medigap (medicare supplement insurance) module 3
TRANSCRIPT
04-16-08 5
What Is Medigap?
Health insurance policiesSold by private insurance companiesCover “gaps” in Original Medicare Follow Federal and state laws that protect
youMust say “Medicare Supplement Insurance”
Overview
04-16-08 6
What Is Medigap?(continued)
Health insurance policies12 standardized policies in most states
• Plans A – L Non-standard policies
• Massachusetts• Minnesota• Wisconsin
Costs may vary• By plan• By company• Where you live
Overview
04-16-08 7
How Medigap Works
Only works with Original MedicareDon't need Medigap policy in
• Medicare Advantage Plan
• Other Medicare plans
Can go to any doctor, hospital, or provider that accepts MedicareUnless you have Medigap SELECT policy
Overview
04-16-08 8
Medigap Is Not
Medicare Advantage PlansMedicare Part BMedicare Prescription Drug PlansMedicaidEmployer or union planTRICAREVeterans’ benefits
Overview
04-16-08 9
Who Can Buy Medigap?
Must have Medicare Parts A and BMay not be able to buy Medigap under 65
People with a disabilityPeople with End-Stage Renal Disease
Guaranteed right to buy a Medigap policyIn your Medigap open enrollment periodCovered under a Medigap protection
Overview
04-16-08 11
Why Buy Medigap?
Original Medicare does not pay all costsMedigap policy may help you
Lower your out-of-pocket costsGet more health insurance coverage
Medigap Benefits
04-16-08 12
Gaps in Original Medicare
Hospital Stays
Skilled Nursing
Blood
– $1,024 deductible for days 1 – 60 – $256 per day for days 61 – 90 – $512 per day for days 91 – 150
– $0 for first 20 days– $128 per day for days 21 – 100– 100% after day 100
– 100% for first 3 pints– 20% for additional pints
What you pay in 2008—Part A
Medigap Benefits
04-16-08 13
Gaps in Original Medicare
Home Health Care
Hospice Care
– $0 for home health care services
– 20% for durable medical equipment
– Up to $5 copayments for outpatient prescription drugs
– 5% for inpatient respite care – Room and board, in some
cases
What you pay in 2008—Part A
Medigap Benefits
04-16-08 14
Gaps in Original Medicare
Part B Deductible
Part B Services
– $135 per year
– 20% coinsurance for most covered services
– 50% coinsurance for outpatient mental health
– Copayments for hospital outpatient services
What you pay in 2008—Part B
Medigap Benefits
04-16-08 15
Medigap Coverage
Plans A – JAll cover basic benefits
• Part A coinsurance for inpatient hospital care
• Cost of 365 extra days of inpatient hospital care
• Part B coinsurance after deductible• First 3 pints of blood each year
Some plans cover more
Medigap Benefits
04-16-08 16
Other Medigap Benefits
Most plans have extra benefitsSome Medigap policies cover
Part A deductiblePart B deductibleAt-home recoveryMedicare Part B excess charges
• Subject to the “limiting charge”Other services
Medigap Benefits
04-16-08 17
Medigap Plans K & L
Basic benefitsPart A coinsurance for inpatient hospital careCost of 365 extra days of inpatient hospital carePlan K pays 50% and Plan L pays 75% of
• Part A deductible• Part B coinsurance after deductible
• Except 100% for covered preventive services
• First 3 pints of blood each year• Hospice care
Medigap Benefits
04-16-0802-13-08 18
Medigap Benefits ComparisonBenefit Plans A - J Plan K Plan L
Part A Deductible Plans B - J: 100% 50% 75%
Part A Coinsurance Days 61 - 90 100% 100% 100%
Part A Coinsurance Lifetime Reserve Days 91 - 150
100% 100% 100%
365 Additional Hospital Days 100% 100% 100%
Hospice Coinsurance 0% 50% 75%
Skilled Nursing Facility Care Coinsurance Days 21 - 100
Plans C - J: 100% 50% 75%
Blood Deductible 100% 50% 75%
Part B Deductible Plans C, F, J: 100% 0% 0%
Part B Coinsurance 100% 50% 75%
Part B Excess Charges Plans F, I, J: 100%
Plan G: 80%
0%* 0%*
*Excess charges do not apply toward meeting the annual out-of-pocket maximum. Out-of-pocket maximum is $4,440 for Plan K and $2,220 for Plan L (in 2008).
