More About Medicare and Changes in 2010 Provided by Copyright© 2009, 2010

Agenda Common misconceptions Differences among Medicare Parts A, B, C and D; Medigap Enrollment Medicare: 2010 changes Valuable resources

Common Misconceptions “Medicare is free and covers everything.” “Medicare Part A with a Medigap policy is enough.” “I can enroll in Medicare whenever I want to.” My doctor will tell me what I need for Medicare coverage.” “Medicare will cover my long-term care.”

What Seniors Are Saying... “I turn 65 next year and I’m counting on my Medicare to replace my current insurance.” “There are so many moving parts to Medicare, I’m confused.” “Where would I find information to help me understand my Medicare insurance benefits?” “Help, I need somebody, help, not just anybody…” -- The Beatles

Benefits of Understanding Medicare Make better decisions for your health care, short- and long-term Have information and resources to address future needs Potential to avoid or reduce stress on the family

Medicare - Since 1965… Changes in coverage Increasing premiums More out-of-pocket expenses New plan - prescription drugs Do you think things might keep changing?

“Medicare Patients in the Cold as MDs Balk at Bare-bones Fees” Denver Post March 17, 2009

What is Medicare? Medicare is health insurance for people: Age 65 or older Under age 65 with certain disabilities Any age with End-Stage Renal Disease (ESRD) -- permanent kidney failure requiring dialysis or a kidney transplant

Medicare’s Goal To make it easy for you to get the highest quality health care at the most affordable price. To transform itself from a program which simply pays the bills to a program which actively supports a high quality health care system.

Medicare and Medigap: A Family of Coverage Part A = Oldest child Part B = Next oldest Part C= Middle child Part D = Next child Medigap= Last child

Part A – Oldest Child Part A is hospital insurance for inpatient care  Rehabilitation facilities  Some skilled nursing facility care  Hospice care  Some skilled home health care Medically necessary and reasonable treatments

Part A continued Must show significant improvement Outpatient therapy ordered by doctor and provided by Medicare-certified home health agency  Part time or intermittent skilled nursing  Speech-language  Occupational and physical Entitlement program; majority of beneficiaries do not pay premiums

Part A + Employer Plan For seniors who continue to work: Comprehensive Both plans pay; one is primary provider Employer plan covers Part A co-pays and deductibles, regardless of who the primary provider is

Which Plan Pays First? At the time the claim is submitted -- Employer plan administrator Health care provider Medicare Determine which plan is the primary coverage based on Medicare rules

Part B – Next Oldest Child Medically necessary services  Doctor  Outpatient care  Some preventive services  Variety of medical services Voluntary plan; monthly premium paid by deduction from Social Security check

Part C – Middle Child Called Medicare Advantage Plans Cover Parts A and B plus provide additional coverage Offered by private companies Voluntary program; Part C premiums (if any) are paid directly to the plan provider; senior must still pay Part B premiums, too

Part C Medicare Advantage continued More coverage than Parts A and B, especially preventive services Vision exams and eyeglasses Dental Health and wellness programs Rx (most include Medicare drug prescriptions)

Part D – Next Child Prescription Drug Plan – 2004 Must have Part A or Part B to enroll – or if you have a Medicare Advantage Plan, both Parts A and B Private companies sell plans Must live in plan’s service area

Part D Costs Plans vary in cost and drugs covered Co-pays or coinsurance Deductibles Monthly premiums Drug costs Voluntary program; senior pays premiums out-of-pocket or premiums are included in Part C Medicare Advantage Plan

Medigap - Last Child Also called Medicare Supplement Plans Sold by private insurance agents MUST have Parts A and B to buy Covers only 1 person Helps pay costs that Parts A and B don’t:  Co-pays  Coinsurance  Deductibles Voluntary program; senior pays for it

Medigap Plans continued Standardized plans – A through L  A is basic coverage; more in B – L; some offer out-of-country coverage  June 1, 2010: New plans M and N; and E, H, I and J no longer available for purchase Cost varies Don’t need if you have a Part C Medicare Advantage plan

Medicare Case Study Handout: Deciding if you want Original Medicare or a Medicare Advantage Plan

When to Enroll or Change Your Medicare, Medigap Plans Part A and Part B enrollments  Automatic  Initial  General  Special Part C Medicare Advantage Plans Part D Prescription Drug Medigap Supplemental Plans Handout: Medicare Enrollment Overview

Annual Changes in Medicare All parts of Medicare  New premiums  New limits New plans added Where to learn more:

Part A – 2010 Premium $0 if senior paid at least 40 credits to Social Security during working years $461 per month if less than 40 credits paid

Part A 2010 continued For each benefit period in a year: Deductible: $1,100 for each hospital stay of 1-60 days Coinsurance - hospital:  $275 per day - days  $550 per day - days (60 Lifetime Reserve Days Skilled Nursing Facility (SNF):  $0 - days 1-20  $ per day - days

Part B – 2010 Premium is based on income  Individual: $ per month for adjusted gross income equal to or under $85,000  Joint tax return: Up to $ per month for highest adjusted gross income above $428,000

Part B 2010 continued Deductible is $155 annually Co-pay or coinsurance Senior pays these amounts for most doctor services, durable medical equipment, and outpatient mental health care Co-pay (cash out-of-pocket) or coinsurance (another carrier)

Part C – 2010 Premiums vary depending on provider and plan – some are $0 Pays out-of-pocket costs for:  Co-pays  Coinsurance  Deductibles Don’t need a Medigap Plan

Part D Premium Averages about $35 per month Can go up to $121 or more per month State-specific Handout: Medicare Part D Coverage

Future of Medicare “Absent fundamental reforms, over the next two decades the average American household’s health-care spending, including the portion of its taxes that pays for Medicare and Medicaid, will go from 23% to 41% of average household income.

Medicare Future continued By curtailing revenues, today’s recession will bring closer the projected exhaustion of the Medicare Part A trust fund from early 2019 to perhaps 2016.” -- Michael Levitt Former Secretary of Health and Human Services

Last Thoughts… In 1965 America’s median age was 28.4, now it is 36.6 The average life expectancy is age 80 Ratio of workers to seniors has steadily declined; number of seniors living long enough to have 5 or more chronic conditions -- 23% of Medicare beneficiaries -- has increased Source: George Will, The Washington Post

Long-Term Care -- Does Medicare Cover It? Part A – Partially; only skilled, not custodial care Part B – No Part C – No Part D – No Medigap Supplement Plans - No

Valuable Resources MEDICARE Medicare & You 2010 Handbook /pdf/10050.pdf  Handout from Medicare & You 2010: Where to Get Your Medicare Questions Answered