Medicare Housekeeping Time!

A good practice to get into at the beginning of each year is to take a little time and do some annual Medicare housekeeping.  The following tips are also helpful if you have recently turned 65 or retired and you’re in first year on Medicare.

 1.  Schedule Your Check-up

Whether you have Original Medicare, Original Medicare with the addition of a Medicare Supplement or a Medicare Advantage plan, you are offered a yearly wellness exam.   Don’t forget to schedule this!  The earlier in the year, the better!  This is not only important for your general health but will also help make your overall healthcare run more smoothly.  If you happen to have a Medicare Advantage plan that requires referrals for specialist visits, you might be able to get any anticipated referrals taken care of at this initial appointment with your primary care provider.  For instance, if you know you need to see your cardiologist at least two times a year get those referrals while you’re already in your PCP’s office.   You can also find out what preventative care services and screenings you should take advantage of this year.  Medicare covers the following screenings along with many others – prostate cancer, colorectal cancer, mammograms, depression, diabetes – the list goes on.   Getting into the habit of scheduling these Medicare housekeeping “peace of mind” tests at the beginning of the year will make sure that it doesn’t slip your mind.

Complete list of screenings can be found by clicking here.

2.  Authorization Form

If you are brand new to Medicare or have never taken care of this in the past, you might want to consider filling out an Authorization Form to allow family or friends to call Medicare on your behalf.  You must give prior permission in writing for someone to be given access to your personal health information.   You can “revoke” permission or change the individual listed as authorized at a later date if you’d like.  It’s just important to make sure you take care of this before it’s needed.  Find the authorization form by clicking here.

3.  MyMedicare.gov

A convenient tool for those enrolled in Original Medicare or Original Medicare plus a supplement is MyMedicare.gov.  By signing up, you will be given access to a convenient, online service that puts your personal Medicare information at your fingertips anytime day or night.   After you sign up at Medicare.gov you can begin using the site’s services by completing an “Initial Enrollment Questionnaire” that will ensure your bills are processed correctly with Medicare.  With the click of their “Blue Button” you can easily download and save your health information and files to your computer, tablet or mobile device or print off an “On the Go” report to take with you to doctor appointments.   A few other things the site conveniently keeps track of is your Part B deductible status and a record of preventative services available to you.

4.  New ID cards

Recent enrollment in a Medicare Advantage plan, Supplement or PDP also means that you will have new cards arriving in the mail.  Make sure you remember to take these along on your first visit to your PCP and to any visit with a new doctor.  Your doctor’s office will want copies of the cards on file and this will ensure there is no confusion when it comes to billing.

5.  Prescription Medications

At the beginning of the year, try to get your medication prescriptions filled early.  Getting this taken care of early will make sure that you are made aware of any formulary changes in your plan.  You should receive a notification of changes in your insurance company’s drug list if it affects you, but in case you missed it or it hasn’t made it to your mailbox yet you will at least be aware of the situation before it becomes a problem.

The Takeaway:

There are a few Medicare housekeeping items to tick off every year you’re on Medicare to ensure smooth sailing.  Hopefully addressing these issues when you first sign up for Medicare will help eliminate any bumps you might run into down the road, but if you haven’t done all of these yet, making it a practice to do some of these things every year will keep things running smoothly.

Medicare Advantage Disenrollment Period: Having Second Thoughts?

January 1 through February 14 is the annual Medicare Advantage Disenrollment Period, also known as the MADP.  This time of the year is strictly for folks who have a Medicare Advantage Plan (MAPD) and wish to drop it and revert back to Original Medicare.

If you’re like most people and you’re satisfied with your Medicare Advantage plan and all is well in the world.   By now, you should have received your ID cards in the mail and probably filled some prescriptions and all is well.  But…

If all is NOT well, or if  you’ve had some unexpected changes to either your health or your healthcare providers, this time during the year may become more important to you.  As an example, let’s say you just opened your mail and opened a letter from your beloved that your primary care physician is moving out of the plan’s network.  Could be one of your necessary prescriptions disappeared from your plan’s formulary.  If you want to go back to Original Medicare at this point (A and B) you can, and you also have to enroll in a stand-alone Medicare PDP plan, too.

Essentially, for whatever reason you choose, if you have an MAPD plan, during this timeframe you can drop it, no questions asked.  Any other time during the year you generally have to keep it.  The same time period does NOT apply to those already on Original Medicare, or those with Medicare Supplements.

To enact your rights during the Medicare Advantage Disenrollment Period, you can contact your current plan or get in touch with the folks at Medicare by calling 1-800-MEDICARE.  Your disenrollment will occur as of the first day of the month following its acceptance and at that time you will be back on Original Medicare only.  Again, you will want to pick up a PDP plan so you have prescription drug coverage and might also want to consider picking up a Supplement, also referred to as Medigap.  Check Medicare.gov to see which companies offer Supplements in your area.  Each company offers the same Supplements as their benefits are dictated by the state but each private insurance company prices the product differently.  You can compare all the plans prices at Medicare.gov.

