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

MEDICARE ONLY: You will be responsible for the Part A hospital deductible ($1,100 ). You will pay the Part B deductible ($155). You will be responsible for 20% of the cost 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.   The Medicare Part B premium is $110.50 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. 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.  I always say, “think FULLEST 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 F offers the fullest coverage, it has the highest monthly premium.  Plans M and N are new in June.  Plan N is very much like Plan F except you will pay a $20 co-pay for doctor appointments, $50 for an emergency room visit, and $155 for the Part B deductible. Because of these co-pays, the monthly premium for Plan N is generally 25% less than Plan F.

Medigap plans in Arizona cost between $85 per month for Plan N and $129 per month for plan F.  A Plan F is exactly the same from company to company, except that the premium will differ from company to company.

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 ($96.40 or $110.50/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.

Almost half of all Medicare beneficiaries in Maricopa, Pinal, and Pima counties are enrolled in these private Medicare plans. People like them because they usually include a Part D drug plan. Most have a monthly premium between $0 and $60.  The premium is low because these plans almost always involve a local network (HMO or PPO) – and because Medicare pays a lot of money to the insurance companies to provide your Medicare coverage.  Most Advantage plans offer free gym memberships.

Most Medicare Advantage plans have a network of doctors and hospitals, and you must stay in the network.  Most Advantage plans are HMO’s which require you to have a primary care physician who gives you referrals to specialists. Most plans will require you to get prior authorization for certain tests, treatments, and hospitalization (except in an emergency situation).  If you do not follow all the rules, bills will not be paid by the plan.  Each MA company has different co-pays, rules, and networks – though many doctors are contracted with multiple MA plans.

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.  In Pima county there are 46 Part D plans to choose from and each has a different monthly premium and a different formulary (list of drugs covered).

Part D premiums range from $17 to $70 per month.  Before signing up for a plan, you need to be sure your drugs are covered by that plan and what your co-payment will be.  If you are enrolling in a Medicare Advantage plan, Part D usually comes with the plan.  But you still must make sure all your drugs are covered and what your co-pay will be.

FOR MORE INFORMATION ON YOUR MEDICARE CHOICES, CHECK OUT THIS VIDEO, “AN INTRODUCTION TO YOUR MEDICARE CHOICES“.

PS:  If you are working for a large employer and have group health insurance, you won’t need to use your Medicare or pay the Part B premium.  Your employer must keep you and your spouse on the group health plan.

This video presentation explains your Medicare choices. Click on the title to see the video.

And one more bit of good news is that this company’s Medicare Supplement rates are the among the lowest in Arizona – and the company is a top-rated, well-known insurance company.

Plan N is a new Medicare Supplement that went into effect on June 1st.  This plan costs about 25% less than Plan F, which is a Medicare Supplement that fills all the gaps in Medicare.  Plan N costs less because it will require seniors to pay $20 co-pays when they see a doctor in the doctor’s office.  Seniors will also pay $50 if they go to the emergency room. Additionally, the Part B deductible ($155) is not covered by Plan N, and the plan does not cover excess charges (which very few doctors charge anyway).  Every other service (hospital stays, labs, physical therapy, chemotherapy, radiation treatment) is covered completely beyond the co-pays mentioned here.  Medicare pays its part of the bill and Plan N will pay the balance.

I asked this company representative how long they will continue their open application policy for Plan N.  I was told they have no plans to change it in the next few months.  Hopefully the policy will continue through the end of the year when Medicare Advantage enrollees will be able to get out of their plans, go back to Medicare, and get a Medicare Supplement.  Plan N might be the only option for people who might not pass the health questions required by most Medicare Supplement companies. Hopefully they will still have a chance to get Plan N with no questions asked by this company.

I would name the company here, but they would see this as advertising rather than a news story. So I am unable to use the company’s name in this post.

NOTE: When you turn 65, or when you first get Part B, you have a six month “guaranteed issue period” during which you can sign up for a Medicare Supplement without answering medical questions. This is very important for people with pre-existing conditions because they cannot  be refused a Medicare Supplement during their guaranteed issue period.

CONTACT DENISE TO GET MORE INFORMATION  AT 520-820-8639.

A MOOP is a cap on expenses for co-pays and co-insurance, and the maximum limit is expected to be $6,700.  However, CMS (Centers for Medicare and Medicaid) encourages Advantage plans to have lower MOOPs and will reward plans that voluntarily cap members’ expenses at a lower amount, such as $3,400.

A MOOP is important when someone has a chronic illness or multiple hospitalizations during a given year. Co-pays for specialists ($35-$45 for each visit), co-pays for MRIs ($150), and hospitalization at $200 per day, can add up. So Medicare is going to require every Advantage plan to set a cap for its members’ annual co-pays.

Cancer is an illness that requires large co-pays for chemo and radiation treatment (20% of the bill) and can quickly add up to five or even ten thousand dollars.  An Advantage plan with a MOOP of $3,400 means that after the member has paid this amount “out of his own pocket”, he will have no more co-payments or co-insurance for the rest of the year. (Some plans have a MOOP but still require co-pays for doctor visits and labs after the MOOP is met.)

