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Medicare Supplement Insurance Guide (2004)

Standard Medicare Supplement Benefits

Medicare Supplement insurance can be sold in only ten standardized plans. The chart below shows the benefits included in each plan. 

Basic Benefits are included in all plans. They include:

  Medicare Part A coinsurance plus coverage for 365 additional days during your lifetime after Medicare benefits end;

  Medicare Part B coinsurance;

  the first three pints of blood or equal amounts of packed red blood cells per calendar year, unless this blood is replaced.

A

B

C

D

E

F*

G

H

I

J*

Basic Benefits

Basic Benefits

Basic Benefits

Basic Benefits

Basic Benefits

Basic Benefits

Basic Benefits

Basic Benefits

Basic Benefits

Basic Benefits

 

 

Skilled Nursing Coinsurance

Skilled Nursing Coinsurance

Skilled Nursing Coinsurance

Skilled Nursing Coinsurance

Skilled Nursing Coinsurance

Skilled Nursing Coinsurance

Skilled Nursing Coinsurance

Skilled Nursing Coinsurance

 

Part A Deductible

Part A Deductible

Part A Deductible

Part A Deductible

Part A Deductible

Part A Deductible

Part A Deductible

Part A Deductible

Part A Deductible

 

 

Part B Deductible

 

 

Part B Deductible

 

 

 

Part B Deductible

 

 

 

 

 

Part B Excess (100%)

Part B Excess (80%)

 

Part B Excess (100%)

Part B Excess (100%)

 

 

Foreign Travel Emergency

Foreign Travel Emergency

Foreign Travel Emergency

Foreign Travel Emergency

Foreign Travel Emergency

Foreign Travel Emergency

Foreign Travel Emergency

Foreign Travel Emergency

 

 

 

At-Home Recovery

 

 

At-Home Recovery

 

At-Home Recovery

At-Home Recovery

 

 

 

 

 

 

 

Basic Drug Benefit ($1,250 Limit)

Basic Drug Benefit ($1,250 Limit)

Extended Drug Benefit ($3,000 Limit)

 

 

 

 

Preventive Care

 

 

 

 

Preventive Care

            * Plan F and Plan J also have high deductible options, some companies may offer these options.

Standard Medicare Supplement Benefits

The basic benefits (also known as the "core benefits" or Plan A) are the minimum coverage you may buy. Plan A contains only the three core benefits listed below. Every other plan contains these three benefits as the "core" and then adds one or more additional benefits. Although Plan A is the least expensive policy, it may not be a good choice for low-income individuals who may not be able to afford the Medicare Part A hospital deductible when they are hospitalized.

1.      Hospitalization: Medicare Part A pays only a portion of the daily costs for hospitalizations.  You must pay the coinsurance amounts for those days.  This Medicare Supplement benefit pays the Part A coinsurance amount after the 60th day and an additional cost of 365 lifetime days.

2.      Blood: Medicare pays for all blood that is medically necessary except for the first three pints in each calendar year. This Medicare Supplement benefit pays for the first three pints of blood not paid for by Medicare, or equivalent quantities of packed red blood cells, as defined under federal regulations.

3.      Medical Expenses: Generally Medicare Part B pays for 80% of a predetermined amount (called the "Medicare approved" amount) for each procedure, supply, or service billed by your doctor or other provider that is not a hospital. This Medicare Supplement benefit pays the coinsurance generally (20% of the "Medicare approved" amount) under Medicare Part B.

There are eight additional benefits that are combined with the basic benefits in various ways to make up the nine remaining plans called Plan B through Plan J.

1.      The Part A Deductible: The Medicare Part A deductible is the expense for which you are obligated to pay when you are admitted to a hospital as an inpatient. Medicare pays eligible benefits above that amount. (The Medicare Part A deductible amount may change yearly, so check the current handbook). This Medicare Supplement benefit reimburses you the deductible amount, no matter what the amount may be. This benefit is included in Plans B through J.

2.      Skilled Nursing Coinsurance: Medicare Part A pays for the first 20 days of care in a skilled nursing facility following hospitalization, but requires you to pay a coinsurance beginning on the 21st day through the 100th day. This Medicare Supplement benefit pays the coinsurance amount beginning on the 21st day. This benefit is included in Plans C through J.