Before you go dropping your Medicare Advantage plan , it’s important to remember you are absolutely not guaranteed enrollment in most Medicare Supplement policies unless it’s during your 6 month Open Enrollment Period that takes place when you turn 65 and/or when you enroll in Medicare Part B, whichever happens last. During this time, you have guaranteed acceptance and the insurance company cannot turn you down based on preexisting conditions and they also cannot make you wait for any treatment that was prescribed prior to your enrollment.  Which means if you’re not in your OEP that there is the possibility that you won’t be able to medically qualify for a Supplement.  If this happens, you’ll l remain on Original Medicare.   only until the fall when the next AEP rolls around.  Make sure that this is an acceptable outcome to you prior to dis-enrolling from your current plan.

The Takeaway:

Medicare Advantage Disenrollment Period can be a benefit to exercise if you’re dissatisfied with your current MAPD plan.  It can allow you to leave a plan that is not a good fit for you.  Just make sure you’re aware of the implications of doing so and are content with the benefits offered by Original Medicare.  Also be sure to pick up that Prescription Drug Plan if you don’t want to pay a late enrollment penalty down the road.

 

 

Medicare Deductibles and How to Avoid Them

Deductibles are essentially flat dollar amounts you must pay before your Medicare benefits kick in.  All told, in 2017 the total Medicare deductibles add up to potentially $3,187 in costs just for this year!  Plus, keeping up with them is no small task as they change (almost) every year.

To keep things simple, just remember this: A Medicare deductible is the amount of money you are required to spend out of your own pocket (first!) every year before your Medicare Plan starts paying for things. That’s really all there is to it.  If you have Original Medicare Part A, Original Medicare Part B and Medicare Part D, you’ll be “satisfying” deductibles before any of your claims or prescription drugs are paid for.  There are of course ways to not have to pay those deductibles, and we’ll quickly review those options below.

Some background: The Centers for Medicare and Medicaid Services (CMS) usually publish their deducible amounts for the following year in November for Medicare Part A and Medicare Part B.  They usually get around to publishing Medicare Part D deductibles in October of the prior year.  Like I said, they change every year.  Here’s what they are for 2017.

Medicare Part A Deductible:

$1,316

Medicare Part B Deductible:

$183

Medicare Part D Deductible:

$400

As I mentioned above, in 2017 this means if you have Original Medicare and a basic PDP plan, you’re going to potentially have to come up with $3,187 out of your wallet (or purse) before anything gets paid.  That’s quite a bit of money exposure I’m sure you’d much rather keep under the mattress or spend it on a vacation to the beach.  (If you do, go to the beach, make sure to see if your Medicare benefits will travel with you by clicking here).

While somewhere in the neighborhood of 20% of folks on Medicare don’t have either an MAPD or a Medicare Supplement, I’m a big fan of having some sort of supplemental or additional policy on top of having Original Medicare A and B.  I’m definitely not a big fan of going “bare with Medicare” as I outlined in a previous post, essentially because Original Medicare A and Medicare B do not protect or limit your financial exposure should a catastrophic health even happen to you.  You really need a MOOP!  If you’d like to read more about this, go ahead and click here.

The Takeaway:

If you’re shopping for Medicare Advantage plans (MAPD) the best place to do it (objectively of course) and really the ONLY place to do so to see all of your options at once is on the Medicare.gov site.  You can get there by clicking here.

If you don’t want to buy a Medicare Supplement or MAPD plan from a private insurance carrier and choose to keep Original Medicare for your medical coverage, you’ll still need to buy a PDP plan.  You can save yourself the pain of having to pay a $400 deductible for your prescription drugs by simply choosing a PDP plan that doesn’t have a deductible. Most “basic” plans (cheapest) have the deductible, but there are usually a few every year that are reasonably priced ($25-$35 per month range) that have no deducible.  You can search for those plans by clicking here, right on the Medicare.gov website.

Medicare Part B vs. Part D Prescription Drugs – Are You in the Right Medicare Plan?

If you’re in the wrong type of Medicare coverage, you may be paying a whole lot of money for prescription drugs billed under Medicare Part B, not Medicare Part D.  This is especially true if you get cancer.  How can this be?  Read on.

Medicare Part D covers Prescription Drugs, right?  Not always… Medicare Part B can play a big role.  In fact, there are many instances when Medicare Part D actually doesn’t cover all drugs you may need during the course of your healthcare.  When medical conditions get serious, many medications aren’t covered by Part D.  Instead, they’re covered by Part B.  Knowing the difference between the two could save you hundreds if not thousands of dollars when choosing your Medicare coverage.  This is especially true if you have cancer as chemotherapy drugs and all the associated medications that come into play during cancer treatment are extremely expensive.  

