Medicare is a federal health insurance program that pays a large part of the medical expenses for most Americans 65 and older and some younger disabled persons who have received federal disability benefits for at least 24 months.
Individuals with ESRD (End-Stage Renal Disease) or ALS (Amyotrophic Lateral Sclerosis, or “Lou Gehrig’s Disease”) may qualify for Medicare without the 24-month requirement.
When people get Medicare coverage there are two paths most people can take to utilize their benefits. Beneficiaries will either choose Original Medicare OR a Medicare Advantage Plan. There is an Annual Open Enrollment Period to switch which path an individual is on should it be decided later the individual wants a different coverage option.
The Original Medicare path consists of Part A: Hospital Insurance plus Part B: Medical Insurance. One can go to any doctor or hospital that takes Medicare anywhere in the U.S., and in most cases, the plan does not require referrals.
Out-of-pocket costs vary depending on usage and how the individual sets up coverage. Original Medicare has no limit on the individual’s out-of-pocket costs for health services. This is one reason some individuals choose to add a supplement to help with costs OR choose a Medicare Advantage plan that typically has a maximum the client pays for health services.
Original Medicare enrollees can also choose to add optional Part D: Prescription Drug Coverage.
There may be late enrollment penalties for Parts A, B, and D for beneficiaries who do not enroll when initially eligible. Thus, it is important for individuals to understand the coverage options and when to apply.
Original Medicare enrollees can also choose to add optional Medigap (Supplemental) insurance. Medigap insurance is not required and there are no late enrollment penalties. However, other restrictions and rate increases may apply especially if the policy is not purchased within the beneficiary’s initial enrollment period.
When beneficiaries take the Medicare Advantage Plan path, also known as Part C, the separate parts of Original Medicare (Parts A & B, and usually D) are “bundled” and overseen by a private insurance company.
Plans may have lower out-of-pocket costs than Original Medicare (depending on coverage and services needed). In many cases, beneficiaries need to use doctors who are in the plan’s network, and some plans may require referrals. Most plans offer “extra” benefits that Original Medicare does not offer.
For reliable information about obtaining desired Medicare benefits or plan comparisons, contact Affordable Medicine Options for Seniors (AMOS) or Tennessee State Health Insurance Assistance Program (SHIP).
Help with Medicare Costs
Help is available for low-income enrollees who cannot afford to pay Medicare premiums, copayments, or deductibles. To find out more about Qualified Medicare Beneficiary (QMB), Specified Low-Income Medicare Beneficiary (SLMB), Qualifying Individuals (QI1), Qualified Disabled Working Individuals (QDWI), and Low-Income Subsidy (LIS or Extra Help) programs, see pages 127-129. The income and resource limits for the Medicare Savings (QMB, SLMB, QI1, QDWI) and Extra Help programs change yearly. Call Affordable Medicine Options for Seniors (AMOS) at 865-524-2786 or Tennessee State Health Insurance Assistance Program (SHIP) 1-877-801- 0044 for current limits.
When to Apply for Medicare
Generally, to apply for Medicare benefits, one should contact Social Security three months before turning 65. If a beneficiary does not sign up at that time, there may be delayed coverage. Failure to sign up during the 7-month Initial Enrollment Period (3 months before the month one turns 65, the month one turns 65, and 3 months after the month one turns 65) may lead to late penalties when an individual does enroll for one or all parts of Original Medicare.
If one is already receiving Social Security or Railroad Retirement when 65, the individual is automatically enrolled in Medicare and a card will be mailed. For questions about this enrollment call the organization responsible for distributing one’s benefits.
If an individual, or their spouse, continue to work after becoming eligible for Medicare, and the individual is covered by the employer’s health insurance, contact Medicare to understand how it works with other coverage. Failure to have credible coverage (a plan that is at least as good as Medicare) at any point after one becomes eligible for Medicare may result in late penalties and higher premiums. Contact Social Security promptly before the employment-related health insurance ends to make sure there are no delays in coverage.
One can request pamphlets about Medicare benefits by telephone at 1-800-MEDICARE (1-800-633-4227) or online at www.medicare.gov. The Centers for Medicare & Medicaid Services (CMS), the federal agency that administers Medicare, sends a Medicare & You handbook to beneficiaries yearly with the latest information about Medicare benefits and where to get help.
