Medicare

Anybody out there of Medicare age? I'm approaching, and am trying to decide which way to go.

There's lots of material out there about the plans, and I've been reading up. What I'm looking for now is what isn't in the literature; basically, the gotchas of the different approaches: bureaucracy, pre-approval requirements, hidden limitations, customer-unfriendly policies or service, stuff like that.

For starters, there's a choice between Medicare Advantage (HMO, PPO, or PFFS) and Original Medicare.

I wouldn't choose an HMO (just not a fan of HMOs).

Currently, I have an individual PPO plan. I like that the preferred providers are documented in advance and there's lots of choice. The company I'm using now doesn't offer a Medicare Advantage PPO; the alternative PPOs here are a possibility but the choices don't look all that appealing.

Medicare Advantage PFFS plans are puzzling. There seems to be no way to know in advance what providers participate. A PFFS plan would be interesting if it extended the number of hospital days and nursing-facility days beyond the limits of Original Medicare, but none I've seen do this.

For Original Medicare, I'm curious about pre-approval. Is there any, and who makes the decision? Likewise, are claims denied after the service is done, and who makes the decision? Any examples of unreasonable decisions?

Advice based on personal experience would be helpful.

Reply to
pomegranate-man
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I am 73, on Medicare, and have a supplemental PPO that I am most happy with. All the medical people and hospitals know what Medicare will cover and what they will not. Do a Google Search on Medicare and you can read for yourself what Part A, B etc. is all about. Between Medicare and my PPO, about 95% of all my medical costs have been covered. I have a few co-pays that make that 5% personal costs.

Reply to
Lon

Moderator: Hopefully this is short enough

This is a note I prepared for someone else in another newsgroup but it might help.

As a trained SHIP (or HICAP as we call it in California) counselor I have to correct errors in your post about the risks of using MediCare Advantage (MA).

(SHIP does objective free counseling on MediCare - see

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also AARP has a number of understandable pamphlets on the subject. Medicare's booklet "Medicare and You 2007" is also relatively readable but do it one page at a time)

First a disclaimer - I have chosen to buy a MediGap policy rather than enroll in an MA plan. See the last paragraph as to why.

Simplifying for brevity

Basic MediCare Part A covers admissions to hospitals. You will owe $1024 (in 2008) per admission as long as there are at least 60 days between admissions. After 3 days in a hospital you get 20 days in a skilled nursing home. Note that the Ambulance, the ER and day surgery are not covered in Part A., Part A is free

Basic MediCare Part B covers doctors, the ambulance, the ER, day surgery, labs and things like wheel chairs. You will pay 20% of doctors, the ambulance, the ER, day surgery, and things like wheel chairs. Lab work and diagnostic X-rays are free. There is a $992 cap on the cost of the ER and day surgery (but not including the doctors therein). Part B costs $96.40/month in 2008, withheld from your Social Security

MediCare Part D covers prescription meds.

While 20% of an office visit (about $12 in my area) is reasonable, the $1024 or 20% of a heart bypass surgeon may be hard to deal with.

If you are poor there is MedicAid, if you are rich you whip out your check book. For the rest us it is either Medigap (also called MediCare Supplement) or MA

In this area a decent MediGap (Plan C through Plan J) will cost you about $150/month provided you enrolled within 6 months of age 65. You also need Part D which will cost about $25/month. Medigap will essentially cover all of your share of costs for services covered under MediCare.

In this area MA comes in 3 flavors - HMO, PPO and PFFS. Since most of my clients opt for HMOs I'll cover these first. In my area we have 12 HMOs to choose from. 11 of the 12 HMOs have no monthly premiums. Office visits typically run $10 (although they are free in one plan). Typically a stay in the hospital is $250. An ambulance is $75. The ER is $50, but Day Surgery, labs and X rays are free. All have the 20 days in the nursing home but waive the 3 days in the hospital. All of the 12 plans include a Part D equivalent. Most offer some Podiatry and vision care. What's the catch - you must select an primary care doctor and use the specialists, and hospitals that he sends you too.

If you consider two people who have been told that they have lung cancer and the recommended treatment plan is surgery followed by radiation and then chemotherapy on an outpatient basis.

Mr MG has a Medigap policy and Part D. He has been paying $175 a month since he was 65. He can choose any surgeon, hospital, radiation center and chemo doctor that he wants as long as the provider accepts MediCare. He will receive no bills except for the Chemo and any Rx. The chemo stuff (but not the doctor) is covered under Part D. He will probably pay

1/3 of the cost of the chemo and soon arrive at the gap.

Mr MA has been paying nothing each month. He will use the surgeon (no cost except $10 for office visits) chosen by his primary care doctor's medical group. He will pay his $250 at the hospital selected by the medical group . Later he will go to the selected radiation center (paying $10 per visit) and the approved chemo place where he will pay $10 a visit and the same amounts for the chemo as Mr MG. There are no hidden costs, just the restrictions on who treats you and where. I suspect that if there are multiple treatments available you will be quietly steered to the least expensive.