Medicare Part D Covers Prescriptions at Retail Pharmacy Locations or Mail Order

Generally, Part D covers prescription drugs at a retail or mail-order pharmacy.  Let’s say you get bronchitis; you make an appointment with your primary care physician, he/she sends your prescription into your local pharmacy.  When you pick it up, you pull out your PDP or your MAPD card, swipe it and pay the associated copay or coinsurance.  Simple, right?  Right.  

But what if you need a prescription drug that’s administered by a doctor? Let’s say you have macular degeneration, and you’re seeing an ophthalmologist for treatment.  Many folks with this condition get very expensive shots in the eye to slow the degeneration.  Clearly (no pun intended) you can’t do this yourself.  When this happens, the doctor actually bills the prescription under Medicare Part B, not Medicare Part D. 

Same goes for prescription drugs that are administered in an outpatient setting.  If you’re having your knee scoped or drained, and the doctor shoots localized anesthesia into your knee before the procedure, that will hit Medicare Part B, not D.    

So, generally, Part B covers drugs that usually aren’t self-administered, which is a fancy way of you’re not taking them by yourself.  The doctor, nurse practitioner, surgeon, anesthesiologist, etc. are giving them TO you.

Here’s a short list of medical conditions that, when prescription drugs are used in your treatment, are covered under Medicare Part B, and not covered under Medicare Part D.  

Cancer
  • Oral cancer drugs: Medicare helps pay for some cancer drugs you take by mouth if the same drug is available in injectable form or is a prodrug of the injectable drug. As new oral anti-cancer drugs become available, Part B may cover them.
  • Oral anti-nausea drugs: Medicare helps pay for oral anti-nausea drugs used as part of an anti-cancer chemotherapeutic regimen. The drugs must be administered immediately before, at, or within 48 hours after chemotherapy, and must be used as a full therapeutic replacement for an intravenous anti-nausea drug
Hepatitis

Hepatitis B shots: Usually a series of 3 shots covered only for people at high or medium risk for Hepatitis B.

Osteoporosis
  • Injectable osteoporosis drugs: Medicare covers an injectable drug for women with osteoporosis who meet the coverage criteria for the Medicare.
Transplants
  • Immunosuppressive drugs: Medicare covers immunosuppressive drug therapy for people who received an organ or tissue transplant for which Medicare made payment.

Other Prescriptions Covered Under Medicare Part B, not Medicare Part D

  • Some other vaccines when they’re directly related to the treatment of an injury or illness (like a tetanus shot after stepping on a nail).
  • Durable Medical Equipment (DME) supply drugs: Medicare covers drugs infused through an item of DME, like an infusion pump or a nebulizer.
  • Injectable and infused drugs: Medicare covers most injectable and infused drugs given by a licensed medical provider if the drug is considered reasonable and necessary for treatment and usually isn’t self-administered.
  • Antigens: Medicare helps pay for antigens if they’re prepared by a doctor and given by a properly instructed person (who could be the patient) under appropriate
  • Blood clotting factors: If a person with Medicare has hemophilia, Medicare helps pay for clotting factors they give themselves by injection.
  • Parenteral and enteral nutrition (intravenous and tube feeding): Medicare helps pay for certain nutrients for people who can’t absorb nutrition through their intestinal tracts or can’t take food by mouth.

Are You In The Right Medicare Plan?  

Here’s where it gets interesting.  If you have a Medicare Supplement Plan (Medigap), these drugs are usually covered at 100%, especially for the two most popular plans, Medigap C and Medigap F.  That’s because these plans cover 100% of the Medicare Part B costs, which includes the deductible and any associated coinsurance.  The third most popular Medigap plan is Plan N, and if you have this one you’d be covered at 100% after paying the Part B deductible.

If you’re on a Medicare Advantage (MAPD) plan, odds are you’ll be paying 20% of the cost for Part B drugs, all the way up to the annual Maximum Out Of Pocket (MOOP).  To make sure, you need to pull out your Annual Notice of Change or your Summary of Benefits right now.  Flip to the Section entitled, “Medicare Part B drugs.”  If I were a betting man, (and I’m not) I’d bet you right now your MAPD plan doesn’t cover Medicare Part B drugs any more than at an 80% level, leaving you 20% to pay.  You stand a very good chance of hitting your MOOP very quickly if you have cancer, or any other serious condition requiring hospitalization involving prescriptions administered by hospital staff.  

The Takeaway:

If you’re turning 65 or otherwise now eligible for Medicare, this is an often overlooked “gap” in traditional Medicare, as well as most Medicare Advantage plans.  Most agents breeze right by this section in their presentations, and it’s not prominently one of the topics in “educational” presentations or seminars.  But, you clearly need to pay attention to it since over 1.6 Million people in the United States will get cancer in a given year.  Chemotherapy drugs are not cheap by any stretch of the imagination if you happen to be stricken with cancer and neither are osteoporosis drugs.  

