medicare Parts A and B. He has a Medigap policy and thinks the first 3 pints of blood each year are covered by his Medigap policy. Is he correct? What are some core Medigap benefits?

23 Session Topics Overview Medicare-approved drug discount cards Medigap benefits Medigap plans Medigap costs More information

24 Specific Medigap Plans Plans with prescription drug coverage (plans H, I, J) –Medicare-approved drug discount cards Also offer help with prescription drug costs Not a Medigap plan High deductible plans (plans F, J) Medicare SELECT Medigap Plans MMA

Prescription Drug Coverage Plans H and I –“Basic” prescription drug benefit –$250 deductible –50% up to $1,250 per year Plan J –“Extended” prescription drug benefit –$250 deductible –50% up to $3,000 per year Medigap Plans

26 What to Consider With H, I, or J Plans H and I –You should have at least $2,750 per year in drug costs for maximum benefits –Cover half your costs after deductible Plan J –You should have at least $6,250 per year in drug costs for maximum benefits Medigap Plans

27 Medigap Plans H, I, and J in 2006 On or after 1/1/06 may not be –Sold –Issued –Renewed Policy can be renewed if modified to exclude drug coverage or if you do not enroll in a Medicare prescription drug plan Medigap Plans MMA

28 High Deductible Option “High deductible option” on plans F and J $1,690 deductible for 2004 –Amount can go up each year Often cost less –Out-of-pocket costs will be higher –May not be able to change plans Additional deductibles –Prescription drugs –Foreign travel Medigap Plans

29 Medicare SELECT Type of Medigap policy One of 10 current Medigap plans A to J Use specific hospitals and doctors to get full benefits –Except in an emergency Generally cost less Might not be offered in your state If you have SELECT, can switch to Medigap of same or lower value Medigap Plans

30 Minnesota, Massachusetts, and Wisconsin Standardized plans NOT labeled “Plans A to J” Offer comparable benefits For information –Call your state insurance department Medigap Plans

31 Session Topics Overview Medicare-approved drug discount cards Medigap benefits Medigap plans Medigap costs More information

32 How Much Does Medigap Cost? Depends on –Your age (in some states) –Where you live –Company selling the policy Can be big differences in premiums for exactly the same coverage Compare the same Medigap policies Medigap Costs

33 Medigap Policy Premiums Three ways of pricing policies based on age 1. No-age-rated (community-rated) –Everyone pays same rate 2. Issue-age-rated –Based on age when purchased –Price does not go up as you get older 3. Attained-age-rated –Costs go up automatically as you get older Medigap Costs

34 What is Underwriting? Review of health status and medical history –Insurance company determines Whether to accept your application How much to charge you Whether to make you wait for some benefits You usually answer medical questions –Fill out the application carefully Medigap Costs

35 Buying a Medigap Policy May be able to buy a policy any time Best time is during open enrollment period –Lasts for 6 months –Starts on the first day of the month you are Age 65 or older AND Enrolled in Medicare Part B Once 6-month Medigap open enrollment period starts, it can't be changed Medigap Costs

36 Waiting to Enroll in Part B Medigap open enrollment period starts –Age 65 and enrolled in Part B Consider waiting to enroll in Part B –If you or your spouse are working and –You have group health coverage Once 6-month Medigap open enrollment period starts, it can't be changed Medigap Costs

37 Buying a Medigap Policy Important decision Shop carefully and follow five steps 1.Look at which benefits best meet your needs 2.Find out which insurance companies sell Medigap policies in your State 3.Call the companies and compare costs 4.Choose the best Medigap policy for you 5.Buy the Medigap policy Medigap Costs

38 Let’s look at a case study… It is October 1, 2004, and Sam (who is 65) wants to buy a Medigap policy. He needs to know if he is in his open enrollment period. He looks at his Medicare card. His Medicare Part B coverage started August 1, Is Sam in his open enrollment period?

39 Session Topics Overview Medicare-approved drug discount cards Medigap benefits Medigap plans Medigap costs More information

40 Getting Information Call your state insurance department –See if your state has a rate guide or shopper’s guide Call MEDICARE Call your SHIP Visit More information

41 Local Information

42 Medigap in Detail

43 Session Topics Medigap coverage Under age 65 Medigap & Medicaid Guaranteed issue More information

44 Session Topics Medigap coverage Under age 65 Medigap & Medicaid Guaranteed issue More information

45 Pre-existing Condition A health problem you had before the date a new insurance policy starts Medigap insurance company can refuse to cover health problems for up to 6 months in some cases Called a "pre-existing condition waiting period" Only if your health problem was diagnosed or treated during the 6 months before the policy started Medigap Coverage

46 Prior Creditable Coverage Previous health coverage that reduces the time you have to wait before pre-existing health conditions are covered by a policy you buy during your Medigap open enrollment period –With no break in coverage over 63 days Medigap Coverage

47 Types of Prior Creditable Coverage Union/employer GHP Health insurance policy Medicare Part A or B Medicaid IHS or tribal organization A state health benefits risk pool TRICARE FEHBP Public health plan Health plan under the Peace Corps Act Medigap Coverage

48 Let’s look at a case study Harry is 65 and has heart disease. His Medicare Part A and B started November 1, Before that date, he had no health insurance coverage. On March 1, 2004, Harry buys a Medigap policy. His Medigap insurance company refuses to cover his heart disease condition for 6 months (the pre-existing condition waiting period). Does Harry have prior creditable coverage?

