Social Security payments will increase 1.7% in January 2013. That means an additional $17 for a person whose monthly Social Security check is $1,000. 1.7% of $2,000 is $34. So this is a modest increase for people living solely on Social Security – and I meet a lot of people like this.

At the same time, the Medicare Part B premium will go up $5 per month to $104.90. This amount will be taken out of most people’s Social Security checks starting in January.

HELP FOR PART B PREMIUM

In Arizona, anyone on Medicare whose monthly income is less than $1,277 (individual) or $1,723 (a married couple) should not be paying that $104.50 Part B premium. They should be enrolled in the Medicare Savings Program through which the state pays their Part B premium. People who get Part B help will also be signed up to get help with their prescriptions costs. This is called the Low Income Subsidy.

Medicare beneficiaries who get the Low Income Subsidy (LIS) will pay $6.60 for brand drugs and $3.50 for generics in 2013. Most brand drug co-pays on Part D plans are $35 – $45, so getting the LIS can be a huge help for people.

If you, or anyone you know, might qualify for this help, send me an email.  I can provide the Medicare Savings Program application for Arizona.

OTHER MEDICARE COST INCREASES:

Medicare Part A covers hospitalization and has a $1,184 deductible in 2013. Part A also covers skilled nursing facility charges, home health care, and hospice.

Medicare Part B covers everything else (except drug coverage, which is Part D) and has a $147 deductible in 2013. This is up from $140 in 2012. This deductible comes into play for people who have a Medicare supplement plan N because they must pay the Part B deductible deductible each year.

Most Medicare beneficiaries in Arizona are not directly affected by these increased costs because they have a Medicare supplement Plan F or are enrolled in a Medicare Advantage plan.

Almost half of all Medicare beneficiaries in Pima, Pinal, and Maricopa counties in Arizona are enrolled in Medicare Advantage plans, so the Medicare costs that are going up in 2013, don’t affect them directly. Of course, everybody has to pay the Part B premium (unless the state is paying it for them),and most co-pays that come with Medicare Advantage plans are going up in 2013.

So if you are getting $17, or $30, or $40 more in your Social Security next month, you’ll be spending that much and more on your medical costs.

During the Medicare Open Enrollment Period that just ended on December 7th, many people changed from one Medicare Advantage (MA) plan to another.  Some changed because their doctors were no longer accepting their old MA plan. Some changed because the new plan offers lower co-pays for specialist office visits or hospital stays.

The reasons for changing an MA plan may be varied, but the results are the same for everybody: They need to get new referrals from their Primary Care Physician (PCP) to see their specialists.

Most of the Medicare Advantage plans in Arizona are HMOs (Health Maintenance Organizations), and HMO’s require referrals in order to see a specialist.  So when a person changes to a new MA plan, they are going to have to go back to their PCP office to get referrals set up for 2013.  If they have an appointment to see their cardiologist in January, and they show up  without a referral through their new plan, that could be a problem.

Some Medicare Advantage plans will allow multi-visit referrals, so seeing the dermatologist two or three times per year only requires one referral. But some MA plans are allowing only one-visit referrals, and this means going back to the PCP office for the paperwork every time you need to see your specialist.

I’m not sure how limiting referrals to one visit to the specialist helps control costs for the Medicare Advantage plan – it just seems to create more work for the Primary Care Physician’s (PCP) office. And when a patient arrives at the dermatologist’s office without a referral, the staff will either turn that patient away, or they will get on the phone and ask the PCP office to send over the paperwork ASAP. So instead of lowering costs, it looks to me like it means doctors need more office staff to handle more paperwork. What a system!

But you can’t fight the system, so be advised that if you’ve changed your Medicare Advantage plan, you’ll need to set up new referrals to all your specialists for 2013.

For an introduction to your Medicare choices, check out this five-minute video presentation:

Anyone who is already on Medicare and wants to join or change a Medicare Advantage plan, or a Part D plan, must do so by this Friday, December 7th.

If you are happy with your current Medicare coverage, you don’t have to do anything. Your Medicare Advantage plan, or your Part D plan will roll over for 2013.

If you have some issues with your Medicare Advantage plan or Part D plan, you need to act quickly because the deadline for for most people to make a change is this Friday, December 7th.

Who is not affected by the Open Enrollment deadline?

If you have a Medicare supplement and the premium has gone up more than 20%, you might consider changing to another company – and the December 7th deadline does not apply to you. You can change your Medicare supplement at any time during the year (if you are healthy or in a guaranteed issue period).

If you are turning 65 in December or January (or later) the December 7th deadline does not apply to you.

If you have employer retiree coverage you are thinking about dropping (if you can), the December 7th deadline does not apply to you.

If you have recently moved to Arizona, or a new state, the deadline does not apply to you.

If you get help with your Part B premium or your drug costs, you can change your Medicare Advantage plan or your Part D plan any time during the year.

If you have Medicare AND Medicaid (AHCCCS in Arizona), you can change your Medicare Advantage plan any time during the year.

Making changes? Doctors and Drugs need to be checked.

Don’t wait until the last day of Open Enrollment (Friday, December 7th) to make a change. You can’t just pick another Advantage plan or Part D plan. You must be sure your doctors are in-network if you are considering a Medicare Advantage plan. And you must make sure your drugs are covered and what your cost will be.

If you make the wrong choice because you did not do your research (or have an insurance agent do this for you), you will be stuck in that plan for all of 2013.