If you’re playing it safe and this gap is of concern to you, I’d seriously consider getting a Medicare Supplement plan, if you can afford the monthly premium.  9 out of 10 times, a MAPD plan is going to be cheaper (along with a whole other set of considerations, click here for more on those) but you’ll have to cough up 20% of the Part B drugs if you need to.  

 

The Affordable Care Act (ACA) and Medicare

The Affordable Care Act (ACA), also known as Obamacare, was enacted in March 2010 and heralded the biggest change in the US healthcare system since the creation of Medicare and Medicaid in 1965. Following the passage of the law, there was the creation of a Health Insurance Marketplace where anyone can get health insurance at an “affordable” price, since private health insurance plans have been subsidized by the government.

If you’ve been following the news at all, you’ve seen where major insurance companies have drastically shrunk the number of states they participate in, or dropped out altogether. For those who have stayed, premiums have skyrocketed. The recent presidential election has thrown a new spotlight on Obamacare, as Trump has indicated he’d support repealing ACA altogether. Politics and news coverage aside, I thought I’d spend a bit of time covering ACA as it relates to your Medicare coverage. The following are some salient facts that you need to know about the ACA, with some special emphasis on ACA and Medicare.

1. Medicare Coverage Is Protected

One important fact to recognize is that the Health Insurance marketplace does not include Medicare. This means that your Medicare coverage will not be interfered with in any way. It also means that once you have been covered under Medicare, you do not have to do anything with the marketplace during the open enrollment period.

However, people who only have Medicare Part B health insurance (which covers outpatient services) are not considered to be adequately covered and are required to supplement their insurance coverage. A failure to do this may lead to paying of a fee that is charged on those who do not have insurance. This is due to the fact that the ACA has an individual mandate included, which requires everyone eligible for health insurance cover to buy it. This is done so as to avoid healthy people from delaying getting health insurance cover until they fall sick, which something that will increase costs for everyone and lead to fewer people affording health insurance.

In 2016, the fee for not having minimum essential coverage is 2.5% of your household income or $695 per adult and $347.5 per child, whichever amount is higher.

2. Can You Choose Marketplace Coverage Instead of Medicare?

The simplest answer to this is yes, but you won’t want to do it in almost all cases.  If you’re currently on an ACA plan and turn 65 or are otherwise eligible for Medicare, you can technically keep your ACA plan. You won’t want to do that, as benefits under Original Medicare or a Medicare Advantage plan are far better and in almost all cases, cheaper than an ACA plan. However, the federal government won’t actually force you to drop your ACA plan, you must do it yourself. There are a few situations in which this scenario might be possible, for example:

If you happen to be paying monthly premiums for Part A, you can opt out of Medicare Part A and B and have a marketplace plan instead if this serves your situation better. This is highly unlikely, as most people do not pay monthly premiums for Part A because they paid for it through their taxes when they were working before turning 65.

3. Can You Get a Marketplace plan in Addition to Medicare?

It is actually illegal for anyone to offer you a marketplace plan if they know or if you already have Medicare coverage. This applies even to cases where you have either Part A or Part B. If you feel the need to plug a gap in your Medicare coverage, then the right thing to do is adding on supplemental Medicare insurance, also known as Medigap insurance. It is also not possible to purchase a standalone dental plan on the marketplace if you have Medicare coverage.

4. Cancelling Your ACA Plan When you Get Medicare

You can do this online. Click here and follow the directions.

The Takeaway:

Once you turn 65, or are otherwise eligible for Medicare, you don’t need your ACA plan any longer. If you have a Marketplace plan, you can keep it until your Medicare coverage starts. Then you can end your Marketplace plan without penalty. However, you’ll have to take action to cancel your ACA policy as soon as your Medicare coverage begins. The government won’t cancel it for you, you have to do it. If you don’t, you’ll essentially be left paying your applicable Medicare premiums as well as your ACA plan premium, even though you can’t use the ACA plan any longer to pay for your healthcare.

2017 Medicare Star Ratings Released

Medicare Advantage Star Ratings have been released for 2017 and for some large insurers, the news isn’t pretty. The news is substantially better for smaller, regional plans which follows a historic trend. However, whether or not a 5 star plan is available to you largely depends on where you live. What does this mean for you and your wallet? Read on.

Medicare Star Ratings – Why They’re Important to You

The Centers for Medicare & Medicaid Services’ (CMS) five-star ratings of private Medicare plans are a big deal for insurance companies, as higher ratings are tied to considerable bonus payments from CMS to them. Check out my post on Star Ratings for additional background by clicking here.

