I recently got emails and a phone call from people living outside the U.S. who are turning 65 soon. Their questions were the same: Do I need to enroll in Medicare Part B and pay the $99.90 per month premium if I am living outside the United States? (Medicare does not cover medical services received outside the U.S.)

WORKING OUTSIDE THE U.S. AFTER 65

Bill lives in France and is working for Airbus, a very big employer. Because he is working and covered by an employer group health plan, you would think he meets the criteria in the 2012 Medicare & You Handbook (page 24).  It says a person who is working and has health insurance through an employer or union can keep that coverage and doesn’t need to enroll in Medicare Part B. This is what I wrote when I first posted on this topic last week – but it turns out that this rule might not apply to a person living and working overseas.

UPDATE:  It turns out that working outside the U.S. with health insurance is not necessarily treated the same as working inside the U.S.  I talked to Medicare and Social Security and got different and confusing answers. I also got scolded by someone with lots of experience writing about Medicare.

Patricia Barry, who writes the“Ask Ms. Medicare” column for the AARP Bulletin, read my original post and told me I was wrong to assume that foreign health coverage through employment would be treated the same as American coverage. Here’s what she wrote:

When I was in contact with SSA about this question, they defined for me the kind of coverage that would count as creditable for Part B purposes and they emphasized not only that national health services do not count but also that it had to be “American style” group health insurance — a kind that hardly exists in other countries.

Airbus is a European company and I doubt very much whether it would provide employees with American-style group health insurance, unless it made a special exception in his case.  Airbus is based in France, which has an excellent national health system, so it does not need to provide health insurance in the way that companies do in the U.S.  

I contacted Bill and told him he needed to talk directly to Social Security.  Here is his report from his call to Social Security (from France):

After being on hold forever I talked to SS yesterday, the woman did not know the answer but put me on hold and eventually came back and said I had to enroll and pay if I wanted to avoid the penalty.  It did not matter that I am completely covered here.  That is  not the way I read the outline online.  Going to try someone from the Louisiana delegation to see if I can get an answer in writing or email.

**LATEST UPDATE: See a later post with documentation that says Bill does not need to enroll in Medicare Part B because his group health plan, based on a national health plan, is recognized by Medicare as creditable coverage.  Click here for that info.

RETIRED AND LIVING OUTSIDE THE U.S.

Jim and his wife live in Mexico along with tens of thousands of other retired Americans. He is not working, but he and his wife are enrolled with the Mexican national health plan. The answer to his question was….. not clear when I called 1-800-Medicare. The person with whom I spoke could not find a definitive answer, so he took my phone number and said Medicare would get back to me. He told me this was the first time he had been stumped by a question about Medicare.

The eventual answer I got was “yes”, Jim must enroll in Medicare Part B when he turns 65, or he will begin to accrue a penalty of 10% for each year he is not enrolled in Part B. So if Jim returns to the US after 5 years and wants his Medicare Part B, he will pay a 50% higher premium.  At today’s rate, he would be paying $150 per month rather than the standard $99.90

The Medicare rep told me I should call Social Security, since they handle enrollment in Medicare.  The person I spoke with at Social Security was very clear about Jim’s situation in Mexico. She said enrollment in a country’s health plan does not count as creditable coverage. I asked her about employer coverage and she said that would exempt a person from the Part B enrollment requirement – but “Ask Ms Medicare” says this was incorrect information.

Here’s what else I found out:

People living in the U.S. and collecting Social Security when they turn 65  are automatically enrolled in Medicare Part A and B, and receive their Medicare card about three months before their 65th birthday. Medicare figures they want Medicare Part B. (I knew that.)

HOWEVER, people living outside the US who are collecting Social Security are not automatically enrolled in Part B. This is rather odd, since they are supposed to sign up for Part B even though they are living abroad, as explained above. I guess Medicare figures they might not want Part B.

What about Medicare supplements?

Jim in Mexico said he will sign up for Part B and would want a Medicare supplement – but his official address is in Mexico. He is registered with the local US Consulate as being a resident of Lake Chapala.

I know a person must use a physical address (not a P.O. Box) when filling out a Medicare supplement application. And I know Medigap premiums are based on the state in which a person resides. So I emailed a manager for UnitedHealthcare’s AARP Medicare supplements.

This question stumped my UHC contact. He trains brokers who sell their plans, and he always has answers to my questions – but not this one. He emailed me back a few days later with an answer from the UHC compliance department: A person must have a physical address in the U.S. to enroll in an AARP Medicare supplement. They cannot use a relative’s address.

Jim in Mexico cannot tell a Medigap company  he has a primary address in the U.S. because he is registered with the local US Consulate and Social Security as residing in Lake Chapala. So, he can have Medicare A and B  in case he gets really sick and needs to return to the US for care – but he is left with potentially big medical bills because he can’t enroll in a Medigap plan (or a Medicare Advantage plan).

That doesn’t seem right. Jim will be penalized if he doesn’t sign up for Part B. But if he enrolls in Part B, he doesn’t have the option of other Medicare coverage that would protect him from huge medical bills – options other Americans have. It seems like he is being penalized even if he does enroll in Part B.

