(taken from the April 2011 AARP Bulletin)
The Medicare program has separate rules for people in different situations and a range of choices that require everyone to make personal and timely enrollment decisions. From time to time over Medicare’s 45 year history, Congress has added more benefits and options, each with its own new set of rules. Although every piece has an inner logic, Medicare now resembles a crazy quilt that bewilders many enrollees – but it still gives the comfort of guaranteed health coverage to more than 46.5 million Americans.
What it covers:
Part A helps pay the costs of a stay in a hospital or skilled nursing facility, home health care, hospice care, and medicines administered to in patients. There is no premium for Part A if you paid enough in Medicare taxes while working. Part A has a deductible ($1,132 in 2011) for hospital stays.
Part B helps pay bills for physicians and outpatient services such as rehab therapy, lab tests and medical equipment. It also covers doctors’ services in the hospital and most medicines administered in a doctor’s office. Part B requires a monthly premium - at the standard rate of $115.40 a month if you join Medicare in 2011 (this rate usually changes annually). You pay an annual deductible for Part B ($162 in 2011) before coverage kicks in.
Part C is a different way you can choose to receive your Medicare benefits. It consists of a variety of private health plans, known as Medicare Advantage plans, that cover Part A, Part B and (often) Part D services in one package.
Part D helps pay the cost of prescription drugs that you use at home, plus insulin supplies and some vaccines. To get this coverage, you must enroll in a private Part D drug plan or in a Medicare Advantage plan that includes Part D drugs. Part D drug plans charge additional premiums, and so do most Medicare Advantage plans. You pay an annual deductible for Part D ($310 in 2011) before coverage kicks in. Some Part D and Medicare Advantage plans reduce or waive deductibles. Part D drug coverage. Part D drug coverage is uniquely designed. You pay your plan’s deductible and copays until the total cost of the drugs you’ve used since the start of the year reaches a certain level ($2,840 in 2011). Beyond that, you’re in a gap known as the “doughnut hole.” You plan then pays nothing (unless it provides some coverage in the gap), but now you get a 50 percent discount on brand-name drugs from the manufacturers. This discount was established under the new health care law, which also will gradually reduce your costs every year, until by 2020 you’ll pay no more than 25 per cent of the price of any drug in the doughnut hole. If the full cost of the drugs in the gap, plus what you’ve paid out on deductibles and copays before the gap, reaches a certain limit ($4,550 in 2011), the coverage resumes and you pay no more than 5 percent of the cost of any drug until the end of the year.
(You pay higher premiums for Parts B and D if your modified adjusted gross income on your latest tax return is above $85,000 (if you are single) or $170,000 (if married and filing joint returns).
Almost everyone in Medicare has access to at least one MA plan, and in many areas there are dozens with its own mix of costs, benefits and conditions. Your mailbox may be stuffed with their ads. But to compare plans objectively and free of sales pressure, use the official Medicare website, which lists details of every plan in your area, including a measure of the quality of its care – or call the Medicare help line (1-800-633-4227) for assistance. You can enroll in the plan you choose through Medicare or directly through the insurance company.
If you need to add prescription drug coverage to traditional Medicare, you will also be faced with dozens of different plans. You can compare them in the same way you compare Medicare Advantage plans. If you don’t currently take any drugs, you may want to choose the plan with the lowest premium to get coverage at the least cost. Otherwise, it’s best to choose a plan according to the specific drugs you take, because plans charge widely varying copays even for the same drug. The plan finder on Medicare’s website automatically does the math to find your best deal. (AARP has created a guide on the AARP website to help you work your way through the process.) You can enroll through Medicare or directly with the plan.
Nobody is obligated to sign up for Medicare. But there are important consequences if you don’t meet your enrollment deadline and then decide to join the program.
To enroll to sign up for Par A or B, call Social Security at 1-800-772-1213 and make an appointment for an interview, which can be done on the phone or at your local Social Security office.
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The Massachusetts Executive Office of Elder Affairs SHINE (Serving the Health Information Needs of Elders) Program provides free and confidential health insurance information, education, counseling and assistance to Massachusetts Medicare beneficiaries of all ages, their family and other caregivers.
SHINE counselors are volunteers trained and certified by the Massachusetts Executive Office of Elder Affairs training staff in many areas of health insurance including the original Medicare Plan, Medicare Advantage Plans, Medicare Prescription Drug Coverage, Medicare Rights and Protections, Prescription Advantage (the Massachusetts Sate Prescription Assistance Program), MassHealth and other programs for people with limited income and resources, and other Medicare, government and private health plans.
Call the Peabody Council on Aging at 978-531-2254 to book an appointment with one of our three SHINE counselors: Sheila Dzengelewski, Maryanne Pierce or Sandra Cloutman.