Some of these payments can be kept by the insurer as pure profit, however a percentage of these must be invested back into the Medicare Advantage plan as increased (better) benefits or lower monthly premiums. That’s good for you, the consumer as this essentially makes these products more attractive. Makes sense, right? Higher star ratings generally means better benefits and lower premiums which attracts more customers.

If a MAPD or Prescription Drug Plan (PDP) achieves 5-star status in any given year, the real “win” for that company is that they can enroll members year-round, while other insurance companies can only do so during the Annual Election Period (AEP) which runs from October 15 through December 7. Essentially, achieving five stars gives the plan a huge sales and marketing advantage over their competitors.

The Medicare Advantage (MAPD) landscape across the county is largely occupied by big insurance companies like United Healthcare (AARP brand) Blue Cross and Blue Shield, Humana, Cigna and Aetna. However, there are many smaller companies who also offer MAPD plans for sale that are regional in nature. Historically, it’s the smaller companies that have been awarded high star ratings, and that trend continues for 2017.

The Large Insurers – Star Ratings Performance

#1. Let’s start with Aetna, which also operates as Coventry in many states. Looks like they were the big winner this year among the large insurance companies. For 2017, 91 percent of the insurer’s MA members will be in four-star or higher Medicare Advantage and prescription drug (MA-PD) plans. Aetna recently noted it has the highest percentage of Medicare members enrolled in four-star plans among publicly traded companies. No Aetna plans achieved a 5 star rating for 2017.

#2. Anthem, the parent company of many Blue Cross and Blue Shield plans said nearly 51 percent of their Medicare Advantage members will be enrolled in plans that achieved four stars or higher and approximately 22 percent of members enrolled in plans that achieved four stars or higher in 2016. So while the overall number of members in a highly-rated plan is high, no Anthem plans achieved a 5 star rating for 2017.

#3. United Healthcare/AARP hasn’t sent out a press release, and didn’t address their Star Ratings in their latest earnings call. However a quick review of their plans shows they achieved one 5 star rating in an HMO that serves several Texas markets.

4. Cigna and Humana (which are in the middle of merger discussions) saw a reduction in its ratings, as next year only 20 percent of its MA customers will be in plans with four stars or higher. To throw gas onto the fire, Cigna is still on a government-imposed sales and marketing ban and isn’t expected to be allowed to enroll new members into their Medicare Advantage and PDP plans until early 2017.

Smaller Insurance Companies Perform Better…Again

CMS announcement of the 2017 Medicare star quality ratings, Kaiser Permanente’s Northern and Southern California, Colorado, Northwest and Mid-Atlantic States regions received 5 out of 5 stars each, the highest overall rating. Kaiser Permanente’s Georgia and Hawaii regions earned 4.5 out of 5 stars.

In fact, you won’t find any “household name” companies other than Kaiser and the one United Healthcare plan achieved 5 stars this year.

Overall MAPD and PDP Quality Improving

According to CMS, approximately 49 percent of MAPDs in 2017 earned four stars or higher, which is up slightly from 2015.

Overall, CMS said nearly 70 percent of Medicare Advantage enrollees will still be in plans that receive at least four stars for quality in 2017.
Just over half of private Medicare customers signed up for plans that received at least four stars in 2014. But the new figure is down slightly from this year, when just over 70 percent of the 17 million-plus Medicare Advantage customers enrolled in the high-quality plans.

There has been similar improvement in quality ratings for prescription drug plans. Just over 40 percent of Medicare beneficiaries who enroll in stand-alone prescription drug plans are expected to be in plans with at least four stars next year. That’s up from just 9 percent who were enrolled in such high-performing plans in 2014.

2017 MAPD 5-Star Rated Plans

KelseyCare Plan Administrators
Enrollment: 30,769
State: Texas

Kaiser Foundation Health Plan
Enrollment: 1,086,961
State: California

Kaiser Foundation Health Plan of Colorado
Enrollment: 104,117
State: Colorado

Kaiser Foundation of the Mid-Atlantic States
Enrollment: 68,575
States: District of Columbia, 11 counties in Maryland, 9 counties in Virginia

Tufts Associated Health Maintenance Organization
Enrollment: 107,311
State: Massachusetts

Blue Cross Blue Shield of Massachusetts HMO Blue
Enrollment: 10,302
State: Massachusetts

Group Health Plan
Enrollment: 53,633
States: Minnesota, Wisconsin

United Healthcare AARP Medicare Complete Plan 1
Enrollment: 31,035
State: Texas

Physicians Health Choice of Texas
Enrollment: 31,035
State: Texas

Capital District Physicians’ Health Plan Universal Benefits
Enrollment: 3,827
State: New York

Gundersen Health Plan
Enrollment: 14,462
States: Iowa, Wisconsin

Optimum HealthCare
Enrollment: 45,153
State: Florida

Kaiser Foundation Health Plan of the Northwest
Enrollment: 84,567
States: Oregon, Washington

The Takeaway:

Almost 18.5 million individuals will be enrolled in private Medicare Advantage plans next year, representing about one-third of all beneficiaries. The higher the Star Rating, the more money the insurance company receives from CMS. A portion of that bonus money must be spent on better benefits and lower premiums, which is good for you and your wallet. If you are lucky enough to live in an area boasting a 5-star plan in 2017, you may enroll in those plans anytime during the year; you don’t have to wait until the next AEP.

