Medicare Advantage of Medigap Plan

How do you know which type of plan is best for you?

The Medicare program, by itself, may not be so difficult to understand. But Medicare does not cover all medical services, and when it does, there are plenty of gaps in coverage, as well as substantial deductibles and copays you are responsible for. This is why private insurance companies offer plans for Medicare beneficiaries to protect them financially from losses due to what are called "out-of-pocket" expenses.

The Centers for Medicare and Medicaid Services (CMS) have put together several publications on the various choices available to you. The publications provide detailed information to help you understand the Medicare program (Medicare Parts A & B), Medicare Supplemental Insurance (Medigap plans), Medicare Advantage plans (Medicare Part C), and Medicare Prescription drug plans (Medicare Part D). If you need detailed information on any of these options, you can download a CMS publication at the end of this article, or call our office for personal assistance. This article is just a brief summary of your choices.

The Medicare program was designed to protect it's senior and disabled beneficiaries from financial hardship do to expensive hospital services (Part A) and medical services (Part B). For example, in 2010 there is a $1,100 deductible for hospital admissions under Medicare Part A during each benefit period. If a patient has not been in the hospital for 60 days after using one benefit period, then is admitted, a new benefit period begins, and an additional deductible of $1,100 and applicable coinsurance must be paid to the facility out of the beneficiaries pocket. Also in 2010, there is a $155 deductible for doctors services under Medicare Part B. Once the deductible has been met, Medicare will pay 80% of their "approved" rate.
Medicare does not provide any coverage when you are out of the Continental United States, except in limited situations, such as needing care in Canada, while on your way to Alaska, or if while in Texas and in need of emergency care, the closest hospital in located in Mexico. Verification will be require for these and any other exceptions.
Medicare pays for only one routine physical exam if performed during the first twelve months of your initial enrollment in Medicare Part B.
There are substantial daily copays for Skilled Nursing Care in a nursing home, with no coverage after a period of 100 consecutive days. Of course Custodial Care is not covered at all. The only type of insurance that will provide benefits for custodial care is Long-Term Care insurance (LTC).
There are no dental preventative care benefits, such as cleaning or exams.
There are no benefits for routine hearing or vision exams.

In 2010 the monthly premium for Medicare Part B continues to be $96.40 for beneficiaries who were already having their Part B premiums deducted from their Social Security checks. For those new to Medicare this year, the premium is $110.50 and for those making more than $85,000 in annual income, the rate is higher, ranging between $154.70 to $353.60
. This is list is not all inclusive, But you get the idea that there are some "gaps" in the Medicare programs coverage.

Medigap Plans

Medigap plans, sort of slang for" Medicare Supplemental Insurance" are designed to fill in many of the "gaps" in original Medicare.

When outside the Continental United States, Medigap plans will pay for medically necessary emergency care services beginning during the first 60 days of each trip outside the USA. You must first satisfy a $250 deductible, then the plan will pay 80% of covered expenses, up to a lifetime maximum of $50,000. (Best to purchase travel insurance)
Medigap plans will pay your Medicare Part A hospital deductible, and the Medicare Part A hospital copayments, for as long as Medicare would have paid. After Medicare would have stopped paying, Medigap will pay an additional 365 days. Once you have exhausted all these days, you pay 100% for any additional days. This payment schedule applies to each "benefit period". A benefit period begins on the first day you receive services as an inpatient in a hospital and ends after you have been out of the hospital and have not received skilled care in any other facility for 60 days in a row.
During the first 100 days in a skilled nursing facility, while receiving "skilled" nursing care, Medigap pays 100% of your covered expenses. After 100 days, or when "skilled" care is no longer required and documented, you pay 100%.
Medigap will pay your Medicare Part B annual deductible of $155. They will also pay the 20% for Part B medical services that Medicare does not pay for. Some Medigap plans will also pay any excess charges above the "Medicare Approved Amounts", should the provider not accept what Medicare approves. Providers who do not accept Medicare's approved payment amounts may, by Federal law, charge no more than 115% of the Medicare approved amount for services.
Medigap plans do not include Part D prescription drug coverage. If you choose a Medigap plan to supplement your Medicare Parts A & B, you will have to also enroll in a Medicare Part D plan. If you have "credible drug coverage" under an employer group plan, a group retiree or union plan, or receive your prescriptions from the Veterans Administration Health Care System, you will not get penalized for not enrolling in a Part D drug plan.
Medigap plans are "standardized", meaning that the government requires all plans of the same type (A through L) to pay the same benefits. The only element that can be different among Medigap plans of the same type is the monthly premium. Hence, paying more for a company name will not provide you with any additional benefits. The standardized plans are Plans A through L.

To see the coverage provided for each of the numbered plans, click here.

To see the current premiums charged for Connecticut residents, click here.

To learn more about Medicare Part D drug plans, click here.

Again, this list of covered benefits is not all inclusive. It is to give you a general idea of Medigap plan benefits and premiums.

Medicare Advantage Plans (Medicare Part C)

Medicare Advantage Plans are health plan options that are part of the Medicare program. If you join one of these plans, you generally get all your Medicare-covered health care through that plan. This coverage can include prescription drug coverage. Medicare Advantage Plans include:

Medicare Health Maintenance Organization (HMO's)
Preferred Provider Organizations (PPO)
Private Fee-for-Service Plans
Medicare Special Needs Plans

When you join a Medicare Advantage Plan, you use the health insurance card that you get from the plan for your health care. In most of these plans, generally there are extra benefits and lower copayments than in the Original Medicare Plan. However, you may have to see doctors and use hospitals that participate (accept) the plan to get services.

To join a Medicare Advantage Plan, you must have Medicare Part A and Part B. You will have to pay your monthly Medicare Part B premium to Medicare. In addition, you might have to pay a monthly premium to your Medicare Advantage Plan for the extra benefits that they offer.

Do to federal funding cuts to the Medicare Advantage plan subsidies, plans for 2010 may have increased their monthly premiums, increased deductibles or copays, or eliminated some "extra" benefits. Many Medicare Advantage plans will still offer dental benefits in 2010, though you may have to pay an additional premium for those services.

To see the coverage provided by Medicare Advantage plans in Connecticut, click here.

For help in understanding the plans, and which one may work for you, click here.

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For additional information on Medicare, Medigap, Medicare Advantage, or Medicare Part D drugs plans, Click on the below: Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.