49 Session Topics Medigap coverage Under age 65 Medigap & Medicaid Guaranteed issue Other supplemental insurance More information

50 Medigap for People Under 65 Medicare due to a disability or ESRD –May not be able to buy a Medigap policy –Right to choose and buy any Medigap policy at age 65 Companies cannot refuse to sell Medigap because of disability or other health problem 6-month open enrollment period Under age 65

51 Medigap for People Under 65 Some states require Medigap be offered to people under 65 with Medicare Part B –Another Medigap open enrollment period at 65 Some companies choose to sell Medigap policies to people under 65 –Policies may cost more Under age 65

52 Right to Suspend Medigap Under 65 and entitled due to a disability –Right to suspend your Medigap policy While enrolled in your own or your spouse's employer group health plan Without penalty –Get your Medigap policy back at any time –Must notify Medigap insurer within 90 days of losing employer group health plan coverage Under age 65

53 Let’s look at a case study… Martin just enrolled in the Original Medicare Plan. He is concerned about his ability to pay the coinsurance and deductible if he is ever admitted to the hospital for a lengthy stay. Would a Medigap policy cover Martin’s coinsurance for an inpatient hospital stay?

54 Session Topics Medigap coverage Under age 65 Medigap & Medicaid Guaranteed issue Other supplemental insurance More information

55 Medicare Savings Programs Help people with Medicare save money You can apply for these programs if you: –Have Medicare Part A –Have limited resources –Have limited income Less than $1,031 per month for an individual or Less than $1,384 per month for a couple Some states may have more generous income and/or resource requirements Medigap & Medicaid

56 Medigap and Medicaid Most health care costs are covered if you have both Medicare and Medicaid For information, call state Medicaid office If you have Medicaid, an insurance company can sell you a Medigap policy only in certain situations Medigap & Medicaid

57 Suspending Medigap Right to suspend Medigap while on Medicaid –You do not pay premiums –Policy will not pay benefits –Can suspend policy for up to 2 years –Can start it up again Without new medical underwriting or pre- existing condition waiting periods Must notify Medigap insurer within 90 days Call State Medicaid office Medigap & Medicaid

58 Session Topics Medigap coverage Under age 65 Medigap & Medicaid Guaranteed issue Other supplemental insurance More information

59 Medigap Protections Also called “guaranteed issue” Special rights to buy a Medigap policy –Only in certain situations Protections are from Federal law Many states provide more Medigap protections Keep letters, claim denials, postmarked envelopes Call your SHIP or state insurance department Guaranteed Issue

60 Important Message Apply for a Medigap policy early –Choose to start Medigap coverage immediately after your health plan coverage ends –Prevents gaps in your health coverage You have protection –Insurance company cannot refuse to sell you a policy or charge you more for it –If you drop Medigap, you may not be able to get your policy back Guaranteed Issue

61 Summary of Medigap Protections In some situations you have a guaranteed issue right –Right to buy a Medigap policy In these situations, an insurance company –Cannot deny you Medigap coverage –Cannot place conditions on a policy –Must cover you for all pre-existing conditions –Cannot charge you more because of past or present health problems Guaranteed Issue

62 You May Have “Guaranteed Issue” if… Medicare Advantage or PACE coverage ends EGHP coverage that supplements Medicare ends You move out of the plan's service area You joined a Medicare Advantage or PACE plan when first eligible for Medicare at age 65 and leave within 12 months Guaranteed Issue

63 You May Have “Guaranteed Issue” if… You dropped a Medigap policy to join a Medicare Advantage plan, Medicare SELECT policy, or PACE program for the first time, and you have been in the plan less than a year and want to leave Medigap coverage ends through no fault of your own Plan or insurance company has committed fraud Guaranteed Issue

64 Your Rights Depending on your situation, you have a guaranteed right to purchase –Medigap A, B, C, or F OR –Your previous Medigap policy if available OR –Any Medigap policy Guaranteed Issue

65 Important Message When Your Medicare Advantage Plan Leaves Plan will send final notification letter Keep –Copy of letter (make sure your name is on it) –The envelope –Dated copy of Medigap application –Any insurance company denial letters If you leave before final notification letter, you may not have “guaranteed issue” Guaranteed Issue

66 ESRD Rights Can enroll in another Medicare Advantage plan if plan terminated or reduced its service area Retroactive –Includes those whose enrollment terminated involuntarily on or after December 31, 1998 Guaranteed Issue

67 Let’s look at a case study… Jennie is 69 and joined a Medicare + Choice plan when she first was eligible for Medicare at age 65. She decided that she would like to drop her Medicare Advantage plan and go to Original Medicare. Does Jennie have a guaranteed issue right to a Medigap policy?

68 Session Topics Medigap coverage Under age 65 Medigap & Medicaid Guaranteed issue Other supplemental insurance More information

69 Other Supplemental Insurance Group health coverage –Employer –Union –Organization –Association –TRICARE for Life COBRA Understand your benefits and costs Other supplemental insurance

70 Session Topics Medigap coverage Under age 65 Medigap & Medicaid Guaranteed issue Other supplemental insurance More information

71 Information Sources for Medigap 2004 Guide to Health Insurance for People with Medicare: Choosing A Medigap Policy State insurance department SHIP Medigap Compare at MEDICARE – –TTY More information

72 Key Concepts Medigap plans –Fill gaps in the Original Medicare Plan –Are standardized Medigap “guaranteed issue” protections –Guaranteed under Federal law Information sources are available More information

73 Thanks for your attention…