Out-of-Pocket Expenses in a Medicare Advantage Plan

A Medicare Advantage Plan is a privately run health plan, owned by private insurance companies, approved by (and working with) Medicare.  Medicare advantage plans, called MAs, or Part C, are required to follow rules set by Medicare and, in addition to your payments and fees, receive funding from Medicare.  

MA plans will provide beneficiaries with their Hospital Insurance (Part A) and Medical Insurance (Part B), all medically-necessary services covered by Original Medicare, and, in many cases, optional extra benefits such as vision, dental, hearing, and prescription drug coverage – for additional cost, of course.

In fact, many of your out-of-pocket costs in a Medicare Advantage Plan will vary significantly.  For instance, many MA plans will charge, on top of your Part B premium, another monthly premium.  Your costs will also vary depending on whether or not your MA plan has a yearly deductible or any other deductibles for certain health care services.  Costs can increase if your plan requires you to pay more for each doctor’s visit or health care service.  If you frequently require health care or if you need more costly services, this can also increase your out-of-pocket costs.  If you decide you want extra benefits, you can expect to pay more for these as well.   

There are, of course, some ways to reduce costs.  First – and perhaps most importantly – research available plans carefully.  Contact Medicare, at www.medicare.gov or at 1-800-MEDICARE – or call your local SHIP to find out more. Once you’ve selected a plan, be sure to familiarize yourself with your MA plan’s rules, and to follow them vigilantly. 

The right MA plan can allow you to receive the medical coverage you need.  However, unexpected costs can put a strain on your budget and, in some cases, even make receiving the care you need a significant hardship.  An awareness of the out-of-pocket costs involved in your Medicare Advantage plan can help you prepare for those expenses, and allow you to financially arrange for your future.

Understanding Assignment in the Original Medicare Plan

In the Original Medicare Plan, “assignment” is when you make an agreement between yourself, your healthcare providers, and Medicare.  It can be used to limit the amount of out-of-pocket costs you will be responsible for in your health care.  

How assignment in Medicare works is when you choose health care providers already enrolled in Medicare – and who will accept assignment – you then assign Medicare to pay those health care providers. 

A health care provider who accepts assignment will agree to be paid by Medicare and to accept the Medicare-approved amount for services.  They will also agree to charge you (or your other insurance providers) only the Medicare deductible or coinsurance.   

When a health care provider accepts assignment (and in certain situations, they are required to do so), they need to submit your claim directly to Medicare, and should not charge you for submitting the claim. 

If your health care providers do not agree to accept assignment, they must submit a claim to Medicare but can charge you more than the Medicare-approved amount.  Even if they don’t accept assignment, though, they are usually limited in what they can charge (referred to as a “limiting charge”).  This charge can be up to 15% more than the Medicare-approved amount.  Not all services and supplies have a limiting charge, and sometimes you’ll need to pay for supplies or services before being reimbursed later.  

If you need to find health care providers who accept assignment, an excellent resource is www.medicare.gov.

Medicare Costs in 2008

In the Original Medicare Plan, your specific costs will include premiums, deductibles, and coinsurance amounts.  Part A and Part B differ in cost requirements, and your amounts will vary from year to year. 

Usually, Part A doesn’t call for a monthly premium if you or your spouse paid enough Medicare taxes while you were working.  In this case, you will most likely be automatically enrolled when you turn 65.  However, if you don’t qualify for premium-free Part A, your monthly premium for this component of your Medicare coverage can be up to $423.00.  If you have 30 – 39 quarters of Medicare-covered employment, your Part A monthly premium will be $233.00

Your Part A deductible, per benefit period, will most likely be $1,024.00, and your coinsurance amount will be $256.00 a day for the 61^st – 90^th day each benefit period.  For each lifetime reserve day, coinsurance will be $512.00 for the 91^st – 150^th day. 

For your Part B, your monthly premium will likely be $96.40.  However, some people will pay more, depending on their modified adjusted gross income.  For your Part B deductible, you will need to pay $135.00 for the year, and then 20% of the Medicare approved amount for services after this deductible. 

To find out more, visit www.medicare.gov. 

Medicare Fraud

Medicare fraud is an unnecessary drain on the Medicare system, and can be costing you money.  Instigated by an individual or company, it can be detrimental to both Medicare and the beneficiaries. 

When Medicare is deliberately billed for false services or supplies, which the beneficiary never received, it is called fraud.  This type of fraud can sometimes be the work of a doctor, a pharmacist, another health care provider, or a group of these professionals.  Although most people who work within the system are generally trustworthy, the fact remains that some are simply not.  These few dishonest people are indeed having a negative impact, and, because Medicare fraud can be so costly, beneficiaries may consequently see an increase in their premiums.    

