Health insurance is an empty promise if your doctor or hospital is not covered. Headlines keep on reminding us that insurance companies are restricting the doctors and hospitals covered by their plans. People covered by Medicare have their own separate rules and these Medicare-specific rules have both good news and bad news—but mostly good news.
The good news—people covered by “original” Medicare have broad access to the doctor of their choice. Over 90% of doctors take Medicare. The bad news: the Medicare rules are complicated and are filled with traps for the unwary.
This blog post will be the first in a series to discuss Medicare coverage.
People covered by Medicare can be divided into two groups:
- People who have “original” Medicare—where the federal government acts as the insurer, collecting monthly premiums and reimbursing providers under Part A (Hospital Insurance) and Part B (Medical Insurance, such as physician services), and
- People who choose to participate in a Medicare Advantage plan—where a private insurance company provides coverage for hospitalization and medical costs (and may also cover prescription drugs).
If you are in a Medicare Advantage plan the insurance company determines which hospitals and doctors will be covered—and you can be surprised by how much the insurance company limits your choices. We will discuss the limits of choice under Medicare Advantage plans in a later blog post.
If you are in original Medicare, you may buy Medicare Supplement insurance to help pay for hospital and medical costs not covered by Parts A and B.
The rest of this post will discuss the (essentially) unlimited choices available if you choose to be covered by original Medicare.
Original Medicare and Providers’ Choices
Virtually all hospitals accept original Medicare. Period. It is always worth checking—and certain specialty, for-profit hospitals (especially psychiatric hospitals) may not accept Medicare Part A—but they are a very distinct minority.
Physicians are in a different structure—a doctor can choose to (1) participate in Medicare and accept “Medicare assignment” (the best deal for you), (2) elect not to participate in Medicare, but do not fully opt-out (which costs you some more than going to a physician who accepts assignment, and (3) completely opt out of Medicare (the worst deal for you).
Here is what these terms really mean:
|Doctor’s Status||Participate/Accepting Assignment||Not Participating in Medicare||Opt-out|
|What Your Doctor Can Charge You||
Your doctor agrees to use the fee schedule established by Medicare for services and will only charge you the Medicare deductible ($166 in 2016) and coinsurance amounts (20% of the Medicare fee schedule).
Your doctor may choose (on a service-by-service basis) to charge you higher fees– but this fee cannot be more than 15% over Medicare’s fee schedule.
|Your doctor can charge you any fee he or she chooses.|
|What You Will Have to Pay||Your doctor will not bill you any additional amounts, even if the doctor charges other (non-Medicare) patients more than the amount permitted by Medicare (called “balance billing”)||
You are responsible for the portion of the doctor’s charges in excess of Medicare’s assigned rate (in addition to the standard Medicare coinsurance and deductibles)–but this cannot be more than 15% over Medicare’s fee schedule.
|Medicare does not provide any reimbursement—either to the doctor or to you—so you are responsible for the entire cost of any services you receive|
|Who Bills Medicare||
The doctor will submit the bill directly to Medicare and will usually wait for Medicare to pay its share before asking you to pay your share.
The doctor may not collect reimbursement from Medicare; rather, they bill you directly (usually at the time of service).
The doctor must submit claims to Medicare on your behalf, but Medicare reimburses you directly for its portion of the covered charges.
|The doctor bills you– neither the doctor nor you can bill Medicare|
|Impact on Medicare supplement Coverage||
Medicare Supplement insurance plans will pay some or all of your deductible.
Some plans (Plan C and Plan F) will also pay your 20% coinsurance)
Medicare Supplement insurance plans will pay some or all your deductible.
Only two types of plans (Plans F and G) will pay any of your doctor’s charges above the Medicare schedule
|Medicare Supplement insurance will not provide any coverage for doctors who have opted out of Medicare|
A Warning—and Where to Learn More
You should check directly with your doctor to learn their status under Medicare. This is especially important because some doctors who accept Medicare for current patients are not accepting new Medicare patients.
Also, Medicare maintains a web site (called Physician Compare) that allows you to check your doctor’s status under Medicare. But again, to be safe, you should check directly with your doctor.
Next: Medicare Advantage—I have to go where?