WHY ISN’T THERE SOMETHING IN WRITING?

This is all very confusing and kind of disturbing. I got one answer from Social Security while Bill in France got a different answer.  And why wouldn’t Bill’s excellent coverage in France not count? Why should Americans working overseas have to pay for something they don’t need – especially when they have coverage that is BETTER than what they would get on Medicare (without paying additional money for a supplement).  And why isn’t this topic addressed in written form so people won’t make a wrong and potentially costly assumption based on what they find in the Medicare & You Handbook?

CLARIFICATION ON ENROLLING IN PART B: Enrolling in Part B is “voluntary”, BUT a person is penalized if they delay enrollment (unless they are working and covered by employer health  insurance. (This employment exception seems to apply only to people who have “american-style” health insurance.)

I had an appointment yesterday with my tax accountant who is over 65 and on Medicare.  She is my accountant but not my client, but she asked me about a bill she got from her dermatologist.  The bill showed the charges for her treatments in the office, and it showed what Medicare paid and what her Medicare supplement paid.  It looked like the doctor’s office was “balance billing her” – though I didn’t look that closely at the bill.  I told her to call the doctor’s office and ask for an explanation of the bill.

One clue I did not pick up on:  The amount due was $162.

Second clue: This lady has a Plan N Medicare supplement.

As I drove away from the appointment, my cell phone rang.  It was my accountant calling to tell me she had spoken with the doctor’s office about the bill. They told her she has a deductible in her coverage, and that’s what the $162 is.

Duuuuuuh! How could I forget that?  Medicare Part B has a $162 deductible, and Plan N does not cover it.  Plan N has a lower premium than a Plan F or C because a person must pay a $20 co-pay when they go to a doctor’s office. They also pay a $50 co-pay if they go to the emergency room.  And they pay the Part B deductible each year ($162 in 2011).

I am an insurance agent and I forgot about the Part B deductible not being covered by Plan N.  (Of course, I was not in my working-and-explaining-Medicare-mode when I was meeting with my tax accountant.) I can see lots of folks getting Plan N for a lower monthly premium and then having greater confusion when they get their medical bills.

I usually suggest people get a Plan F Medicare supplement. “Think F as in full coverage”, I say.  With Plan F they don’t have to worry about co-pays and deductibles because Plan F fills all the gaps in Medicare.  I have had several clients who were diagnosed with cancer, and they called me specifically to tell me how grateful they were to have a Plan F Medicare supplement because they never had to think about their medical bills.

I just thought I’d pass on this tidbit of wisdom I gained this week.

As part of the Affordable Care Act, Medicare now covers annual wellness visits and will provide payment for the creation of a personalized prevention plan.  The wellness visit will include a health risk assessment to:

• Establish or update the individual’s medical and family history;
• Create a list of current providers and suppliers involved in providing medical care, including a list of prescriptions;
• Take measurements of height, weight, body mass index, blood pressure and other routine measurements; and
• Detect cognitive impairments.

During the wellness visit, the health professional will establish or update a screening schedule for the next 5-10 years, based on recommendations of the United States Preventive Services Task Force (USPSTF).  The recommendations of USPSTF are based on an individual’s age and health status.  The visit may include health education or preventive counseling services designed to reduce risk factors that have been identified during the visit.  Examples of such education and counseling services include those designed to promote self-management and wellness, including weight loss, physical activity, smoking cessation, fall prevention and nutrition.

The wellness visit may be conducted by a physician or another practitioner whose services are recognized by Medicare.  Such practitioners include physician assistants, nurse practitioners, clinical nurse specialists, certified nurse-midwives, clinical social workers, and clinical psychologists. Practitioners may also include health educators, registered dietitians, or nutrition professionals working under the supervision of a physician.

The services for which no cost-sharing (deductible and/or co-payment) will be charged are:

• Mammograms every 12 months for eligible beneficiaries age 40 and older;
• Colorectal cancer screening, including flexible sigmoidoscopy or colonoscopy (see below);
• Cervical cancer screening, including a Pap smear test and pelvic exam;
• Cholesterol and other cardiovascular screenings;
• Diabetes screening;
• Medical nutrition therapy to help people manage diabetes or kidney disease;
• Prostate cancer screening (for most codes);
• Annual flu shot, pneumonia vaccine, and the hepatitis B vaccine;
• Bone mass measurement;
• Abdominal aortic aneurysm screening to check for a bulging blood vessel;
• HIV screening for people who are at increased risk or who ask for the test.[6]

Cost-sharing is also eliminated for the wellness visit and personal prevention plan.

CMS (Centers for Medicare and Medicaid) indicates that the following preventive services covered by Medicare will continue to be subject to cost-sharing:

• Digital rectal examination furnished as a prostate cancer screening service;
• Glaucoma screening;
• Diabetes self-management training services;
• Barium enema furnished as a colorectal cancer screening.

Note that, for all services, current coverage policies continue to apply.  For example, Medicare only covers bone mass measurements once every two years for qualified high-risk individuals. Testing within that time frame for people who meet the eligibility criteria will not be subject to a deductible or co-payment.  Bone mass measurement will not be covered for someone who is not a high risk individual, however, regardless of the change in cost-sharing requirements.