Medicare Premiums Going up, Benefits Going down in 2017

Today, the Centers for Medicare & Medicaid Services (CMS) announced the 2017 premiums for the Medicare inpatient hospital (Part A) and physician and outpatient hospital services (Part B) programs.

And guess what?  They’re going up.  Especially if you’re rich. Not even rich, really.  Just better off than most.  Funny how the timing of this happens right after the Presidential election, hmm?

The “average” Medicare Part B premium will be about $109.00, compared to $104.90 for the past four years.  That’s for about 65% of the Medicare population.  The standard monthly premium for Medicare Part B will be $134.00 for the other 30% in 2017, which is a 10 percent increase from the 2016 premium of $121.80.

The above changes do not affect your Medicare Advantage monthly premiums but they may impact you if you’re on a Medicare Supplement plan that covers either the Part A and/or the Part B deductibles.  More about deductible increases later in the post.

Higher Income?  Higher Premiums for You!

If you did the quick math above, you’ll notice we have 5% of the population left to talk about.  These 5% pay much higher costs for the exact same Medicare coverage.

Since 2007, people with higher incomes have to pay higher Medicare Part B monthly premiums. I covered this pretty extensively in a post you can read by clicking here.  These income-related monthly premium rates affect roughly 5% of people with Medicare.

Individuals earning between $85,001 and $107,000 and couples earning between $170,001 and $214,000 will see their monthly premiums rise from $170.50 a person this year to about $187.50 in 2017. For those earning more than $214,000, or $428,000 for couples, the increase is to $428.60 a month, from $389.80 in 2016.

Medicare Deductibles Increase in 2017

The Medicare Part A inpatient hospital deductible that beneficiaries pay when admitted to the hospital will be $1,316 per benefit period in 2017, an increase of $28 from $1,288 in 2016.

If that wasn’t enough, CMS also announced that the annual deductible for all Medicare Part B beneficiaries will be increasing to $183 in 2017 (compared to $166 in 2016).

 More Bad News – Your Social Security Check

In 2017, Social Security benefits will rise a lousy 0.3%. Social Security says the cost-of-living adjustment will add $5 to the average monthly payment for all retired workers. This means that whopping $5 won’t cover the increase in your Medicare Part B premium, so your checks will actually be getting a bit smaller this year.

The Takeaway:

Not much you can do about this, really.  If you’re on a Medicare Advantage plan, these increases will not affect your plans, at least in 2017.  However if you’re on a Medicare Supplement plan (Medigap), your insurance company has been waiting on this announcement for some time.  That’s because they have to set their 2017 Medicare Supplement pricing, and increasing Part A and/or Part B deductibles means they’ll have to pay more out in claims.  More paid claims equals higher policy premiums.  Keep an eye on your Medicare Supplement renewal premiums when you get them in the mail… most carriers send them out in the first three months of the year.  An annual increase larger than 5-9% may mean it’s time to shop for a Medicare Advantage plan.  You can check out my post on those types of plans by clicking here.

 

Medicare Sales Scope of Appointment

Medicare’s Annual Election Period (AEP) is just days away. This is a very busy time for insurance sales agents, who are filling their calendars with sales appointments. But before they can sell you a plan, they must secure Scope of Appointment documents from YOU, the consumer.

If you call an insurance company or an insurance agency and request to meet with an agent, they’ll typically offer an appointment in your home, or at a library or coffee shop. But before you meet with a sales agent to discuss your plan options, every one of them will require you to fill out a Scope of Appointment.

The Scope of the Appointment outlines what you specifically want to discuss at the appointment whether it is a Part D plan, a Medicare Advantage Plan, or a Medigap plan. The agent is not allowed to talk to you about products that are not included in the scope of the appointment.
When the agent presents you the Scope of Appointment, typically they’ll want you to agree to discuss ALL plan options, which is usually a good idea. That’s because if you think you’re in the market for an MAPD plan, but it turns out you want a Medicare Supplement (Medigap), there’s a problem.  If you didn’t fill out the Scope of Appointment form to ‘OK’ talking about a Medigap plan, then the agent cannot talk to you about it.

Scope of Appointment Not Always Required

The Scope of Appointment form is not required during sales and marketing seminars. So, if you get invited to and attend a seminar to listen to Medicare options, and decide to buy a product at the end of the seminar, you won’t need one.