The Medicare Advantage plan with the largest enrollment in Tucson (over 28,000 members) does not have a MOOP. I recently got a call from a woman whose mother-in-law is in this plan and is being treated for breast cancer.  The co-pay for chemotherapy under every Medicare Advantage plan in Tucson is 20% of the bill.   So a person enrolled in a plan with a $3,400 MOOP would have their chemo cost capped at $3,400 through the end of the year.  A person in a plan with a $5,000 MOOP will stop paying at $5,000.  A person in a plan with no MOOP can only wait and see what their total bill will be.  I have heard of people whose 20% co-pay was $10,000.

Please see my post from last fall in which I compared the benefits and costs of 2010 Advantage plans in southern Arizona. I addressed the MOOP for several plans.

LOWEST MOOP:  Health Net has introduced a $3,400 MOOP for all of its Ruby plans. Universal also has a $3,400 MOOP.

NO MOOP: Secure Horizon Medicare Complete Plan 1 has no MOOP.  CareMore plans have no MOOP.

For many years (and in 2010), people enrolled in Medicare Advantage plans were able to switch from one plan to another during the months of January, February, and March.  This “Open Enrollment Period” will not be available in 2011.

In November this year (2010), it will be very important for seniors to review the materials they receive from their Medicare Advantage plan – in case their plan makes some big changes.  If they want to shop around for another Advantage plan, they will only have November 15th to December 31st to do so.  If they discover in January that their plan no longer works for them, they will be unable to change to another Advantage plan. Their only recourse will be to dis-enroll from their Advantage plan and go back to Medicare (and pick up a Part D plan).

This past January, February and March, quite a few seniors realized their Health Net plan had introduced a $36 monthly premium.  Several thousand people did not realize this until the company sent them a coupon book at the very end of December. Everyone had  received an Annual Notice of Change at the end of October, but many people had not read the mail from their plan.  Health Net sent out a letter in January warning people that they would be dropped if they did not pay the monthly premium – and shocked folks into action. These people had the opportunity during the first three months of the year to shop around and change to another Advantage plan.  They will not have the same option in 2011.

I also heard from a number of people who did not realize until the new year that their Advantage plan was no longer covering one of their drugs.  They had missed the notification that had been sent to them at the end of October (as required by Medicare) and when they went to refill their prescriptions in January or February, the pharmacy informed them that their plan no longer covered the drug.  These seniors were able to change to another Advantage plan in February or March, 2010.  But in 2011, they will be stuck with their Advantage plan.

Things are going to be interesting later this year and early next year.

Click here to view the embedded video.

For a bigger picture, click on the YouTube logo in the lower right hand corner of the screen.

I have written all of these articles to provide you with information about the many changes that will affect Medicare and Medicare Advantage plans in 2010 and 2011.

I can help you get all the information you need to make an informed decision about your Medicare coverage. I represent Medicare Supplement providers and all the Medicare Advantage plans in southern Arizona, so I can help you select the coverage that best suits your needs. 

Call  520-820-8639 for Medicare Choices of Arizona

MOOP:  annual Maximum-Out-Of-Pocket, or a cap to your co-pays each calendar year. This is important if you get cancer, because your 20% co-pay for chemo and radiation therapy will add up quickly.  Other chronic illnesses will also mean many co-pays that can add up.

HOSPITAL CO-PAY:  Your hospital co-pay can add up to thousands of dollars if you spend ten days or more in the hospital.

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Let’s compare Medicare Advantage plans in southern Arizona that include drug coverage.

LOWEST MOOP:  Health Net has introduced a $3,400 MOOP for all of its Ruby plans. Universal also has a $3,400 MOOP.

NO MOOP:  Secure Horizon Medicare Complete Plan 1 has no MOOP.  CareMore plans have no MOOP.

LOWEST HOSPITAL CO-PAY:  CareMore plans have a $100 per day co-pay for days 1-5. You don’t pay after day 5. 
Health Net Ruby 3 is next with a flat co-pay of $695 per admit.
Humana Gold Plus HMO-POS is next with $195 per day for days 1-7, for a possible 7-day (or 10-day or 20-day) cost of $1,365.

HIGHEST HOSPITAL CO-PAY: Universal’s Any Any Any plan at $300 per day for days 1-7, for a possible cost of $2,100.
Health Net Ruby 1 and 4 are next with $200 per day for days 1-10, for a possible cost of $2,000.  But if you’re in the hospital just two days you’ll pay $400.

PREMIUMS:  Many people look at this first and look no further when they see a premium.  But you should study all the co-pays to see if paying a premium might be worth lower co-pays or extra benefits in the plan.

Secure Horizons HMO plans 1 and 3: $0 premium 
Humana  HMO-POS: $0 premium
Health Net Ruby 4:   $0 premium (but a $265 deductible)
Health Net Ruby 1:   $36/month
Humana local PPO:  $51/month
Health Net Ruby 3:  $59/month premium (includes $1,000 dental and $400 vision benefits)
Universal Gold:   $39/month (This is a private-fee-for-service plan, no network.)
Universal Silver:  $69/month  (private-fee-for-service.)
Humana Regional PPO: $88/ month  (This is very high, but it may be your only choice in some locations.)
Universal PFFS:   $49/month    (This is very high, but it may be your only choice in some locations.)