Medigap Benefits
04-16-08 19
Items Not Covered
Long-term careVision and dental care
Including eyeglasses
Hearing aidsPrivate-duty nursingOutpatient prescription drugs
Medigap Benefits
04-16-08 21
Special Types of Medigap Plans
Medigap plans with drug coverageHigh deductible plans
Plans F, JMedigap plans with hospice care
Plans K, LMassachusetts, Minnesota, and WisconsinMedicare SELECT
Medigap Plans
04-16-08 22
Drug Coverage and Medigap
Medigap policies covering prescription drugsMay not be sold after January 1, 2006Same policies may be sold without drug coverage
If your Medigap policy covers drugsShould have received information from company
• Explains how drug coverage affects your policy
Medigap Plans
04-16-08 23
Medigap Plans With Drug Coverage
Standardized plans H, I, JSold before January 1, 2006
Some policiesMassachusettsMinnesotaWisconsin
Some pre-standardized plansOthers
Medigap Plans
04-16-08 24
F and J High Deductible Option
$1,900 deductible for 2008Amount can go up each year
Often have lower premiumOut-of-pocket costs may be higherMay not be able to change plansAdditional deductibles
Prescription drugsForeign travel
Medigap Plans
04-16-08 25
Plans K and L
Pay only partial costs after Medicare paysHave annual out-of-pocket maximumPlan K
50% for most services$4,440 out-of-pocket limit in 2008
Plan L 75% for most services$2,220 out-of-pocket limit in 2008
Medigap Plans
04-16-08 27
How Much Does Medigap Cost?
Depends onYour age (in some states)Where you liveCompany selling the policy
Can be big differences in premiumsFor exactly the same coverage
Compare the same Medigap policies
Medigap Costs
04-16-08 28
Pricing Based on AgeNo-age-rated
(community-rated)
Everyone pays same
Generally least expensive over lifetime
Issue-age-rated Based on age when purchased
Does not go up automatically as you get older
Attained-age-rated Goes up automatically as you get older
Costs less when you are 65
Costs more at age 70 or 75
04-16-08 29
What is Underwriting?
ReviewHealth statusMedical history
Insurance company determinesWhether to accept your applicationHow much to charge youWhether to make you wait for some benefits
ApplicationUsually includes medical questions Fill out carefully
Medigap Costs
04-16-08 30
Buying a Medigap Policy
May be able to buy a policy any timeBest time is during open enrollment period
Lasts for 6 monthsStarts on first day of the month you are
• Age 65 or older AND
• Enrolled in Medicare Part B
Once 6-month Medigap open enrollment period starts, it can't be changed
Medigap Costs
04-16-08 31
Open Enrollment Period
Insurance company can’tDeny you coverageMake you wait for coverage to start
• But may make you wait for coverage of pre-existing conditions
– Unless you have creditable coverage
Charge you more for a policy• Because of your health problems
Medigap Costs
04-16-08 32
Let’s look at a case study…
It is October 1, 2008, and Sam (who is 65) wants to buy a Medigap policy. He needs to know if he is in his open enrollment period. He looks at his Medicare card. His Medicare Part B coverage started August 1, 2008.Is Sam in his Medigap open enrollment period?Can the company deny him coverage?
Medigap Costs
04-16-08 34
Session Topics
Prior creditable coverageUnder age 65Medigap and MedicaidGuaranteed issueMore information
04-16-08 35
Session Topics
Prior creditable coverageUnder age 65Medigap and MedicaidGuaranteed issueMore information
04-16-08 36
Pre-Existing Condition
Health problem before new policy startsMedigap company can refuse to cover
that conditionIf diagnosed or treated during the 6 months
before the policy startsFor up to 6 months in some casesCalled “pre-existing condition waiting period”
Medigap Coverage
04-16-08 37
Creditable Coverage
Coverage you had before applying for MedigapCan avoid or shorten waiting period for a
pre-existing conditionMedigap company cannot refuse to cover
pre-existing conditions• If at least 6 months creditable coverage
– With no break in coverage of more than 63 days
Medigap Coverage
04-16-08 38
Examples of Creditable Coverage
Union/employer group health plan
Some health insurance policies
Medicare Part A or B Medicaid IHS or tribal organization A state health benefits
risk pool
TRICARE FEHBP Public health plan Health plan under the
Peace Corps Act COBRA SCHIP
Medigap Coverage
04-16-08 39
Not Creditable Coverage
Hospital indemnity insuranceSpecified disease insurance
For example, cancer insurance
Vision or dental policiesLong-term care policies
Medigap Coverage
04-16-08 40
Let’s look at a case study…
Harry is 65 and was diagnosed with heart disease early in 2007. His Medicare Part A and Part B started November 1, 2007. Before that date, he had no health insurance coverage. Harry buys a Medigap policy with coverage starting March 1, 2008.Can the Medigap insurance company refuse to cover
Harry’s heart condition for 6 months?Does Harry have prior creditable coverage?What if Harry’s heart condition hadn’t been diagnosed?