3.      Part B Deductible: The Medicare Part B deductible is the amount you must pay each year for medical expenses (such as doctor fees) before Medicare begins paying. (The Part B deductible amount may change per year). This Medicare Supplement benefit reimburses you the deductible amount. This benefit is included in Plan C, Plan F, and Plan J.

4.      Part B Excess Charges: Medicare Part B pays 80% of a predetermined amount (called the "Medicare approved" amount) for each procedure performed by your doctor or other medical care provider. If your doctor accepts Medicare "assignment", the provider may only bill you for the difference between the amount paid by Medicare and the amount approved by Medicare.

If your doctors do not accept Medicare assignment, they may bill you for the difference between the amount paid by Medicare and the amount they can legally charge you (called the "limiting charge"). If you have a Medicare Supplement Policy with the following:

        Part B Excess Charges (100%) benefit, the policy will pay the full amount billed by your doctors or other providers who do not take Medicare assignment subject to the limiting charge. This benefit is included in Plan F, Plan I, and Plan J.
 

        The Part B Excess Charge (80%) benefit, the policy will pay 80% of the amount you are billed by your doctors or other providers. This benefit is only in Plan G. Theoretically, you should save money on premium costs if you select the 80% benefit rather than the 100% benefit. Remember that this coinsurance amount is paid by the Medical Expenses part of the Basic Benefits that are part of every Medicare Supplement insurance policy. All policies sold today must pay 50% coinsurance for outpatient mental health treatment services.

5.      Foreign Travel Emergency: The original Medicare plan does not pay for medical care outside of the United States, but some Medicare managed care plans, private fee-for-service plans, and some Medicare Supplement plans do. This Medicare Supplement benefit will pay 80% of your expenses for most emergency medical care in a foreign country during the first 60 days of a trip abroad after you pay a $250 deductible. There is a lifetime maximum benefit, so check your current handbook for the dollar amount. This benefit is in Plan C through Plan J. Check your insurance coverage before you travel.

6.      At-Home Recovery: Under the home health care benefit, Medicare pays for intermittent visits by a nurse or other skilled care provider in your home during recovery from an acute illness. Medicare does not pay for custodial care in your home such as homemaker services, ( i.e. help with bathing, dressing, laundry, or shopping). This Medicare Supplement benefit pays per home visit. Check your handbook for current benefits for medically necessary custodial care while you are recovering from an illness, injury, or surgery. An insurance company may limit the number of visits to equal the number of Medicare home health care visits. This benefit is in Plan D, Plan G, Plan I, and Plan J.

7.      Basic Prescription Drug Benefit: Until January 1, 2006 this benefit has an annual limit of $1,250.  The extended prescription drug benefit has an annual limit of $3,000.  Medicare does not generally pay for outpatient prescription drugs.  Each of these Medicare Supplement benefits pays 50% of the cost for outpatient prescription drugs to a maximum of $1,250 or $3,000 per year depending on the plan you purchase.  The basic drug benefit is in Plan H and Plan I.  The extended drug benefit is in Plan J only. Starting January 1, 2006 plans H, I, and J may be sold without the prescription drug benefit.

8.      Preventive Care: Medicare pays for some testing for diagnostic purposes. This Medicare Supplement benefit pays up to $120 per year for certain tests done for screening purposes, routine physical exams, patient education, and other medically appropriate tests or preventive measures not covered by Medicare. This benefit is included in Plan E and Plan J.

Revised – September 13, 2004

  

 

Medicare

 The following information was prepared as an example using the specific details listed below:

 

Date of Birth: 1/1/1950
Type of Medicare Coverage: Not Enrolled
Do you have Medicaid: No
Are you living outside of the U.S.: No
Are you receiving health benefits from employer: Yes
Do you have a disability: 
No

The following table contains an eligibility assessment and enrollment status based on the information listed above. Please note that the Social Security Administration will make the final decision on your eligibility and enrollment status.

General Enrollment

You would be eligible for Medicare Part A and B on December 1, 2014. If you were not receiving retirement benefits from Social Security or the Railroad Retirement Board, and you want Medicare Part B to begin at age 65, you would need to apply for Medicare during the three-month period before turning 65. If you applied the month you turn age 65 or later, your Medicare Part B start date will be delayed. To apply please visit or call your local Social Security office or call the Social Security Administration at 1-800-772-1213. Medicare Part A helps cover your inpatient care in hospitals, critical access hospitals and skilled nursing facilities. It also covers hospice care and some home health care. Medicare Part B helps cover your doctors’ services, outpatient hospital care, and some other medical services that Medicare Part A doesn’t cover, such as some of the services of physical and occupational therapists, and some home health care. Medicare Part B helps pay for these covered services and supplies when they are medically necessary. For more coverage information go to Your Medicare Coverage.