RIP-OFF PREMIUMS: 
Humana PFFS plan:   $137/month 
Humana Regional PPO: $147/month

Why are these a rip-off?  You can get a Medicare Supplement for these premiums and get much better coverage.  I don’t know how or why these companies are allowed to charge such premiums.  Unfortunately there are hundreds of people who enrolled in these plans several years ago (when the premiums were $0 or $24) who do not realize they can and should switch coverage.  If they can afford to pay $137 per month, they can afford – and should get –  a Medicare Supplement.

ARE YOUR DOCTORS IN THE NETWORK? Another detail that is critical to your review of a plan.  Are the doctors you want to see, and the hospitals you want to use, in the plan network?

DRUG COVERAGE:  Just one more (very important) thing to consider when choosing a Medicare Advantage plan.  The fact that these plans include drug coverage for no premium, or a low premium, makes Medicare Advantage very attractive.  But you must look at what your co-pays will be in any plan you are considering.  An expensive drug you take may be a tier 2 on one plan and a tier 3 on another plan.  This means a co-pay of around $40 for tier 2 versus $70 per month for tier 3.  Or, your expensive drug may not even be on one plan’s formulary. You must look closely at the drug coverage.

So how do you pick a plan?  It depends which benefits are most important to you.

• Do you insist on a $0 premium plan?  Each company offers a $0 premium plan, but you will pay for this with certain co-payments.
• CareMore will have by far the lowest co-pays for hospital stays, doctor visits, diagnostic tests, and outpatient surgery.  But it will have a very limited network this year. 
• If cost is your main concern, CareMore will be your choice.
• If having the possibility to go out-of-network for hospital services, you should look at Humana’s PPO or HMO-POS. 
• Secure Horizons’s Plan 3 is an HMO with no referrals required and the Passport program which allows you to use Secure Horizons contracted doctors across the country.
• Universal’s Any Any Any plan is the only private-fee-for-service (no network) plan that is being actively marketed this year.

 Confused?  You are not alone. Because the plans offer one good benefit, but trade this off against other not-so-good benefits, it is a good idea to discuss the plans with someone who is familiar with all the details. If you are an informed consumer, you will make a good choice for yourself.

During the Open Enrollment Period (January – March) you can change to another Medicare Advantage plan or go back to Original Medicare and pick up a stand-alone Part D  plan.

Humana’s enrollment numbers for its Medicare Advantage plans total about 1,500 in Pima County.  This is far behind Secure Horizons’ 30,000-plus enrollees and Health Net’s 20,000.

People on Medicare can change their Medicare coverage from November 15 to December 31, and the change becomes effective on January 1, 2010.

Humana has spent three years building their doctor and hospital networks in Pima County, and their Medicare Advantage plans may offer strong competition to Secure Horizons and Health Net this year.

Humana will offer the only local or regional PPO (Preferred Provider Organization) in 2010, as Health Net is cancelling its Violet PPO plan.  A PPO has a network of doctors, but allows members to go out-of-network for a higher co-payment.  PPO plans do not require referrals, which are mandatory in most HMO’s (Health Maintenance Organization).

Humana is introducing some out-of-network options for its HMO plans by allowing its members to use out-of-network hospitals across the country for the same co-payments they would pay in Tucson.  This is one way to overcome objections some seniors have to the limitations of local HMO networks.

Humana enrolled thousands of seniors into their PFFS (Private-fee-for-Service) plans in 2006 and 2007. But these plans, with no doctor networks, have proven to be expensive and unpopular with lawmakers in Washington, DC.  Humana raised premiums in 2007, 2008 and 2009, and lost most enrollees in their PFFS plans when the monthly cost went over $90 this year. Instead of cancelling these PFFS plans, Humana raised the plan premiums to discourage people from staying in them. 

Seniors who are thinking about changing their Medicare coverage, or switching Medicare Advantage plans can compare plans on http://medicare.gov web site, or they can talk to an independent insurance agent who represents several plans. The most popular plans in Pima County are Secure Horizons, Health Net, and Humana.

Most Medicare Advantage plans in Pima County are HMO’s which have doctor and hospital networks and require referrals to see specialists.  HMO’s were designed to save Medicare money by controlling costs through managed care.

Regarding Medicare Supplements:

A study conducted in March 2009 found that 88% of seniors are satisfied with their Medicare Supplement plan – with 62% of those surveyed responding that they were very satisfied. 87% of the respondents said they would recommend a Medicare Supplement to a friend.

What  seniors liked most about their Medicare Supplement was:

• They could visit doctors of their choice;
• Supplement policies provided financial security;
• Supplement policies made it easier to deal with medical bills and paperwork.

The high-deductible Plan F is the most popular plan.  Medicare Supplements work along with Original Medicare coverage and are standardized across the country. 

The study was conducted by American Viewpoint, Inc., by the Blue Cross Blue Shield Association (BCBSA), and America’s Health Insurance Plans (AHIP).

(From http://www.ahip.org/content/pressrelease.aspx?docid=27323