Contact Social Security (1-800-772-1213; TTY 1-800-325- 0778) or the local SSA office for details about when and how to sign-up for Medicare. Online services are available at www.ssa.gov/medicare/sign-up. Individuals who receive benefits from the Railroad Retirement Board (RRB) (1-877- 772-5772; TTY 1-312-751-4701) contact this agency to enroll in Medicare.
Part A: Hospital Insurance
Medicare Part A helps pay the cost of inpatient hospital care, and in some cases, helps pay for home health care, hospice care, and skilled nursing care in a skilled nursing facility (SNF).
Many individuals do not have to pay a monthly premium for Part A coverage if they or their spouse worked for a designated amount of time and paid Medicare taxes. However, some individuals may have to pay a premium and may also pay a late penalty if they do not enroll within the initial enrollment period.
For inpatient hospital care, per benefit period, the patient must pay the deductible-the cost before Medicare begins paying (set annually; $1600 as of Jan. 1, 2023). A benefit period begins with admission to a hospital or SNF and ends when no inpatient or SNF care has been received for 60 days in a row. No limit exists for the number of benefit periods.
More information about Part A covered services costs can be found by contacting Medicare by phone, online, or within the Medicare & You handbook.
Written material about patients’ rights under Medicare should be provided upon admission.
Soon after admission, the patient and family should be contacted by the discharge planner or social worker. If such contact is not made, ask for it. Plans for patient care after discharge should be made as early as possible. For scheduled procedures, basic planning can be done before entering the hospital.
The amount Medicare will pay for a hospital stay is based on a patient’s diagnosis and whether hospital care is medically necessary. Once a doctor has decided it is no longer medically necessary for a patient to remain hospitalized, the person will be discharged.
If the patient or family disagrees with the decision to discharge the patient, they can appeal before leaving a hospital or other skilled care facilities. To appeal, contact KEPRO (page 131), Tennessee’s Medicare Quality Improvement Organization, for information and assistance in starting the appeal process within the time allowed. One may have to insist on the right to appeal.
Part B: Medical Insurance
Medicare Part B helps pay for medically necessary doctors’ care, outpatient care, durable medical equipment, home health care, some mental health services, and many preventative services.
Enrollees pay a monthly premium and yearly deductible for Part B. Ask Medicare for more information. Part B will
generally pay at least 80 percent of the Medicare-approved amount for any eligible service. Many preventive procedures do not require the 20-percent copayment. Doctors and durable medical equipment suppliers who accept as their full fee what Medicare allows are said to “accept Medicare assignment.”
The only way individuals may delay taking Part B without penalty is if they are enrolled in a plan that is at least as good as Medicare (creditable coverage).
More information about Part B covered services costs can be found by contacting Medicare by phone, online, or within the Medicare & You handbook.
Part D: Prescription Drug Insurance
Medicare Part D helps pay for medically necessary prescription drugs for beneficiaries. Medicare Part D is optional; however, there is a penalty for beneficiaries who do not enroll when initially eligible and who do not have creditable coverage, and then later enroll. The annual open enrollment period is Oct. 15 to Dec. 7 each year. Anyone enrolled in Part A or Part B may join a Part D plan. There may be a Part D premium and yearly deductible.
More information about Part D coverage can be found by contacting Medicare by phone, online, or within the Medicare & You handbook. Each plan has a specific formulary, or drug list, of covered prescription medications. Contact the Part D plan directly for access to the formulary. It is important for beneficiaries to review their Part D plan each year to make sure it is still the best plan for them.
Enrollees eligible for both Medicare and Medicaid (“dual eligibles”) currently receive prescription drug coverage through Medicare, not Medicaid.
Help with Prescription Drug Costs and Plan Reviews
Low-Income Subsidy (LIS) or Extra Help is a program available to low-income seniors who need help affording prescription medications. The Inflation Reduction Act may also help many seniors receive lower drug and vaccine costs or improved Part D coverage. Several changes are set to begin at different time periods over the next few years. Call AMOS or the Tennessee State Health Insurance Assistance Program (SHIP) for help applying for LIS or for other options that may be available to lower the costs of medications. These organizations can also help with Prescription Part D plan comparisons.
Medigap (Medicare Supplement Insurance)
Low-Income Subsidy (LIS) or Extra Help is a program available to low-income seniors who need help affording prescription medications. The Inflation Reduction Act may also help many seniors receive lower drug and vaccine costs or improved Part D coverage. Several changes are set to begin at different time periods over the next few years. Call AMOS or the Tennessee State Health Insurance Assistance Program (SHIP) for help applying for LIS or
for other options that may be available to lower the costs of medications. These organizations can also help with Prescription Part D plan comparisons.