Note: You would be eligible for Medicare when you turn 65 even if you were not eligible for Social Security retirement benefits. For more information, please visit our retirement age FAQ.

Part A Specific

Most people don’t have to pay for Medicare Part A. You don't have to pay for Medicare Part A if you have worked for at least 10 years in Medicare-covered employment. If you do not meet this requirement, you may have to pay a premium for Part A. Please call the Social Security Administration at 1-800-772-1213, or contact your local Social Security office to apply.

Part B Specific

Just before you turn 65 years old, you have to decide whether or not to enroll in Medicare Part B. You can sign up for Medicare Part B during your Initial Enrollment Period. Your Initial Enrollment Period would begin September 1, 2014 and lasts until March 31, 2015. If you enrolled during the first three months of your Initial Enrollment Period, your Part B coverage will start on December 1, 2014. If you wait until you are 65, or sign up during the last three months of your Initial Enrollment Period, your Part B start date will be delayed and your coverage will start one to three months after you enroll. Most people pay monthly for Medicare Part B. The premium for Medicare Part B is $78.20 in 2005. This monthly premium is deducted from your Social Security, Railroad Retirement, or Civil Service Retirement check. If you do not get any of these payments, Medicare will either send you a bill for your Part B premium every 3 months or you can use Medicare Easy Pay as an electronic payment option. This payment option allows people with Medicare to have their Medicare premiums automatically deducted from either their savings or checking account free of charge. For more information on how to sign up, go to the Medicare Easy Pay FAQ.

If you choose not to sign up for Medicare Part B during your Initial Enrollment Period because you have health insurance through your current active employment, you may sign up during the Special Enrollment Period.

Special Enrollment Period

If you are still receiving health benefits from your (or your spouse's) current employer when you are first eligible for Medicare Part B, you have the option of enrolling in Medicare Part B at a later date. You can sign up for Part B during the Special Enrollment Period. Most people who sign up for Medicare Part B during a Special Enrollment Period don't pay higher premiums. If this applies to you, you can sign up for Medicare Part B:

  • Anytime you are still covered by an employer or union group health plan through your (or your spouse's) current or active employment, or
  • During the eight months following the month that the group health plan coverage or the employment ends (whichever is first).

If you enroll in Medicare Part B while covered by the group health plan or during the first full month after the coverage or employment ends (whichever is first), your Medicare Part B coverage starts on the first day of the month you enroll. You can also delay the start date for Medicare Part B until the first day of any of the following 3 months.

If you enroll during any of the 7 remaining months of the Special Enrollment Period, your Medicare Part B coverage starts the first day of the month after the month you enroll. Note: If you are still working and plan to keep your employer’s group health plan coverage, you should talk to your benefits administrator or your State Health Insurance Assistance Program to help you decide the best time to enroll in Medicare Part B. When you sign up for Medicare Part B, you automatically begin your Medigap (Medicare Supplement Insurance) open enrollment period. Once your Medigap open enrollment period begins, it cannot be changed or restarted. For more details about Medigap policies, please visit Medigap Policy Basics.

General Enrollment Period

If you do not enroll in Medicare Part B during your Initial Enrollment Period or your Special Enrollment Period, you may sign up during the General Enrollment Period. This period runs from January 1st through March 31st of each year. During this time, you can sign up for Medicare Part B by calling the Social Security Administration at 1-800-772-1213 or by visiting or calling your local Social Security office. Your Medicare Part B coverage will start on July 1st of the year you sign up. The cost of Medicare Part B will go up 10% for each 12-month period that you could have had Medicare Part B but didn't take it. You will have to pay this extra amount as long as you have Medicare Part B.

Note: When you sign up for Medicare Part B, you automatically begin your Medigap (Medicare Supplement Insurance) open enrollment period. Once your Medigap open enrollment period begins, it cannot be changed or restarted. For more details about Medigap policies, please visit Medigap Policy Basics.



Medicare website

 

2005 – CHOOSING A MEDIGAP POLICY

 

MEDICARE & YOU – 2005

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