In the last two weeks, I have talked to several people who delayed enrollment in Medicare Part B because they were working beyond their 65th birthday or were covered by their spouse’s employer health insurance. Every one of them was a bit confused about what they needed to do to get Part B.

Steps to take to get Part B:

If people plan ahead, they can take care of their delayed enrollment in Part B by mail. But everybody I have spoken with waited until the last minute and wanted their coverage to begin on the first of the next month. So they needed to move quickly to get their paperwork in order.

Katherine, who is 66, called Social Security to tell them she wants her Part B to begin on June 1st. She asked about getting the necessary paperwork on-line and was told the forms are not on the Social Security website. (I wonder why?) She was told to google the following:

CMS-40B     This form is used to apply for Part B using a special enrollment period.

CMS-L564   This form must be signed by the person’s employer to certify that he/she has had employer group health insurance.

These two completed forms can be taken to the local Social Security office, and the enrollment in Part B can be in the system in just a day or two. It’s a good idea to call Social Security (800-772-1213) to see if you can make an appointment at the local office. When talking to Social Security, ask if  there are any other documents you need to provide. I have heard of some people being required to provide a birth certificate.

When I talked to Connie, who is 66 and just quit work, she asked me to email her the two forms mentioned above.  When she called Social Security to make an appointment at the Tucson office (3500 N Campbell), she was told she would have to go into the local office, take a number, and wait her turn.

Part B is required to apply for Medicare Advantage or Medigap.

A person cannot submit an application for Medicare Advantage or Medigap until their Part B is in the system. Last month I worked with Fred, who waited until Monday, April 23rd to submit his forms to Social Security. Two days later, we sent in an application for  a Medicare Advantage plan with a start date of May 1. I was worried the application would be rejected because his Medicare record would not show he had Part B.  My fears were unfounded because he was in the system – just two days after submitting his paperwork for Part B.

Medicare Advantage: When a person has delayed enrollment in Part B because he had employer health coverage, a specific code must be put on the Medicare Advantage application. If the wrong code is used, Medicare will reject the application. (Note to new insurance agents: This is not an IEP or ICEP.)

Medigap: A person who has had employer health coverage can get a Medicare supplement with “guaranteed issue”, no matter what his age or what health problems he has.  The Medigap application has some confusing questions that actually pertain to guaranteed issue. (Experienced insurance agents know what I’m talking about.)

I have been pleasantly surprised at how efficiently the local Social Security office performed for people who waited until the last moment to submit their paperwork for Medicare Part B.  If a person takes care of this two months before they want Part B to begin, they can receive and submit their paperwork by mail. But it seems like a lot of people are not aware of what they need to do to get their Part B started if they delayed enrollment for good reasons.

If you are turning 65 in the next few months, you have choices to make concerning your Medicare coverage.  Do you think a Medicare Supplement will be better coverage? Will you consider enrolling in a Medicare Advantage plan? If you’re still working and have employer coverage, do you even need to enroll in Medicare?

Here is some information to get started in understanding your Medicare choices:

MEDICARE ONLY: You will be responsible for the Part A hospital deductible and other co-pays. You will pay the Part B deductible. You will be responsible for 20% of the bills for doctor visits and services, lab tests, emergency room treatment, ambulance, chemotherapy, radiation therapy, physical therapy, and most medical care you receive outside a hospital.  THERE IS NO CAP TO YOUR 20% CO-INSURANCE.   Having just Medicare is risky because your medical bills can be overwhelming. The Medicare Part B premium is $99.90 per month.

MEDICARE SUPPLEMENTS: These work with your Medicare to give you more complete coverage. Also known as “Medigap ” plans, these fill the gaps in Medicare, some of which I listed in the previous paragraph. A Medicare Supplement Plan F will generally leave you with no medical bills because Medicare will pay first and your Plan F Medicare Supplement will pay the balance of the bills after Medicare has paid.  I always say, “think FULL coverage when you think of PLAN F”.

Medigap plans are named by letters: A, B, C, D, F,  G, K, L, M, N   and each one covers the gaps in a slightly different way. Because Plan F offers the fullest coverage, it has the highest monthly premium.

Plan F in Arizona will cost between $110 and $136 per month, depending on the company.  A Plan F is exactly the same from company to company. Beware of companies offering low premiums. They start out with the lowest premium and then raise the rate 30% or more the next year – and perhaps every year.  If you end up with health issues, you might not be able to change to a lower-priced Medigap plan in the future.

