Elder Law Firm of Steve Bailey

3 Tips for Choosing a Medicare Plan

“Medicare programs are not “one size fits all,” so how can you figure out which coverage is optimal for you?”

Trying to unravel the multiple pieces and many options of Medicare could try the patience of Job. Medicare has multiple components. Some coverage plans contain pieces of several parts of Medicare. The companies that sell Medicare Advantage and supplemental coverage will tell you that their product is the best.

You have a brief window only of time to choose your coverage every year. It helps to know what you want, before the open enrollment period begins. You should re-evaluate your coverage every year, because plans can change annually and so can your needs. Medicare programs are not “one size fits all,” so how can you figure out which coverage is optimal for you? Here are 3 tips for choosing a Medicare plan.

1. Learn Your Options

Medicare’s website has a treasure trove of material that explains what “Original Medicare” covers. If you stay with original Medicare (Parts A and B), buy separate coverage (Part D) for prescription drug benefits. Do not stick with original Medicare, though. You could choose a Medicare Advantage (MA) plan. Some MA plans include drug coverage, but others do not.

The premiums, deductibles, co-pays, available doctors and hospitals and services covered will vary from one MA plan to the next. Whether you buy original Medicare or a Medicare Advantage plan, purchase supplemental coverage to help pay some expenses (like co-pays and deductibles) that your program does not cover. Try to find a coverage package that fits your budget, health status and anticipated future needs. The perfect plan for you, might be all wrong for your next-door neighbor.

2. Ask Questions

To make a meaningful comparison between different plans, you must look at the same factors of each option. Ask questions about these topics for each type of coverage:

• Whether the doctors who already treat you will accept the plan.
• Which doctors in your area accept the coverage.
• Whether the plan limits you to physicians and hospitals in the plan’s network.
• If the plan makes you get a referral from your primary care physician to see a specialist.
• How much your premiums will cost.
• Your out-of-pocket and maximum annual costs for deductibles, co-pays, doctor appointments and hospitalization.
• Whether your prescription drugs are covered and how much your portion of the cost will be.
• Whether the pharmacy you use now will accept the plan, and whether the coverage allows you to get your drugs through the mail.

3. Make Notes

Create your own “cheat sheet” to make your annual evaluations of your Medicare options a breeze. Write down the information you gathered, when answering the questions. Put those notes into a “Medicare Options” folder with a brief explanation of why you chose the plan you did, and why you did not select the other programs.

Next year, the process will be quicker and easier. Realize, however, that the companies can  change their coverage. Verify that the information is still current from one year to the next.

The available coverage will be different, depending on the state where you live. Every state also has different laws, so be sure that you meet with an elder law attorney in your area. This article talks about the general law.

References:

AARP. “How to Choose a Medicare Plan.” (accessed October 6, 2018) https://www.aarp.org/health/medicare-insurance/info-2017/choosing-medicare-plan.html

AARP. “10 Questions to Ask When Selecting a Medicare Plan.” (accessed October 6, 2018) https://www.aarp.org/health/medicare-insurance/info-01-2011/understanding_medicare_your_checklist.html

U.S. Centers for Medicare & Medicaid Services. “Your Medicare coverage choices.” (accessed October 6, 2018) https://www.medicare.gov/what-medicare-covers/your-medicare-coverage-choices

How Many Days Will Medicare Pay for a Nursing Home Stay?

“Original Medicare will pay a portion of your costs to receive skilled nursing care at a qualifying facility for a limited number of days.”

Medicare has limited coverage for nursing home care, and even if you qualify, they will only help pay for a short stay. If you find yourself in need of nursing home care, it will help to know how many days will Medicare pay for a nursing home stay?

How Many Days of Medicare Nursing Home Coverage Do You Have?

Original Medicare will pay a portion of your costs to receive skilled nursing care at a qualifying facility for a few days. The amount Medicare covers will vary by the number of days you need the services, within a benefit period. Medicare pays:

• All of your costs of skilled nursing care for the first 20 days of each benefit period.
• All but $167.50 per day for Days 21 – 100 per benefit period. You must pay the coinsurance amount of $167.50 a day for these days.
• After Day 100 of care within each benefit period, Medicare pays nothing for your skilled nursing care. You must bear these costs yourself.

What Are the Requirements for Medicare Coverage of Nursing Home Care?