It is obvious why a person living solely on social security (and there are lots of them) would choose an MA plan. If being able to see whom ever you want, where ever you want, and having some say in choice of treatment is important to you and you can afford the $175/month then MediGap is your choice. People who have multiple illnesses when they start MediCare and are seeing various specialists find MA very difficult to deal with.

In my area there are two PPOs - a free one with $1000 deductible and a $50/mo one with a $500 deductible. Both come with an inclusive Part D and have an out of packet annual cap of $3000 per year

The PFFS's run between $50 and $100 a month and an inclusive Part D. PFFS are relatively new this year and there is still a lot of uncertainty about which providers will take which PFFS. Typically PFFSs pay providers about 1% more that PPOs pay in network providers.

Note that not all doctors take MediCare especially in affluent and rural areas. MediCare does pay providers more than MediCal (Medicaid in CA)

Reply to
Avrum Lapin

Thank you for the thorough and thoughtful response.

Unfortunately, I'm still puzzled over some details.

I'm in California too. My knowledge of Medicare details is probably faulty, so please correct any errors below.

MediGap is one of the plans I'm trying to get my head around.

Surely you aren't suggesting it's sensible to pay $1,800/yr ($150/mo) to protect against a possible loss of $1024. I'm in good health, but even sickly people don't typically have major surgery every year. (My guess is there's a typo in your surgeon dollar amount; plus, there are other costly specialized services are involved in major surgery; plus, ...)

So typically, if somebody had severe episode like a heart bypass, how much would MediGap pay in total dollars? And how much would the patient pay after Parts A, B, D, and MediGap? Maybe there are a few examples from experience. Is there a maximum dollar figure MediGap would pay?

It also seems that MediGap shields us from the first dollars of expense, but (like Parts A and B) cuts off when the expenses pile up. I'm referring to the limits of 150 hospital days and 100 skilled-nursing- facility days per benefit period. As far as I can tell, nothing in the Medicare menagerie extends these limits. Even Medicare Advantage plans that tout "unlimited days" qualify it by saying "Medicare-covered" charges -- I've asked, and this qualifier means that the "day" limits still apply. Am I wrong to be concerned about these limits? There's got to be some kind of really low-cost supplemental medical coverage outside the Medicare system that kicks in when the limits are reached, but I haven't found any. Nothing from my employment history applies. (I'm aware that long-term-care insurance for custodial nursing-home or assisted- living stays is a separate topic outside the scope of a Medicare discussion.)

Parts of Medicare (including Parts B and D, if I'm not mistaken) are subsidized from the taxes we've paid. So an individual can expect to receive more in benefits than he pays in premiums, on average over time. Is this true of MediGap?

Thanks again!

Reply to
pomegranate-man

I have no idea of what a bypass surgeon charges but I expect that 20% of that charge is in excess of $1024.

Providers who agree to accept MediCare agree to accept the MediCare approved amount for the procedure as payment in full (there is a provision for a provider to charge and receive 15% above the MediCare approved amount but in this area none of the providers do this). MediCare then pays 80% of the approved amount and MediGap will pay the rest. In larger MediGap plans the payment occurs seamlessly.

If MediCare does not cover something (say you exceed the 100 days in the nursing home or have a tummy tuck) there is no product that I am aware of that will cover you other than long term care insurance. MediCare does not cover work done by a provider who does not accept MediCare.

So if you have a "vegetative" coma in your future you will be expected to spend down your income and assets (less an amount for your spouse and dependents still at home) and go on MedicAid (welfare)

For what it is worth the MediCare pends an average of $1000 per month per person on the over 65 crowd. Memory suggests that MediCare still takes in more than it spends but that trend is due to reverse in the near future.

Reply to
Avrum Lapin

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"Per capita expenditures increased by about $2,000 for each age group over 65: Per capita expenditures were $5,042 for those ages 65 to 74, $7,789 for those 75 to 84, and $9,243 for those 85 and older. Per capita expenditures for Medicare beneficiaries under age 65, enrolled due to disability (both end-stage renal disease and non- ESRD), were $6,513. On average, Medicare spending per beneficiary was $6,602."

-- Ron

Reply to
Ron Peterson

Thanks for the reference.

Those numbers are for 2003. For CY 2008 Medicare will pay $885.55/mo/enrollee ($10626) to MediCare Advantage plans ($54 less/mo for the under 65 disabled) for San Bernardino County (60 miles east of LA). They pay more in LA county and slightly less in Riverside County. This excludes ESRD.

Reply to
Avrum Lapin

There are large differences in Medicare costs per state. See

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Part of the cost differences are due to the general health of the population (LA, MS, OK, TX, etc.), and part due to the cost of the services (NY, CA).

-- Ron

Reply to
Ron Peterson

Is a "supplemental PPO" the same as what I've seen called "Medicare SELECT?" From the literature, this choice seems puzzling when it comes to choosing a provider. Is it the case that the provider has to be both: - one that accepts Medicare (for the Medicare A&B part) and also - be in the carrier's preferred list (for the PPO part)?

Reply to
pomegranate-man

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