Medigap Coverage
04-16-08 41
Session Topics
Prior creditable coverage
Under age 65Medigap and MedicaidGuaranteed issueMore information
04-16-08 42
Medigap for People Under 65
Federal law does not require coverageMay not be able to buy a Medigap policySome state laws are differentAt age 65
Can choose and buy any Medigap policyCompanies cannot refuse to sell Medigap6-month open enrollment periodAlready have Medigap
• May reapply to get a better rate
Under Age 65
04-16-08 43
Medigap for People Under 65
Some companies sell to people under 65Policies may cost more
Some states require Medigap be offeredSee Guide to Health Insurance for People
with Medicare
Another open enrollment period at 65
Under Age 65
04-16-08 44
Right to Suspend Medigap
Under 65 and entitled due to a disabilityRight to suspend your Medigap policy
• While enrolled in employer group health plan
• Without penaltyGet your Medigap policy back at any timeMust notify Medigap insurer within 90 days of
losing employer group coverage
Under Age 65
04-16-08 45
Session Topics
Prior creditable coverageUnder age 65
Medigap and MedicaidGuaranteed issueMore information
04-16-08 46
Medigap and Medicaid
If you have both Medicare and MedicaidMost health care costs are coveredCan suspend Medigap policy for up to 2
yearsAn insurance company can sell you a
Medigap policy only in certain situations
For information, call state Medicaid office
Medigap and Medicaid
04-16-08 47
Suspending Medigap
Right to suspend MedigapWithin 90 days of getting MedicaidDo not pay premiumsPolicy will not pay benefitsCan suspend policy for up to 2 yearsCan start it up again
• No new medical underwriting• No pre-existing condition waiting periods
Call state Medicaid office
Medigap and Medicaid
04-16-08 48
Session Topics
Prior creditable coverageUnder age 65Medigap and Medicaid
Guaranteed issue rightsMore information
04-16-08 49
Medigap Rights and Protections
Also called “guaranteed issue rights”Special rights to buy MedigapKeep
LettersClaim denialsPostmarked envelopes
Protections are in Federal lawMany states provide more Medigap protectionsCall your SHIP or state insurance department
Guaranteed Issue Rights
04-16-08 50
Summary of Medigap Protections
Guaranteed issue rights in some situationsRight to buy a Medigap policyApply within 63 days from other coverage
ending
In these situations, an insurance companyMust sell you a Medigap policyMust cover all pre-existing conditionsCan’t charge more because of past or present
health problems
Guaranteed Issue Rights
04-16-08 51
Guaranteed Issue Rights
Rights to purchase plans A, B, C, F, K, or L, if 1. Medicare Advantage or PACE coverage ends
2. Employer group health plan coverage that pays secondary to Medicare ends
3. You move out of the plan's service area
4. You joined a Medicare Advantage or PACE plan• First eligible for Medicare at age 65 and
leave within 12 months
Guaranteed Issue Rights
04-16-08 52
Guaranteed Issue Rights(continued)
5. You dropped a Medigap policy and enrolled in Medicare Advantage Plan for first time• Stayed in the plan less than a year and• Want to switch back
6. Medigap coverage ends through no fault of your own
7. Plan or insurance company committed fraud
Guaranteed Issue Rights
04-16-08 53
Let’s look at a case study…
Jennie is 69 and joined a Medicare Advantage Plan when she first was eligible for Medicare at age 65. She decides she would like to drop her Medicare Advantage Plan and go to Original Medicare.Does Jennie have a guaranteed issue right to a
Medigap policy?
Guaranteed Issue Rights
04-16-08 54
Session Topics
Prior creditable coverageUnder age 65Medigap and MedicaidGuaranteed issue
More information
04-16-08 55
Information Sources for Medigap
2008 Choosing a Medigap Policy: A Guide to Health Insurance for People With MedicareAvailable on www.medicare.gov
SHIPState insurance department1-800-MEDICARE
1-800-633-42271-877-486-2048 for TTY users
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