Medicare makes you jump through multiple hoops to get any benefits for staying in a qualifying nursing facility. These requirements include:

• You have Part A coverage.
• You have not used all of your allotted days in your benefit period.
• You had a qualifying hospital stay (three or more days inpatient at a hospital).
• Your doctor certifies that you need daily skilled nursing care.
• You use a Medicare-approved skilled nursing facility.
• Your medical condition is hospital-related.

Medicare and Standard Nursing Home Care

If you need only custodial care, Medicare will not help pay anything for your stay in a nursing home. Custodial care is when people need help with activities of daily living, such as bathing, dressing, and eating. Medicare will only pay, if you need skilled nursing care, like changing sterile dressings. If Medicare determines that it is not medically necessary for you to have help with your care, they will not pay for it.

What is a Certified Skilled Nursing Facility?

Even if you satisfy the requirement that your skilled nursing care is medically necessary, Medicare will only pay for your brief stay at a skilled nursing facility (SNF) that meets Medicare’s certification process. If the place where you receive your care is not a certified SNF, Medicare will not pay.

What Does Medicare Cover at an SNF?

For the short time Medicare allows you to stay at an SNF, they will help pay for these services:

• A semi-private room (shared with at least one other patient)
• Food
• Skilled nursing care
• Services to meet the approved health goal of your stay at the SNF, which might include physical therapy, occupational therapy, and speech-language pathology services.
• Drugs
• The supplies and equipment used for your care while you were an inpatient in the SNF.

What is a Benefit Period?

Medicare starts the clock over on your SNF coverage for each benefit period, and you have an unlimited number of benefit periods. The day you become an inpatient at a hospital or SNF, a new benefit period begins. It ends when you go for 60 days in a row, receiving no inpatient hospital care or SNF care.

This article discusses the general law, and your state might have different regulations. Talk with an elder law attorney in your area.

References:

Centers for Medicare & Medicaid Services. “Medicare Part A coverage – nursing home care.” (accessed June 14, 2018) https://www.medicare.gov/what-medicare-covers/part-a/part-a-coverage-nursing-home-care.html

Planning for Your Third Act? Better Understand the Things Medicare DOESN'T Pay For

If you need a type of healthcare that Medicare does not pay for, you will either have to carry another insurance plan that pays for it or pay for it out of pocket.”

Jane Fonda has a habit of shaking things up. When she spoke about life’s third act at a TED talk, she did not disappoint. If you also view the last three decades of life as a significant developmental stage in which you can succeed in whatever you pursue, whether in art, science, literature, or another field, you do not want to be held back by health issues or stifling medical bills. Therefore, are you planning for your Third Act? It is important to understand the things that Medicare DOESN’T pay for.

How the Items on This List Can Affect Your Enjoyment of Life

If you need a type of healthcare that original Medicare does not pay for, you must either carry another insurance plan that covers it or pay for it out of pocket. Forbes says that Medicare will only cover about half of your medical expenses in retirement.

If you must spend a significant portion of your fixed income in retirement on medical expenses, you will not have that money to do the things that can bring you joy, like traveling or visiting your grandkids. You might not afford the things that make life comfortable, like keeping the thermostat set where you are neither too hot nor too cold, buying nutritious food or replacing worn coats, shoes, and clothing.

The Uncovered Eight

There are eight categories of services and items Medicare will not pay for, that you must pay for through other coverage or pay out-of-pocket. These are:

1. Long-term care, also called standard nursing home care or custodial care. Nursing home expenses can gobble up your life savings within a year or two. Custodial care is one of the most sizeable costs a person can face. Medicare will cover medically-necessary skilled nursing care for a short period. However, it does not cover standard nursing home care. Medicaid pays the expenses of more nursing home residents than any other single payer.
2. Eye exams for getting prescription glasses. Medicare does not help pay for these exams, but they will cover medical procedures for the eyes.
3. Dental care. Medicare does not pay for most dental care.
4. Dentures. If you lose your teeth because Medicare refused to pay for your dental care, the harm is compounded because Medicare will also not cover the cost of your dentures.
5. Hearing aids and fitting exams. Hearing aids are expensive, but Medicare will not pay for either the devices or exams for fitting them.
6. Foot care. Many people experience problems with their feet as they age. Unfortunately, Medicare will not help you with the cost of routine foot care.
7. Acupuncture is a minimally-invasive treatment that can bring pain relief for many people, but Medicare will not pay for it.
8. Cosmetic surgery rounds off the list of the eight things Medicare does not cover.

