CDIS Blog
Whether or not you take prescription drugs, you may want to consider your options carefully when it comes to joining Medicare Part D. Unless you have other, creditable coverage offered through work or a union, going without prescription drug benefits may end up costing you money. Do you have to join Medicare Part D to avoid extra fees? Part D coverage is optional, but without the right guidance, you could end up paying a higher premium from a late enrollment penalty. Here’s some information on Part D coverage and what you should know if you are approaching your Initial Enrollment Period.
How to Avoid the Part D Penalty
Joining Medicare Part D, or prescription drug coverage, is optional. However, joining late may trigger a penalty. How do you avoid the Part D penalty?
Join Part D when you are first eligible, during your Initial Enrollment period.
Maintain creditable coverage (other prescription drug coverage) through an employer, union, or other health insurance provider.
If you do not currently have prescription drug benefits through an employer or other source, the best time to join Medicare Part D is when you are first eligible, during your Initial Enrollment period. Even if you do not need medications now, joining during Initial Enrollment ensures you avoid paying a late enrollment penalty.
Not everyone needs to join Medicare Part D when they are first eligible, and many seniors delay enrollment without paying a penalty. Many employer-provided health insurance plans offer drug coverage that is considered “creditable” by Medicare.
If you do have drug benefits, as long as you are covered, you do not need to join. However, if you lose coverage (employer benefits end or COBRA ends) you only have a certain amount of time to join Part D without penalty.
Your health insurance provider will let you know if your coverage is creditable. Be sure to keep this documentation safe as you will need to show it to Medicare when you are ready to join Part D. Without proof, you may end up paying a late enrollment penalty.
If You are Penalized, Here’s How to Calculate Your Premium
If you go without a Medicare prescription drug plan (Part D) or other creditable coverage for 63 days or more after your Initial Enrollment period ends, you may owe a late enrollment penalty. Penalties are calculated by multiplying the Part D premium amount by the number of full months you went without Part D or creditable drug coverage.
Resources:
Part D Penalty: https://www.medicare.gov/part-d/costs/penalty/part-d-late-enrollment-penalty.html
MUC56-2017-BCBS
CDIS Blog
Prescription drug benefits are often included as part of an employer-provided health insurance plan. If you are one of thousands of seniors relying on coverage through work and expect to use your plan’s drug benefits, do you have ‘creditable coverage’? As a Medicare-eligible policyholder, you have the right to know whether or not your current drug coverage meets the standard Medicare prescription drug coverage, and is considered ‘creditable’.If your current prescription drug benefits are provided through an employer, union, or another source, understanding what ‘creditable coverage’ means and how it applies to you will help you make an informed decision—potentially saving you money. The good news? All companies offering prescription drug coverage are required by law to notify you about the status of benefits and whether or not your drug plan meets or exceeds the standard Medicare Part D Prescription Drug plan.
Creditable Coverage
For prescription drug coverage to be creditable, the plan must expect to pay (on average) as much as the standard Medicare prescription drug coverage. How is this determined?
Creditable coverage does the following:
Provides coverage for brand name and generic prescriptions.
Provides reasonable access to retail providers.
Pays an average of at least 60 percent of a participant’s drug expenses.
Satisfies at least one from below:
No annual benefit maximum.
An expectation is that the amount payable by the plan will be at least 2,000 annually.
For integrated coverage: No more than $250 deductible per year, no annual benefit maximum, and no less than a $1,000,000 lifetime combined benefit maximum.
Why It Matters
Of course, there’s a good reason why it makes sense to maintain creditable prescription drug coverage. Medicare beneficiaries who decide not to sign up for Part D prescription drug coverage when they are first eligible, but enter the program late often have to pay more. People signing up late for Medicare Part D without creditable drug coverage may be subject to a 1 percent monthly premium penalty for late enrollment.
However, if you have drug benefits through an employer—and it’s creditable—you can stay with your current plan instead of enrolling in Medicare Part D and avoid paying higher prices when you do enroll. In other words, as long as your current drug benefits are as good as Medicare, or ‘creditable’, you can continue to use them and will not pay higher prices when you decide to enroll in Part D at a later date.
What You Should Know
As long as you maintain drug coverage through an employer or union, you should receive a notice by mail each September informing you whether or not your coverage is ‘creditable’. Be sure to keep this documentation—you may need it should you decide to move to a Medicare drug plan later.
