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)
In the world of “entitlement” programs, the youngest Boomers just turning 50-years-old this year believe that social security will not be available for them nor will Medicare as we know it. While it would be nice to have research to support this, suffice it to say, survey 50-somethings and they’ll confirm this statement!
Many Boomers rarely have the opportunity to work for the same employer long enough to accrue some benefits into retirement. In addition, the current employee benefit model, highlighted by pensions and retiree health insurance, is in flux. Allen Steinberg, JD and chief legal officer of Retiree Health Choices, detailed the pension pendulum in this blog post recently.
The rocky rollout of the Affordable Healthcare Act under the banner of Healthcare.gov has influenced everyone in the country regardless of gender, political, religious, ethnic, or other persuasion. Right now it is a calamity for the country; yet, it is also an opportunity for organizations to recognize the need for clarity.
Many consumers, particularly boomers, are well informed and educated about an array of products and services, insurance plans and options. However, the transition to Medicare remains a gap – consumers are not aware of the complexity until they have to deal with it. Read the rest of this entry »
As the consumer healthcare market shifts, more scrutiny is being placed on cost of consumption of services. In a recent New York Times article Nov. 8, 2013, Good Deals on Pills? It’s Anyone’s Guess, Elisabeth Rosenthal reviews cost chaos with drugs.
For example, two popular medications for asthma and allergies, Advair and Rhinocort AQ, used by tens of thousands of Americans are no longer going to be covered by many benefit plans served by Medco/Express Scripts.
Shocked consumers will need to pay $300 and $150 respectively monthly for the brands they’re accustomed to, or find generics. In many cases, no approved generics are available.
Consumer Healthcare Cost Burden Shifting
In the past, consumers of healthcare have not been cognizant of the high cost of health care services or drugs. They presented an insurance card and rarely cared about the actual bill paid by the employer’s benefit plan.
This tradition is over, and the sticker shock over unsubsidized cost of medical and pharmaceutical prices is causing much anxiety.
A new burden is being placed on the consumer, and along with it, confusion. Read the rest of this entry »
Everyone eligible for Medicare (usually 65-years-old) automatically gets Part A and needs to sign up for Part B.
Because Parts A and B don’t cover everything, people can elect to buy supplemental coverage, often called Medicare Supplement insurance.
All of the Medicare Supplement plans, also called Medigap, are standardized in almost every state; yet, there are many options to consider when purchasing additional Medicare insurance from private insurers. Read the rest of this entry »
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 »
Retiree Health Choices is a Chicago technology company that helps retirees and Boomers navigate the often-complex Medicare sector. Recently, Retiree Health Choices launched EasyMedicareChoices.com to put retirees in the drivers’ seat with retirement insurance choices.
Before anyone enrolls in Medicare, however, they need to better understand the lexicon of the retirement insurance system.
More 65-year-old Americans are electing to stay in the workforce, and if they’re fortunate to have benefits that accompany full-time employment, then full dependence on Medicare can be postponed.
Most workers, however, are not so lucky when it comes to employer-provided health care. When an employee hits 65-years-old, the customary retirement age, then companies prefer health insurance benefits to be paid by Medicare.
Anyone still working through their ‘60s, needs to be fully aware of details about group health insurance coverage and Medicare plans. Often, it’s a gray area; there isn’t a benefits department in a workplace to assist 64-year-olds with insurance choices or which path to take and when.
There’s a new consumer website called EasyMedicareChoices.com, and it’s for:
- Seniors approaching 65-years-old
- Those beyond that age
- Caregivers of elderly who need help with their Medicare insurance
The site was designed and developed by Retiree Health Choices, a Chicago technology company interested in helping retirees make more informed decisions about their health care. Read the rest of this entry »
Every day, 10,000 people turn 60-years-old, and there are more enrolling in Medicare when reaching 65-years-old.
That magic age of 65, 67 or even 70-years-old has been burned into our heads since youth. It’s the age of retirement…the golden years when life is easy and time for relaxation is on our hands.
Because there are so many Boomers heading into “retirement,” there is also more research about what happens shortly thereafter.
One expert, Marc Freedman, CEO and founder of Encore.org, says, “retirement is a transition, not a destination.” His organization promotes encore careers – “second acts for the greater good.”
What Freedman suggests is that people entering retirement find themselves taking a sabbatical from work, a bit of time off but not long-term. For reasons that could be emotional or financial, retirees find themselves seeking a second act to fill the gaps from working 50-hours weekly to no work at all.
In many national magazines of late, there are special retirement features showcasing everything from places to live, the best this and the best that.
In Money magazine’s 2013 Retirement Guide, it details the top 20 places to live when retired.
The locations were selected via survey response from people 55+ interested in finding a great location to live it up after working for four decades. Imagine all the factors that contribute to making a choice of where to live when considering retirement! Read the rest of this entry »