Caveats: Even when Medicare pays for healthcare, you must still pay your premiums (usually nothing for Part A, but most people must pay Part B premiums), deductible, coinsurance, and copayments.

The information in this posting is general law. The law in your state may be different, and there may be other programs available where you live. Talk with an elder law attorney in your area.

References:

Forbes. “What Medicare Doesn’t Cover: A Preretiree’s Guide.” (accessed January 16, 2018) https://www.forbes.com/sites/nextavenue/2014/09/18/what-medicare-doesnt-cover-a-preretirees-guide/#1c1d4bee36ae

Centers for Medicare & Medicaid Services. “What Part A & Part B doesn’t cover.” (accessed January 16, 2018) https://www.medicare.gov/what-medicare-covers/not-covered/item-and-services-not-covered-by-part-a-and-b.html

TED. “Life’s third act: Jane Fonda.” (accessed January 16, 2018) https://www.ted.com/talks/jane_fonda_life_s_third_act#t-65423

What Changes Can You Expect to Medicare in 2018?

“The Part D (prescription drug) coverage may be going down in some plans in 2018, but you should be careful, read your entire plan and ask questions, until you are comfortable that you understand it.”

Medicare premiums and coverage details can change every year. Medical expenses and insurance premiums can make up a significant portion of your monthly costs. If you have Medicare coverage and you want to know how to plan your budget, you may be asking, What changes can you expect to Medicare in 2018?

New Medicare Cards

Your old-school Medicare card had your Social Security number printed on it, which was great – for identity thieves. You will now get a new Medicare card that does not have your Social Security number on it. Instead, you will have a Medicare number that is unique to you. It is similar to an account number. Medicare will mail out the new cards between April 2018 and April 2019. If you have moved, you must update your mailing address with Medicare at ssa.gov/my account or by calling 1-800-772-1213. The TTY line is 1-800-325-0778.

More Out of Pocket Costs

If you have a Medicare Advantage (MA) plan, you previously might have had a limit on out-of-pocket expenses you had to pay for Part A (hospital insurance) and Part B (outpatient coverage).  Many of the MA plans that offer $4,000 or less a year as the out-of-pocket maximum will no longer exist in 2018. There will still be quite a few MA plans with $0 monthly premiums, and you can still include dental, vision, and hearing coverage into your MA plan. Original Medicare has no cap on out-of-pocket expenses and does not allow you to roll the additional coverage options into your plan.

Higher Part B Surcharges

From 2015 to 2020, federal legislation is phasing in higher reimbursements to doctors who take Medicare patients. The money to pay the physicians more comes from the Medicare patients. Medicare calls this a “Part B surcharge.” The amount you pay is based on your income. The monthly surcharges range from $134 to $428.60. While these amounts have not increased, they played around with the income brackets so people who used to be in one income bracket, will now be in a different bracket and pay a higher surcharge.

In 2017, the brackets were:

• Less than $85,001 single/$170,001 married: paid $134/month surcharge
• $85,001 to $107,000 single/ $170,001 to $214,000 married: paid $187.50/month surcharge
• $107,001 to $160,000 single/ $214,001 to $320,000 married: paid $267.90/month surcharge
• $160,001 to $214,000 single/ $320,001 to $428,000 married: paid $348.30/month surcharge
• More than $214,000 single/ $428,000 married: paid $428.60/month surcharge

The income brackets for 2018 will be:

• Less than $85,001 single/$170,001 married: NO CHANGE
• $85,001 to $107,000 single/$170,001 to $214,000 married: NO CHANGE
• The previous $107,001 to $160,000 single/$214,001 to $320,000 married bracket is now divided into two new brackets that will pay either $267.90 or $348.30 in monthly surcharge
• Everyone making over $160,000 single/$320,000 married will pay the maximum surcharge of $428.60 a month

Some Premiums Changing

The Part D (prescription drug) coverage may be going down in some plans in 2018, but be careful, read your entire plan and ask questions until you are comfortable that you understand it. Some people will be happy to see that their Part B (outpatient services) premiums will not increase in 2018. Other Medicare participants will see their 2018 Part B premiums increasing by 2 percent.

Laws can vary from state to state, and this posting discusses the general law. Talk with an elder law attorney in your area.