Scope of Appointment forms often differ from one health insurance plan to another. The form usually indicates the sales agent does not work for the federal government and may benefit from the sale of the health product (will receive a commission).
The forms also bear the notice that signing the appointment form is not a binding agreement to enroll in any plan. The form does not affect your current or future enrollment status in any Medicare plan.

By law, it is not possible for any insurance sales agent to proceed with an in-person appointment unless the beneficiary or the person seeking information on their behalf has signed and submitted the form to the agent.
During the in-person appointment, the following are the actions that the sales agent is legally allowed to make:
1) They can discuss various plan options with you
2) They can distribute plan materials, including the enrollment kit for the insurance product
3) They can distribute or collect enrollment forms
4) They can advise on how to get plan information, for example through mail, a website or customer service
5) They can also provide educational content

However, the sales agent cannot market non-healthcare related products until at least 48 hours after the original appointment.

The Takeaway:

The Medicare Scope of Appointment is a form you must fill out before an insurance agent can discuss plan options with you.  It’s best to fill it out completely, marking all of the Medicare plan options you may wish to discuss.

Medicare Advantage Star Ratings and Your Wallet

Assigning Medicare Star ratings to Medicare Advantage plans is attempt by the government to neatly rate the quality of a Medicare Advantage (MAPD) plan.   Like most attempts to aggregate lots of information into a small rating system for easy public consumption, it’s flawed. Plan Star ratings should be one aspect of your Medicare insurance coverage decision.  However, it shouldn’t overshadow other considerations like price, network, MOOP or your prescription drug coverage.  Star ratings are important to you, because ultimately if your plan is rated 3 stars or below, it generally means you’ll pay more money for your policy or your benefits won’t be as rich as plans with 4 Stars or higher.    

The Centers for Medicare and Medicaid (CMS)  established a five star rating system in order to help consumers identify and educate the consumer as to the overall quality of their Medicare Advantage (MAPD) Prescription Drug Plan (PDP) plans.  

The star rating system is numbered from 1 to 5, with 5 being the best and 1 being lowest in terms of quality of service:

5 Stars- Excellent

4 Stars- Above Average

3 Stars- Average

2 Stars- Below Average

1 Star- Poor

Medicare Advantage Star Ratings

Medicare Advantage (MAPD) health plans are rated based on the following categories:

1) Staying healthy: screenings, tests and vaccines. CMS evaluates whether members of a particular health plan got various screening tests and vaccines and whether they got other check-ups that would go a long way in keeping them healthy.

2) The management of chronic conditions: individual health plans are graded on their ability to ensure that members with long term conditions got tests and treatments that helped in managing their chronic conditions.

3) The experience of beneficiaries with the plan: the CMS routinely surveys members to elicit their experiences with different health plans, and this is factored into the STAR rating that each health plan will get.

4) Members’ complaints: beneficiaries under a certain plan can lodge complaints if they encounter problems when using their plan. Medicare also routinely evaluates the health plan of the private insurance company to plot the plan’s performance and improvement over time.

5) Customer service: this includes how often members with appeals and other problems are handled by the health plan’s customer service.

Medicare Stars Rating Flawed?

I mentioned above the ratings system is flawed. I say that, because every year, CMS changes the rules and how they score health plans.  Think about it:  There are over 54 million people on Medicare.  Can you really break down plan ratings across the country in only one way?  Can you really break down these ratings into a neat 5 star sliding scale?  The obvious answer is no, and policy professionals and insurance companies quietly (and sometimes not so quietly) let CMS know about it.  Differences in geography, access to hospitals and doctors, income and even attitudes about what it means to be healthy mean the results are suspect and imperfect.

I won’t spend any more time here on the flaws, as plenty of people smarter than me have already done so.  If you’re a policy wonk and would like to check those out, you can click here, here, or here.


Medicare Advantage Star Ratings Affect Your Wallet

Here’s what it means for you, the consumer.  In a nutshell, when you join a Medicare Advantage plan the federal government (CMS)  pays insurance companies a set dollar amount for your care every month.  Plans rated 4 Stars or higher get more money from the government for everyone enrolled in the plan.  This money really adds up, quickly.  Let’s say there are 10,000 people enrolled in the same MAPD plan.  And let’s say, for the sake of argument, that insurance company gets $1,000 per month, on average, from the government for every person’s medical and prescription drug care.  That’s $10 Million dollars per month, or $120 Million dollars per year.  Yes, that’s a big number, but remember the Medicare Advantage plan is on the hook for all the medical and prescription drug care (from the healthy to the very ill) of those 10,000 members.

So, let’s say the plan achieves a Star Rating of 4 Stars.  The insurance company will earn an additional 5% on top of the $1000 they get for all 10,000 people on that same plan.  Quick math means that’s an additional $500,000 every month MORE that insurance company makes, and $6 Million dollars more a year.  Some of that can be profit for the insurance company, but the government mandates a portion of this money MUST be spent on making the Medicare Advantage plan’s benefits better.  That’s where your pocketbook comes in.