MEDICARE ADVANTAGE:  These are private Medicare plans offered by insurance companies, and they replace your Medicare. If you enroll in an Advantage plan, you won’t use your Medicare card because Medicare doesn’t pay your bills.  You will use the card given to you by your Medicare Advantage (MA) plan and your MA plan will pay your bills.  Many MA plans in Arizona have a $0 premium, though you must pay your Medicare Part B premium ($99.90/month). You will have co-pays for every medical service. For example, you might pay $15 when you see your primary care physician.  And you might pay $45 to see a specialist. Then there are hospital co-pays, emergency room co-pays, co-pays for labs, x-rays and other services.

Each Medicare Advantage plan is different, so you need to compare plans’ co-pays, doctor and hospital networks, and how they cover your drugs.

PART D: This is the drug plan which Medicare wants you to have (and pay for). If you get a Medicare Supplement, you should also sign up for stand-alone Part D plan.   Part D is offered by insurance companies that are contracted with Medicare.  Each Part D plan has a different monthly premium and a different formulary (list of drugs covered). Stand-alone Part D premiums range from $15 to $90 per month.

If you enroll in a Medicare Advantage plan with $0 premium, you get Part D at no additional cost.

Before signing up for a Part D plan or a Medicare Advantage plan with Part D included, you need to be sure your drugs are covered by that plan and what your co-payment will be.

STILL WORKING: If you are 65, working, and have good employer health insurance, you might not need to enroll in Medicare and pay the Part B premium ($99.90/month).  If you work for an employer with fewer than 20 employees, Medicare should be your primary insurance. If you work for a slightly larger company, you need to compare Medicare with your employer coverage. Small business health insurance often has high deductibles and high premiums. Medicare might be a better choice than your employer’s coverage.

You can see a video explaining these choices by clicking here: Intro to your Medicare choices

HOW TO PICK A PLAN

If you’ve decided to go with Medicare Advantage, you have quite a few plans to choose from. You need to check to see if your doctors are in the plan’s network and how your drugs are covered and at what cost.  This is what I do for my clients and sometimes it’s a lot of work.

If you’ve decided on a Medicare supplement, the only difference from company to company is the premium – although some companies raise their premiums more than others.

If you need a stand-alone Part D, you’ll need to compare plans (30 in Arizona) and figure out which one will cost you the least amount of money – and covers all your prescriptions.

Call me if you have questions or need help with your Medicare choices: 520-820-8639

A common theme among the many proposals to reduce Medicare spending is that seniors and the disabled must pay a larger portion of the cost of their health care.

The theory is that when people have to pay more for medical services, they will be less likely to overuse health care.  This is called “consumer-driven” health care, where the individual decides to take a pass on physical therapy or knee replacement surgery because they have some co-pay which they deem to be too much.  Of course, the question can be asked if seniors will avoid going to the doctor, or getting treatment they really need because of higher co-pays and deductibles.

Kaiser Health News covered some of the proposals for passing on costs to Medicare beneficiaries:

CHANGING MEDICARE’S DEDUCTIBLE AND MEDIGAP COVERAGE: Medicare charges beneficiaries separate deductibles for their hospital care (Part A) and for outpatient and physician services (Part B). This year, in Part A, beneficiaries pay $1,132 for each hospital stay, and enrollees also pay daily co-payments for extended hospital and skilled nursing care. For Medicare Part B, the annual deductible this year is $162. Nearly one in five beneficiaries in Medicare’s fee-for-service program have supplemental insurance known as Medigap coverage to help with those costs.

Some proposals, including one advanced by the president’s deficit panel chaired by former GOP Sen. Alan Simpson and former Clinton chief of staff Erskine Bowles, have suggested combining the Part A and B deductibles into one $550 yearly deductible. That could reduce beneficiaries’ costs for hospital care but be more expensive for seniors who mostly use Part B. In addition, some proposals suggest a 10 to 20 percent co-payment for all services until beneficiaries reach a catastrophic limit. Others argue for making that $550 deductible ineligible for Medigap coverage so that beneficiaries are responsible for covering the cost of those initial services.

How Much Would It Save? Instituting the change in deductibles, co-pays and Medigap rules would save about $93 billion over the next decade, CBO estimates.

The Gain: Medicare would save money, but not just because beneficiaries were putting up more of their own. If Medigap plans were less generous, analysts believe beneficiaries would be more careful about spending and that could help lower Medicare costs.

The Pain: Once again, this proposal would shift costs to individuals.

The full article in Kaiser Health News can be found here.