References:

MedicareResources.org. “How are Medicare benefits changing in 2018?” (accessed November 6, 2017) https://www.medicareresources.org/faqs/what-kind-of-medicare-benefit-changes-can-i-expect-this-year/

Centers for Medicare & Medicaid Services. “Medicare & You 2018.” (accessed November 6, 2017) https://www.medicare.gov/pubs/pdf/10050-Medicare-and-You.pdf

The Motley Fool. “3 Changes to Medicare in 2018 That You Need to Know.” (accessed November 6, 2017) https://www.fool.com/retirement/2017/10/08/3-changes-to-medicare-in-2018-that-you-need-to-kno.aspx

I Have Medical Coverage, Can I also get Medicare?

“Even if you have employer medical coverage, you can be penalized for late enrollment, if you do not sign up for Medicare when you are supposed to.”

As you approach the age of 65, you may be looking for ways to downsize and cut your monthly expenses. Your monthly health insurance premium is a sizeable monthly cost. It would be nice if you could go on Medicare and not have to continue paying your health insurance premiums. You may also be interested in carrying both your medical coverage and have Medicare. This article answers the question you may be asking, “I have medical coverage, can I get Medicare too?”

It is a simple question, but the answer is, unfortunately, not so simple. It will depend on three factors:

1. Your age
2. Whether you have a disability
3. The size of your employer

Often, it is not an issue of whether you may have both your employer coverage and Medicare. Even if you have employer medical coverage, you can be penalized for late enrollment, if you do not sign up for Medicare when supposed to.

Under age 65

If you are under age 65 and have employer coverage, and you have not received Social Security benefits for at least four months before you become 65, you must sign up for Parts A and B of Medicare. Part A is hospital insurance, and is usually free. Part B is medical insurance, which requires that you pay a monthly premium, whether you use it or not.

If your employer has fewer than 20 employees, you must enroll in Medicare Parts A and B when you are eligible, to avoid a gap in coverage and a late enrollment penalty. If you do not sign up for Parts A and B when you are supposed to, you may have a late enrollment penalty tacked on to your premiums for the rest of your life.

If your employer has 20 or more employees, check with your HR or benefits manager to see if your coverage meets the IRS requirements for “group health plan coverage.” If it does, you might hold off on enrolling in both Parts A and B and avoid the late enrollment penalty.

Over age 65

If you are over age 65 and you did not enroll when you were first eligible, you cannot go back and reset the clock. When you eventually retire or lose employer coverage, and then sign up for Medicare, you may have to pay a penalty, depending on the size of your employer.

Under age 65 with a disability

Similar to being over age 65 but not yet on Medicare, you must enroll when you eventually retire or lose employer coverage. The number of employees your employer has, will determine whether you must pay a late enrollment penalty when you enroll in Medicare.

With some disabilities, however, enrolling in Part B is optional if you qualify for Part A. There is also no late enrollment penalty when you enroll eventually. You can even have your late enrollment penalty removed, if you are later diagnosed with a qualifying disability.

The rules for Medicare are complicated, and they can change. If you make a mistake, it could cost you higher premiums for the rest of your life. The laws are different in every state, so check with an elder law attorney in your area.

References:

U.S. Centers for Medicare & Medicaid Services. “I have employer coverage.” (accessed August 2, 2017) https://www.medicare.gov/sign-up-change-plans/get-parts-a-and-b/employer-coverage/i-have-employer-coverage.html#collapse-5569

Signing up for Medicare as an Elder – What You Need to Know

US citizens become eligible for Medicare when they turn 65. If you are months away from your 65^th birthday, it’s best to get started on your Medicare application. Here’s what you should know about Medicare:

Types of Medicare

There are four types of Medicare:

• Part A covers inpatient services in hospitals and nursing facilities
• Part B covers doctor services, outpatient services, preventive services and medical supplies
• Part C is offered by medical insurance companies that contract with Medicare to provide all Part A and Part B benefits in a single plan, in addition to extra services such as dental and vision care. Sometimes, it may even cover prescription medication.
• Part D covers prescription medication.

When Does Enrollment Begin?

Enrollment for Medicare begins as you approach your 65th birthday. It lasts seven months split into three months before the month of your birthday and three months afterward. For example, if you are to turn 65 on 1 January 2018, enrollment begins on 1 October 2017 and ends on 30 April 2018.

How Do I Enroll in Medicare?

If you already receive Social Security benefits or Railroad Retirement pay, you do not need to enroll in Medicare since it happens automatically (for Part A and B) on the first day of the month of your 65^th birthday. You should receive your Medicare card in the mail, three months prior to your birthday.