Since Medicare Advantage plans need to take a portion of that additional 5% and put it back into the actual insurance plan, they usually do so in two ways.

  1. Lower the plan’s monthly premium
  2. Make benefits richer.  (Ex. Lowering doctor’s copay from $10 to $5, lowering hospital copays, etc.)

Medicare Advantage plans get a Star rating every year.  So if you think about it, if you’re in a 3 Star plan instead of a 4 star plan over the course of 5 years, and those Star ratings remain the same all 5 years, you’re missing out.  Why?  Because remember, a portion of the money the 4 Star plan gets over those 5 years MUST be put back into lower premiums or better benefits.  After 5 years, the Medicare Advantage plan rated 4 Stars should essentially, be cheaper (both in premium or by having better benefits) than the 3 Star plan will.

The Takeaway

Do Star ratings really matter?  Sure.  They matter because they give an overall indication as to the quality and customer experience of a given Medicare Advantage plan.  Is there a significant difference between a 3 Star plan and a 4 Star plan, from the consumer’s standpoint or experience?  No.  There are flaws, to be sure and the “rules” insurance companies must abide by change every year.  The real impact to YOU, the CONSUMER is that higher-performing MAPD plans that receive 4 Stars or higher are paid more from the federal government.  Half (or more) of that additional money MUST be put back into benefits or lower insurance policy premiums, which in the long run, is better for you and you wallet.  

Medicare Supplement: What’s the Difference Between Plan C and F?

Medicare Supplement plans have been around for ages, and the most popular plans by far are Plan C and Plan F.  So, what’s the difference?  Not much. In fact, the only thing Medigap plan Plan C does not cover is Medicare Part B excess charges, which Medigap plan F does.  Is it a big deal?  Not really.

Medicare Part A covers hospital stays and Part B covers outpatient services while Part D covers prescription drugs. As you know by now, Original Medicare still leaves gaps in your healthcare coverage.  Medicare supplemental insurance (Medigap) fills in these gaps.  Some plans fill in most of the gaps, others fill in ALL of the gaps.  Medigap plans F and C fill in all of the gaps, hence their popularity.  Unlike Medicare Advantage plans, you don’t need to worry about an HMO or a PPO network when you buy a Medigap policy.   When you buy a Medigap policy, Original Medicare will pay its Medicare-approved amount first, and the Medigap policy will then pay its part. Depending on the plan, this may leave a balance for you to pay.

Medicare Supplement = Medigap

Medicare Supplement insurance policies are also known as Medigap policies. These Medigap policies are important due to the fact that they may take care of other costs Original Medicare coverage will not cover. These include costs such as: co-payments, coinsurance and deductibles. Some Medigap policies also go the extra mile and pay for care when you travel outside the country. If you travel a lot, you need to check out my post on this subject by clicking here.

There are many different Medigap plans, ranging from plan A to plan N. Two of the most popular plans are Medigap Plan C and Medigap Plan F. Both of these plans cover 100% of what Medicare doesn’t cover.  Out of all the supplement plans available, only Plan F is more comprehensive than Plan C.

You Need a Medigap or Medicare Advantage Plan

As you by now know going “Bare with Medicare” is an OK option, but not advisable under most scenarios, mostly due to the lack of a, “Maximum Out Of Pocket,” or MOOP.  Click here to see my post outlining why a Medicare Supplement needs to be a part of your health insurance coverage if you don’t want to choose a Medicare Advantage plan.

The Takeaway

The only thing that Medigap plan Plan C does not cover is Medicare Part B excess charges.  Plan F DOES cover Part B excess charges. These are the fees that a doctor is legally to charge over and above the amount approved by Medicare as payment for a health service at a physician’s office IF THEY DON’T ACCEPT MEDICARE ASSIGNMENT.  Usually, when these charges occur, it is up to the patient to pay for them out of pocket.  I wrote a blog post about Medicare excess charges and Plan F.  You can read that by clicking here.

Over 99% of doctors and hospitals across the country accept Medicare Assignment. The doctors and hospitals that don’t are usually specialty cancer centers or research institutions.  Medigap Plan F covers these excess charges.  Medigap Plan C does not.   So if Medicare Supplement plan C is substantially less expensive than Medicare Supplement plan F, I’d go ahead and choose C.  If the monthly premiums are within $10, I’d stick with Plan F.

It is also important to note that Plan F offers a high deductible plan. HD-F has a pretty substantial deductible you must pay before it kicks in.  But when it does, the same features of the regular Medigap plan F kicks in, including coverage of the Medicare excess charges.  Check out my comparison of HD-F and Medigap F by clicking here.