Resources:
https://www.cms.gov/medicare/prescription-drug-coverage/creditablecoverage/index.html
https://www.cms.gov/medicare/prescription-drug-coverage/creditablecoverage/downloads/whatiscreditablecoverage.pdf
https://www.medicare.gov/forms-help-and-resources/mail-about-medicare/notice-of-creditable-coverage.html
MUC55-2017-BCBS
CDIS Blog
For many seniors, travel is an exciting part of a retirement plan. Whether you’re planning a continuous exploration of faraway lands or a simple one-week trip abroad, foreign travel is a reality for many after leaving the nine-to-five lifestyle behind. But, what about your health care needs? Will your Medicare coverage come with you on your journey? Typically, Original Medicare does not cover health care you receive while traveling outside of the United States. However, some Medicare Supplement plans do.
Foreign Travel Emergency Care
Some plans offer foreign travel coverage—medical benefits as you travel out of the country. The 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa are considered part of the United States—domestic travel, and foreign travel benefits are not necessary. For all other travel outside of the United States, foreign travel emergency care coverage is provided by supplement plans: Plan G, and N. If you purchased Medicare Supplement insurance before 2010, and you have plans E, H, I, or J, your foreign travel benefits will still be valid, even though these plans are no longer offered for sale.
What Is Covered
With any of the above plans, you will have foreign travel emergency care that begins during the first 60 days of your trip. Your supplement plan will pay 80 percent of the billed charges for necessary medical care outside of the U.S. after you pay a $250 deductible. There is a lifetime limit of $50,000 for all foreign travel emergency care. If you’re undecided as to whether or not you should buy coverage, here’s something to think about: Medicare Supplement plans are available with no underwriting only during your Initial Enrollment period. If you think you may be traveling abroad during retirement, you may want to plan by choosing a plan that offers foreign travel benefits.
In Rare Cases, Original Medicare Pays for Foreign Care
Typically, Medicare does not pay for treatment outside of the United States and Medicare Prescription Drug plans do not cover medications purchased abroad. However, in some rare cases, Medicare may pay up to 80 percent for services covered under Original Medicare even while you are out of the country. Note, that foreign hospitals are not required to submit claims to Medicare. More than likely you will need to submit an itemized bill to be reimbursed.
Original Medicare may pay for inpatient care, ambulance services, or dialysis treatment outside of the U.S. if:
You are in the United States when a medical emergency occurs and a foreign hospital is closer than a U.S. hospital.
You are traveling through Canada en route to Alaska and a Canadian hospital is closer than a U.S. hospital.
You are on a ship within territorial waters adjoining lands of the U.S. but within 6 hours of a U.S. port.
You live in the U.S. and have a medical emergency, but a foreign hospital is closer than a U.S. hospital.
Resources:
https://www.medicare.gov/supplement-other-insurance/medigap-and-travel/medigap-and-travel.html
https://www.medicare.gov/coverage/travel-need-health-care-outside-us.html
MUC52-2017-BCBS
CDIS Blog
As a senior age 65 or older, you may be eligible to join a Medicare Advantage plan as an alternative to Original Medicare. A smart, sensible way to get the coverage you need. As long as you live in the plan’s service area, and are enrolled in Medicare Parts A and B, there are times throughout the year when you can enroll. Here is some important enrollment information that can help.
When to Apply
Typically, you can only join a Medicare Advantage plan during certain times throughout the year. Medicare Part C Enrollment periods were created to make it easy for people to get the coverage they need. However, outside of these periods, Medicare often requires that you stay with the plan you have until the following year. Of course, there are exceptions and in some cases, you may apply outside of designated enrollment periods.
It can be confusing with all the different enrollment periods. The good news is, that once you familiarize yourself with the details, it’s easier than ever to secure comprehensive and affordable coverage. Here is a convenient breakdown of each enrollment period.
Initial Enrollment Period
The best time to apply for Medicare Part C is during your Initial Enrollment period, or when you are first eligible to receive Medicare. Every senior has an Initial Enrollment period that begins 3 months before you turn 65 and ends three months after. If you are disabled, your Initial Enrollment period begins 3 months before your 25th month of benefits and ends 3 months after your 25th month of benefits.
Annual Enrollment Period
Once you join Medicare, you can apply for Medicare Part C during Annual Enrollment, which is October 15 through December 7 of each year. During this time, anyone can join, switch, or drop a Medicare Advantage plan. Remember, if you miss the December 7 deadline, you may have to wait until the following year to purchase Medicare Advantage unless you qualify for a special enrollment period.
Special Enrollment Period
Medicare realizes that some situations make it challenging to meet enrollment periods. Special enrollment periods were created to give all seniors the same opportunity.