If you are approaching 65 and you are not getting social security or railroad retirement pay, you should enroll in Medicare. You can do this by either calling Social Security at 800-772-1213 or by visiting a local Social Security office.

If you are actively employed and your employer offers health insurance coverage (COBRA coverage and VA benefits do not count), you may not have to apply for Part B coverage immediately. You may want to consult with an elder law attorney to determine if it would be reasonable to delay enrollment in the coverage.

Payments for Part B Medicare

Every person pays for Part B Medicare insurance. The funds are usually deducted from your Social Security payments.

Premiums are calculated every year. The 2017 standard premium was $134. However, many people pay less after cost-of-living adjustments. Premiums may be higher for people with high incomes and for people who did not enroll when they were eligible to do so.

Medicare Part C Coverage

Insurance companies contract with Medicare to provide seniors with Part A and B coverage in a single plan. These plans are also called Medicare Advantage plans. These plans may also cover medication and dental, vision and wellness care.

Medicare Part D

If you do not have Part C cover that’s inclusive of medication, you should enroll for Part A, B and D coverage. When you delay enrollment in Part D, you risk paying 1 percent higher premiums for every month you were eligible to enroll but delayed.

What is a Medigap policy?

Because of its numerous deductibles, coverage exclusions, and copayments, Medicare often only pays for 50 percent of all seniors’ medical costs. The balance can be settled by private insurers offering Medigap policies to cover the gaps not covered by Medicare. You can check local insurers to see if they offer a Medigap policy.

References:
“Turning 65? What You Need to Know about Signing up for Medicare”
“Enrolling in Medicare”
“What's Medicare?”
“Ready to Join Medicare?”

Retirement’s Big Unknown

“It’s up to us today to be actively funding our future selves.”

The greatest unknown in retirement is your health. Two of the most critical investments that we can make now are to plan to cover uncertain costs and live healthy. Forbes’ article, “The Biggest Wild Card In Retirement And How To Deal With It,” notes that if a married couple retiring at age 65 wants to have 90% certainty that they can cover healthcare expenses in retirement (Medicare Part B and Part D premiums, MediGap premiums, and out-of-pocket drug expenses), they’ll need $265,000 (with high drug expenses upping it to $349,000). These numbers don’t include long-term care expenses. They can be as much as $10,000 a month.

Medicare won’t cover everything, so you’ll probably need MediGap coverage. You should also look out for Medicare premium surcharges, if your income is over $85,000 ($170,000 for joint filers). People say that “health” is the key to a happy retirement, but research shows that it’s also the biggest concern. Americans of all ages say that their top financial worry in retirement is that they or a loved one will have a costly health issue. Nonetheless, there’s a bit of a disconnect even among those who are aware of this cost. Healthcare costs are frequently missing in retirement planning, research says. Fewer than 15% of pre-retirees have ever attempted to estimate the amount of money they might need for health care and long-term care in retirement.  Only 42% of pre-retirees have a health care directive that details the individual who’ll determine how medical care is carried out, if a spouse is unable to make decisions on their own.

There is some positive news. In a recent study, 91% of retirees said they’re willing to make healthier choices now to save money later, and 83% say they’ll review their health insurance plan options. With that in mind, there are some steps you can take right now. Starting a general retirement account can help cover extra health care costs. You should take full advantage of tax-advantaged retirement plans and up your savings.  You should also investigate if your employer has any specialized tax-advantaged healthcare savings options.

Look into a HSA or FSA. If you have a high deductible health insurance plan, you can save in a tax-advantaged health savings account (HSA). If you don’t use the money for current out-of-pocket healthcare expenses, you can invest it and save it as a retirement healthcare fund. In addition, a Healthcare Flexible Spending Account (FSA) helps cut costs on current year healthcare expenses.  Some plans allow you to carry over a $500 balance into the next plan year.

Long-term care insurance.  Only 30% of people believe they’ll need long-term care, but it’s really more than double that number. Seven in ten will need it at some point in their lifetimes and on average, they will need it for approximately three years. If you don’t want to purchase long-term care insurance, you’ll need to be certain that you’ll have resources available, in case care is needed.

Talk to the whole family. Talking money still may be thought of as off-limits, but it shouldn’t be. About 70% of married pre-retirees haven’t discussed healthcare in retirement and how to pay for it with their spouses. The study also found 70% of Americans haven’t had serious conversations about net worth, long-term care, or wills and inheritance with their parents.

Reference: Forbes (February 16, 2017) “The Biggest Wild Card In Retirement And How To Deal With It”