In addition to protecting lower premiums, preventing or catching Medicare fraud can result in a financial reward.  If you report suspected Medicare fraud and your suspicion is reviewed by the Inspector General’s office, if your suspected fraud isn’t already being investigated, and if your report leads to the recovery of a minimum of $100.00, you may be eligible for a reward of up to $1000.00. 

If you suspect Medicare fraud, call your health provider to ensure your bill is correct.  You can also call Medicare to voice your concern or the Inspector General’s hotline (1-800-HHS-TIPS).

Protecting Yourself from Identity Theft

When you sign up for Medicare, you are taking steps to ensure your health needs can be met.  However, at the same time, you should make sure you are taking the necessary steps to protect yourself from those who would take advantage of you and your enrollment. 

For instance, a real risk to those unaware can be identity theft.  Identity theft occurs when your personal information is used by someone else to commit crimes, including fraud.  To protect yourself from identity theft, keep your personal information safe.  Don’t give out things like your social security, Medicare, or credit card numbers to anyone who is not your doctor, a verified health care provider, someone who you know to work with Medicare (like your SHIP), social security, or a plan approved by Medicare.

Make sure, also, that the person you are giving the information to really is the person they claim to be.  For instance, if someone calls or visits you, selling Medicare-covered products, don’t give them your personal information.  Also, if someone calls you, asking for personal information (like credit card number or Medicare number) and claims to be from a Medicare plan, be wary.  Unless you are a member of a specific plan, a plan can’t ask you for any personal information. 

If you suspect you may be a victim of identity theft, call the Fraud Hotline at 1-800-447-8477, or the Federal Trade Commission’s ID Theft Hotline at 1-877-438-4338.

Filing a Complaint about Your Medicare Drug Plan

A Medicare Prescription Drug Plan can be an excellent component in ensuring you have the health coverage you need.  However, even with a carefully chosen drug plan, you may run into issues.  Fortunately, if you are having problems, you can choose to file a complaint with your plan.

A complaint, termed a grievance, can be filed for a number of valid reasons.  For instance, if you have made a first-level appeal, or asked for a coverage determination, and you haven’t received a response in the required timeframe, you may want to file a grievance.  You may also want to file a complaint if your plan has decided not to approve your request for expedited coverage determination or first level appeal.  You may choose to file a complaint if your plan failed to supply you with necessary notices, or if the notices don’t follow standard Medicare regulations.  Another reason you may file a complaint is if feel your pharmacy has charged you more than you think you should have been charged or if you have had to wait an exorbitant time for a prescription.  Finally, think about filing a complaint if you don’t think your plan’s customer service hours of operation are fair or if your plan’s company is sending you materials not related to the drug plan (which you didn’t request).

As an individual with a Medicare Prescription Drug Plan, you have the right to file a grievance with your plan.  You have 60 calendar days from the event leading to your complaint to file.  If you feel you have been treated unjustly, file your complaint as soon as possible.

Policy Change Provides Coverage, in Clinical Studies, of Artificial Hearts

On May 1^st, the Centers for Medicare & Medicaid Services announced a change in policy which will benefit patients with severe heart failure.  The new policy allows Medicare to cover artificial heart devices when used as part of a FDA-approved study, as long as the study meets CMS’ clinical research criteria. 

Artificial heart devices are intended to help patients with critical heart failure.  In many cases, the device will help someone survive until a transplant heart becomes available.  They can also be used to prolong the lives of patients unable to receive a transplant. 

Although Medicare has not previously covered the use of this technology, research on the safety and success of artificial hearts has resulted in an important change of policy.  While CMS still does not believe evidence is conclusive on the necessity of the device, they have determined that it can potentially improve health outcomes and should be further researched. Therefore, under certain circumstances, people requiring the life-saving measures offered by artificial heart devices can receive the needed coverage. 

In order to receive coverage, the artificial heart must be implanted as part of a clinical study, approved by the FDA.  The study must be designed to answer one of three specific research questions and meet a number of criteria (available in detail at http://www.cms.hhs.gov/mcd/viewdecisionmemo.asp?id=211)

The new policy guidelines are intended to protect beneficiaries, since a clinical study will include safety, patient protection, monitoring, and expertise.   The guidelines are also, of course, designed to aid the continuing research on the outcomes of artificial heart technology.  Whatever the reasons or requirements involved in the policy change, it can only mean good news for those requiring an artificial heart. 

