Original Medicare and completing the Medicare puzzle

(Part 2 in series of seniors)

THE Original Medicare has Part A and Part B. Part A covers inpatient services like hospitalization. Part B covers outpatient services. In 2006, prescription drug coverage (Part D) was added to the program.

Not all 65 and older are eligible. The senior has to be in the U.S. for at least 5 years of continuous stay and with legal presence. People who are not yet 65 but have been receiving Social Security disability benefits for at least 24 months can also receive Medicare benefits. People who have ESRD can also get it with any age.

A senior may apply for Parts A and B 3 months before turning 65, up to 3 months after the birthday month, total of 7 months. The government may penalize him for not getting Part B or Part D as soon as he is first eligible to have them. A senior who still has affordable group health insurance may delay getting Part B up to 8 months after he lost his group health, still deemed first eligible and not penalized. However, the same senior only has 2 months after losing his group health to get his Part D to avoid penalty. To avoid confusion, penalty and insurance gap, the best advice would be to apply for the Part B in the last month with the group health and Part A, if not yet applied for when he turned 65. Then add Part D immediately as a stand-alone policy or as a bundled benefit of Part C, also known as Medicare Advantage.

Having just the Original Medicare card is not enough. It does not cover the cost-sharing like deductibles, co-pays and 20% co-insurances. It does not cover prescription drug. It does not have worldwide coverage.

One way to complete the Medicare puzzle is to add a Medicare Supplement plan (Medigap) from work or private insurance to defray these cost-sharing AND to add a Prescription Drug coverage (Part D). This means 2 more cards, total of 3 cards. These 2 additional cards have monthly premiums.

Medigap comes in several plans: Plan A, C, N, K, F, etc. Different insurance companies offer different plans. But all plans are standardized. For example, Plan F from different companies have uniform benefits. Most plans offer 365 more hospital days than Original Medicare. All these plans differ fundamentally in how much cost-sharing they cover and if worldwide coverage is included. In general, the more expensive plan covers more. Among the plans, Plan F covers the most. People who use plan F typically does not have any co-pay.

People who use Medigap can see any provider accepting Medicare without referrals. If this kind of plan is desired, one can get it any time of year. However, it’s better to apply when there’s a Guaranteed Issue condition that allows one to have it without having to pass the medical questions. For example, the first time when one is eligible to have Medicare, he will not have to go through the medical questions.

Part D plans vary according to premiums and formularies. To find out the most cost-effective plan, the list of medications has to be matched up with the Part D plans.

Another way to complete the puzzle is to have Medicare Advantage (Part C), formalized in 1997, serving all the benefits of Parts A and B, helping cover the cost-sharing, offering worldwide coverage and in most cases including the Part D, all-in-one card to show the providers and pharmacies. This 1 card may have $0 or more monthly premium.

Different Part C plans offer different benefits. They may include worldwide coverage, dental, vision, transportation services, etc. Part C can be PPO or HMO. But either way, people can only use doctors within the plan’s network. For HMOs, primary care doctors (PCPs) serve like the hub giving referrals to specialists and other providers.

Deciding on which Part C to use normally begins with checking if one’s PCP is within the network, the hospital list and if one’s drugs are covered.

People can get the Part C or Part D only when there’s an enrollment period that allows enrollment. When one is newly eligible to Medicare, he can get it. Or when he is coming out of the group health insurance. There are 2 groups of people though that may enroll and change Medicare plans anytime of the year: 1) they are people with certain chronic illness like cardiovascular disease, pulmonary problems, diabetes, mental illness, etc; 2) or they are people who are limited in resource qualified for the Social Security Extra Help or Medi-Cal.

For most people who don’t belong to the 2 groups of people mentioned above, they can enroll or switch every Oct 15 to Dec 7 of the year. This period is called Open Enrollment Enrollment.

They may change because they are after better benefits than what their current plan offers. Call 855-955-1800 for questions or go to a FREE seminar on related topic on Wed, Oct 12, 2016 10am – 12pm at the Monterey Park Bruggemeyer Central Library located at 318 S. Ramona Ave, Monterey Park, CA 91754. Another FREE seminar is available on Tue, Oct 18,  2016 1pm – 3pm at the Walnut Library located at 21155 La Puente Road, Walnut, CA 91789.

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If you have more questions regarding the enrollment periods or other insurance questions, feel free to ask the author for answers. A good telephone number to reach him is 855-955-1800. You can also check out www.GlobalWealthInsuranceServices.com.

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