If you meet one of the following conditions, you may qualify for a special enrollment period:
Change in Residence Moving out of your current plan’s service area or in or out of a nursing home
Lose Your Current Coverage Losing employer-provided coverage or no longer eligible for Medicaid or Extra Help
Your Plan Changes The Current plan is terminated by Medicare
Special enrollment period: https://www.medicare.gov/sign-up-change-plans/when-can-i-join-a-health-or-drug-plan/special-circumstances/join-plan-special-circumstances.html#collapse-3193
Initial enrollment and Annual enrollment period: https://www.medicare.gov/sign-up-change-plans/when-can-i-join-a-health-or-drug-plan/when-can-i-join-a-health-or-drug-plan.html#collapse-3190
General information: https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/medicare-advantage-plans/medicare-advantage-plans.html
MUC44-2017-BCBS
CDIS Blog
If you’ve overheard your friends talking about their Medicare Advantage plan and would like to know more, you’re not alone. Medicare Advantage also called “Part C”, is a popular choice because it provides seniors with coverage beyond Original Medicare. Medicare Advantage plans include Health Maintenance Organizations, Preferred Provider Organizations, Private Fee-for-Service Plans, Special Needs Plans, and Medicare Medical Savings Account Plans. Cost, coverage, and rules for how you receive services vary from plan to plan, and comparing each type is a smart way to secure coverage that fits your needs.
Different Types
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Health Maintenance Organizations (HMOs)
An HMO plan typically requires that you select a primary care doctor from the plan’s network of providers. In most cases, you’re required to use doctors, health care providers, and hospitals within the plan’s network, except in an emergency. You may need a referral to see a specialist. Compared to other plans, an HMO can be a cost-effective option, but you may pay the full cost of care if you do not follow the plan’s rules. Prescription drug coverage is usually covered but individual plans vary.
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Preferred Provider Organizations (PPOs)
PPOs tend to be less restrictive than HMOs, but increased flexibility can cost you more. You do have the option to use any doctor, specialist, or hospital you choose, but you will pay less if you stay within the plan’s network. A referral is generally not required to see a specialist. Prescription drug coverage is often covered, but individual plans vary.
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Private Fee for Service Plans (PFFSs)
With a PFFS plan, the plan decides how much it will pay doctors and hospitals, and how much you will If the plan has a network of providers, you don’t need to go to doctors or hospitals on the list. However, not all Medicare providers accept the PFFS plan—an important fact to know. Typically, with a PFFS plan, you do not need to get a referral to see a specialist. Prescription drug coverage may be covered, but individual plans vary.
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Special Needs Plans (SNPs)
Membership in an SNP is limited to people with specific diseases or who have specialized health needs. If you have a severe chronic condition, live in a nursing home, or receive both Medicare and Medicaid, you may be eligible. Benefits are tailored to meet the needs of the groups they serve and care is often limited to doctors and hospitals in the plan’s network. You may need a referral to see a specialist. All SNPs must provide Medicare prescription drug coverage.
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Medicare Medical Savings Account Plans (MSAs)
Similar to a Health Savings Account Plan, Medicare Medical Savings Account Plans are plans designed to create more flexibility in choosing healthcare services and providers. Typically, with an MSA, a high-deductible health plan is combined with a savings account. Medicare deposits money into the account, which you use to pay for your health care services for the year. MSAs do not cover Medicare Part D prescription drugs. If you need coverage, you will need to join a Medicare prescription drug plan.
Making Sense of Different Plans
Understanding the differences between the various types of Medicare Advantage plans will help you make an informed decision. Factors like cost, referrals, and whether or not you can use doctors outside a plan’s network vary greatly—but can significantly impact your ability to receive affordable, timely care.
When comparing plans, be sure to think about the type of health care you need and how often you visit your doctor. While cost is a big consideration, it should not be the deciding factor.
References:
https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/different-types-of-medicare-health-plans-.html
https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/medicare-advantage-plans/types-of-medicare-advantage-plans.html
HMO: https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/medicare-advantage-plans/hmo-plans.html
PPO: https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/medicare-advantage-plans/preferred-provider-organization-plans.html
PFFS: https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/medicare-advantage-plans/private-fee-for-service-plans.html
SNP: https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/medicare-advantage-plans/special-needs-plans.html
MSA: https://www.medicare.gov/sign-up-change-plans/medicare-health-plans/medicare-savings-accounts/medical-savings-account-plans.html
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