Levels of Appeal in a Drug Plan

If your Medicare prescription drug plan won’t provide you with necessary drug coverage or if you feel you were overcharged, you do have the right to appeal. 

Before appealing, the first step in the process is to request a coverage determination, which is a written explanation about your coverage, from your drug plan. In most cases, you must make this request in writing (although some plans do accept phone requests).  Typically, you will find out the decision of the determination within 72 hours of making the request.

If you disagree with the coverage determination, you have the option of appealing the decision.  This “redetermination” is the first level of appeal and must be filed within 60 days from the date of your coverage determination.  (Your plan will give you information on how to appeal).  If your health is in imminent danger, you can file an expedited request; otherwise, you will file a standard request. Standard requests will receive a reply within 7 calendar days while requests that are expedited will receive a reply within 72 hours. 

If you disagree with the redetermination, you can request a review by an Independent Review Entity within 60 calendar days.  This review is called  a “reconsideration,” and must be requested in writing. The IRE should come to a decision within 7 days for a standard review request.  If your request has been expedited, which happens when the IRE or your doctor concludes your life or health is placed in danger by waiting, you will receive a decision within 72 hours.

If the decision of the IRE is not in your favor, you may request a hearing with an Administrative Law Judge.  This written request must be sent, within 60 calender days from when you receive the reconsideration decision, to the location identified in the notice.  In order to receive a hearing with an Administrative Law Judge, the total value of your denied coverage claim(s) must meet a minimum amount. 

If you object to the decision by the ALJ, your next step is requesting a review by the Medicare Appeals Council.  This request must be made in writing 60 days from the date of the ALJ’s notice, to the location specified therein.

If you object to the decision of the Medicare Appeals council, you can request a review by a Federal court.  Again, this review must be made in writing, 60 calendar days or less from the date of the Medicare Appeals council’s decision notice.  As before, the total value of your claim(s) must meet a minimum dollar requirement. 

The levels of appeal are provided to ensure you have a fair chance to have your case heard.  If you disagree with a decision made by your drug plan, you do, consequently, have options.

Requesting a Review from the Quality Improvement Organization

If you feel you are being discharged from a hospital stay before you are ready, you, as a Medicare beneficiary, have the right to ask for a review by the Quality Improvement Organization (QIO). 

To receive a review, you need to contact the Quality Improvement Organization as soon as possible, before you are discharged, and ask them for a fast review.  If you do, you will be able to stay past your discharge date without paying more than applicable coinsurance or deductibles until the QIO is able to make a decision.

Soon after you request the fast review from the QIO, they will notify the hospital.  The hospital will then give you a “Detailed Notice of Discharge”.  This notice explains why your stay is no longer necessary, the connected Medicare coverage rule, and how this rule applies to your situation.  The notice will be delivered to you no later than noon following the day of the QIO’s notification to your hospital.  The QIO will consider your medical information as well as your opinion (or that of your appointed representative), and decide if you are ready to be discharged on the date the hospital set for you.  They should reach their decision within one day after getting the necessary information.  

If the QIO rules in your favor, Medicare coverage will continue for your care services as long as necessary.  If the QIO rules against you, however, you will need to leave the hospital by noon the day after the QIO gives its decisions.  You will not be required to pay any hospital charges occurring before the new mandatory discharge time (outside of applicable coinsurance or deductibles).

The hospital will provide you with the QIO phone number.  You can contact them for more information, or call Medicare at 1-800-633-4227.

Medicare Advantage Plans: Rights and Protections

All Medicare recipients, regardless of plan, are entitled to certain specific rights. However, Medicare Advantage Plans also have additional rights and protections. 

For instance, you will usually have the right to your choice of, and access to, health care providers.  This means that, in many Medicare Advantage Plans, you are able to choose health care providers within your plan in order to get necessary care.  In situations where you have a serious medical condition, you have the right to get a treatment plan from your doctor, which will allow you to see a specialist (within your plan) as many times as needed.  You also have the right to know how your plan pays your doctors. The method of payment should allow you to get the required medical care. 

Like in your basic Medicare rights, Medicare Advantage plans give you the right to a fair appeal process if you disagree with a coverage policy or decision.  You have the right, as well, to a fast appeal in-hospital, and if you believe you are being discharged too soon, you do have that appeal option.  You also have the right to file a grievance over any concerns you are having with your Plan.  Along with these appeal rights, you have the right to have the privacy of your health information protected. 

 If you have questions for your Medicare Advantage Plan, you have the right to call them.  They should be willing to answer any coverage questions you have and give you additional information.

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