Medicare Advantage Plans
Medicare Advantage plans (Medicare Part C) are approved by Medicare but administered by private companies. When you join a Medicare Advantage plan, you are still in Medicare, but you cannot simultaneously hold a Medicare Advantage plan and Original Medicare. When you have an Advantage plan, you do not need a Medigap policy; it is illegal for anyone to sell you one.
Medicare Advantage plans provide all of your Part A and Part B coverage and must cover medically necessary services. They may offer extra benefits (such as dental care, routine eye exams, and preventive care), and many include Part D drug coverage. However, you must still pay your Medicare Part B premiums in addition to any premiums charged by the Medicare Advantage Plan. The kinds of Medicare Advantage plans available in our area are:
- Health Maintenance Organizations (HMO)
- Preferred Provider Organizations (PPO)
- HMOs with Point of Service (POS) options
- Special Needs Plans
Medicare Advantage plans have networks, which means you may have to see doctors who belong to the plan or go to certain hospitals to get covered services. In many cases, your costs for services can be lower than the Original Medicare Plan.
Although Medicare Advantage plans have many advantages, consumers should understand that providers are encouraged to be as cost-effective as possible. If you are denied services, an appeal is worth pursuing. Each plan has a member services phone number for help with the appeal process.
More information about Medicare Advantage coverage or the plans available within the state can be found by contacting Medicare by phone, online, or within the Medicare & You handbook. Plan comparisons specific to
zip codes can be completed on Medicare.gov or by calling Medicare.
Factors to Consider When Choosing Coverage
To decide whether to enroll in a Medicare Advantage plan (HMO, PPO, or Special Needs) or remain in Original Medicare, evaluate the pros and cons.
Original Medicare has NO maximum out of pocket expense for services. A Medigap policy helps cover many of the costs of Original Medicare. Many Medicare Advantage Plans have a maximum the individual pays for health services.
An HMO limits an individual to the doctors, hospitals, and healthcare providers that have signed contracts with that plan. A PPO allows nonparticipating physician visits with a higher copayment. Original Medicare allows a choice, of physicians, hospitals, and other providers, and covers eligible services anywhere in the U.S as long as the facility or provider accepts Medicare.
- Check with all doctors, specialist(s), hospital(s), other providers of health services, and pharmacies to find out whether they are members of the Medicare Advantage plan being considered. If the provider is not affiliated with the plan, or leaves the plan, their services will not be covered.
- An HMO may require prior approval from the primary
care physician (usually a general practice physician, family care physician, or internist) to see a specialist, have surgery, or obtain medical equipment. If the plan is expected to pay; in some instances, prior approval from the managed care company may also be required. Original Medicare generally allows more freedom in choosing medical providers.
- PPOs allow members to see specialists without a plan referral and also may offer out-of-network benefits. However, some specialists may want a referral regardless of the plan’s requirements.
- Individuals must continue to pay Part B premiums in all types of Medicare Advantage plans unless qualified for assistance from the State of Tennessee.
- Some Medicare Advantage plans have low premiums and modest copayments and coinsurance. Medigap policies have monthly premiums and sometimes deductibles.
- Medical expenses are more predictable under Medigap and Medicare Advantage plans because monthly premiums and deductibles are known in advance.
- Benefits, premiums, copayments, and medical providers included in Medicare Advantage plans may change annually, as well as the plans available in the area.
- Individuals should understand clearly what is required by the plan if emergency or urgent medical care is needed when not in the geographic area served by the plan.
- When comparing Medicare Advantage plans, compare copayments, premiums, and added benefits and their costs and limits. For example, what medicines are covered? What is the copay for hospital or nursing home stays?
If an individual joins a Medicare Advantage plan and drops a Medigap policy, there may be Medigap protections that allow a return to the old policy (possibly at a higher cost) or to buy a new one if the choice to leave the Medicare Advantage plan or other Medicare plan occurs within the first year. Always check with the supplement plan before changing to understand options.
For reliable information about obtaining desired Medicare benefits, contact Affordable Medicine Options for Seniors (AMOS) or the local office of Tennessee State Health Insurance Assistance Program (SHIP).