 Henry J. Kaiser Foundation, Primary Care Physicians Accepting Medicare: A Snapshot (October, 2015)
What is Medicare Advantage (Medicare Plan C)? What do consumers need to know to make informed choices about Medicare Advantage plans?
When turning 65, new Medicare beneficiaries are faced with a dizzying array of choices. First, their eligibility for Plan A (hospital) is established. Second, they make the decision to accept Plan B (doctors). At this point in the decision process, there are a host of complex Medicare insurance choices that will have a financial impact on the consumer. These important choices will determine the consumer’s access to and delivery of health care. For all new beneficiaries, the next decision is which of two pathways to follow: stay with Original Medicare, or shop for a Medicare Advantage plan.
What is Medicare Advantage? According to the Center for Medicare and Medicaid Services (CMS), a Medicare Advantage plan is a type of Medicare health plan offered by a private company that contracts with Medicare to provide consumers with all Part A and Part B benefits. Medicare Advantage plans include Health Maintenance Organizations (HMO), Preferred Provider Organizations (PPO), Private Fee-for-Service Plans (PFFS), Special Needs Plans (SNP), and Medicare Medical Savings Account Plans (MSA). If the consumer is enrolled in a Medicare Advantage plan, Medicare services are covered through the plan and are not paid for under Original Medicare. Most Medicare Advantage plans offer prescription drug coverage.
According to Medicare.gov, there are four basic characteristics of Medicare Advantage plans that the savvy consumer will want to understand. These include:
Annual enrollment and benefits
You can only join a plan at certain times during the year. In most cases, you are enrolled in a plan for a year. Plans can add benefits such as vision, dental and gym memberships, and can change these benefits from year to year.
Know your network
If you go to a doctor, other health care provider, facility, or supplier that does not belong to the plan’s network, your services may not be covered, or your costs could be higher. In most cases, this applies to Medicare Advantage HMOs and PPOs.
Understand that providers can change
Providers can join or leave a plan’s provider network anytime during the year. Your plan can also change the providers in the network anytime during the year. If this happens, you may need to choose a new provider.
Plans can stop participating in Medicare
If the plan decides to stop participating in Medicare, you will have to join another Medicare health plan or return to Original Medicare.
Once these basic characteristics of Medicare Advantage are understood, for the consumer the key factor is how to make a meaningful comparison between different plan options in terms of cost and services provided. Costs vary between different plans. For example, Medicare Advantage plans have a yearly limit on out-of-pocket costs for all medical services. Once the consumer reaches this limit, he or she will play nothing for covered services. This limit may be different between Medicare Advantage plans and can change each year. As Medicare.gov points out, the beneficiary should consider this when choosing a plan.
How can the beneficiary digest such a large amount of Medicare Advantage information that is part of the alphabet soup of Medicare? The promise of online healthcare exchanges is that they can provide tools for a meaningful comparison of Medicare Advantage plans. Further, they can help the consumer understand the costs and trade-offs between Medicare Advantage plans and choices along the other pathway, which includes Original Medicare and additional products such as Medicare Supplement and prescription drug coverage (Medicare Plan D).
Online tools have the capacity to take an enormous amount of complex information and make it available to the consumer in an easy language they can understand. Only then can the new Medicare beneficiary digest the alphabet soup that is Medicare and make a truly empowered decision about their insurance choices.
About the Author
Ellen Glassman, Ph.D. is a founder of Retiree Health Choices. She is a licensed life and health insurance broker with expertise in business development, design and marketing.
Retirees have an opportunity to consider Medicare plans and ensure they have selected the best plan for their needs.
An online consumer website is offering people a way to review and compare Medicare Supplement plans. Read the rest of this entry »
When you compare Medicare insurance with that of health insurance for the working population, it’s an alphabet soup.
Most in the workplace have the benefit of human resources assistance to decipher insurance plans, whereas retirees navigating Medicare often have to go it alone.
Some of the key decisions retirees need to consider when preparing to buy Medicare include:
• How much is it going to cost each month?
• What is my out-of-pocket exposure?
• What do I pay when seeing a doctor?
• Where do I have to go to get my care? Read the rest of this entry »