Terms, def­i­ni­tions to help with un­der­stand­ing Medi­care

Record Observer - - Senior Satellite - By MIKE ZIM­MER

Ev­ery day in our prac­tice, we help folks who are el­i­gi­ble for Medi­care. Whether they are just turn­ing 65 or on Medi­care due to dis­abil­ity, un­der­stand­ing the dif­fer­ent terms that are associated with Medi­care can be a lit­tle con­fus­ing.

The fol­low­ing is a list of terms and def­i­ni­tions that we feel are im­por­tant in help­ing you to un­der­stand Medi­care:

• As­sign­ment – An agree­ment by your doc­tor, provider, or sup­plier to ac­cept the pay­ment amount Medi­care ap­proves for the ser­vice, and not to bill you for any more than the Medi­care de­ductible and coin­sur­ance.

• Ben­e­fit Pe­riod – The way Orig­i­nal Medi­care mea­sures your use of hos­pi­tal and skilled nurs­ing fa­cil­ity (SNF) ser­vices. A ben­e­fit pe­riod be­gins the day you’re ad­mit­ted as an in­pa­tient in a hos­pi­tal or SNF and ends when you haven’t re­ceived any in­pa­tient hos­pi­tal care or SNF care for 60 days in a row. You must pay the in­pa­tient hos­pi­tal de­ductible for each ben­e­fit pe­riod. There’s no limit to the num­ber of ben­e­fit pe­ri­ods.

• Coin­sur­ance – An amount you may be re­quired to pay as your share of the cost for ser­vices af­ter you pay any de­ductibles. Coin­sur­ance is usu­ally a per­cent­age (for ex­am­ple 20 per­cent).

• Co­pay­ment – An amount you may be re­quired to pay as your share of the cost for a med­i­cal ser­vice or sup­ply, like a doc­tor’s visit, hos­pi­tal out­pa­tient visit, or pre­scrip­tion drug. A co­pay­ment is usu­ally a set amount like $10 or $20.

• Cred­itable Pre­scrip­tion Drug Cov­er­age – Pre­scrip­tion drug cov­er­age (for ex­am­ple, from an em­ployer or union) that’s ex­pected to pay, on av­er­age, at least as much as Medi­care’s stan­dard pre­scrip­tion drug cov­er­age. Folks who have this kind of cov­er­age when they be­come el­i­gi­ble for Medi­care can gen­er­ally keep that cov­er­age with­out pay­ing a penalty, if they de­cide to en­roll in Medi­care pre­scrip­tion drug cov­er­age later.

• De­ductible – The amount you must pay for health care or pre­scrip­tions be­fore Orig­i­nal Medi­care, your pre­scrip­tion drug plan, or your other in­sur­ance be­gins to pay.

• Ex­tra Help – A Medi­care Pro­gram to help peo­ple with lim­ited in­come and re­sources pay Medi­care pre­scrip­tion drug pro­gram costs, like pre­mi­ums, de­ductibles and coin­sur­ance.

• For­mu­lary – A list of pre­scrip­tion drugs cov­ered by a pre­scrip­tion drug plan.

• Ini­tial En­roll­ment Pe­riod – When you’re first el­i­gi­ble for Medi­care, you have a seven-month Ini­tial En­roll­ment Pe­riod to sign up for Part A and/or Part B. It starts three months be­fore your 65th birth­day, the month of your birth­day and ends three months af­ter your birth­day. Some folks are el­i­gi­ble for Medi­care be­fore age 65 if they re­ceive dis­abil­ity ben­e­fits for more than two years or have amy­otrophic lat­eral scle­ro­sis or end-stage re­nal dis­ease.

• Late En­roll­ment Penalty – An amount added to your monthly pre­mium for Part B or a Medi­care drug plan (Part D) if you don’t join when you’re first el­i­gi­ble. You pay this higher amount as long as you have Medi­care. There are some ex­cep­tions.

• Life­time Re­serve Days – In Orig­i­nal Medi­care, these are ad­di­tional days that Medi­care will pay for when you’re in a hos­pi­tal for more than 90 days. You have a to­tal of 60 re­serve days that can be used dur­ing your life­time. For each life­time re­serve day, Medi­care pays all cov­ered costs ex­cept for a daily coin­sur­ance.

• Medi­care Ad­van­tage Plan – A type of Medi­care health plan of­fered by a pri­vate com­pany that con­tracts with Medi­care to pro­vide you with all your Part A and Part B ben­e­fits. Some Medi­care Ad­van­tage Plans in­clude pre­scrip­tion drug cov­er­age.

• Medi­care Ap­proved Amount – In Orig­i­nal Medi­care, this is the amount a doc­tor or sup­plier that ac­cepts as­sign­ment can be paid. It may be less than the ac­tual amount a doc­tor or sup­plier charges. Medi­care pays part of this amount and you’re re­spon­si­ble for the dif­fer­ence.

• Medi­care Part A (Hos­pi­tal In­sur­ance) – Part A cov­ers in­pa­tient hos­pi­tal stays, care in a skilled nurs­ing fa­cil­ity, hos­pice care, and some home health care.

• Medi­care Part B (Med­i­cal In­sur­ance) – Part B cov­ers cer­tain doctors’ ser­vices, out­pa­tient care, med­i­cal sup­plies, and pre­ven­tive ser­vices.

• Medi­care Sup­ple­ment Plan (Medi­gap) – Medi­care Sup­ple­ment In­sur­ance sold by pri­vate in­sur­ance com­pa­nies to fill “gaps” in Orig­i­nal Medi­care cov­er­age. There are 10 dif­fer­ent plans to choose from which help pay for de­ductibles, co­pays and coin­sur­ance.

• Open En­roll­ment for a Medi­care Sup­ple­ment Plan(Medi­gap) – A one-time-only, six-month pe­riod when fed­eral law al­lows you to buy any Medi­gap pol­icy you want that’s sold in your state. It starts in the first month that you’re cov­ered un­der Part B and you’re age 65 or older. This also ap­plies to folks un­der age 65 on dis­abil­ity and who are first el­i­gi­ble for Part B. Dur­ing this pe­riod, you can’t be de­nied a Medi­gap pol­icy or charged more due to past or present health prob­lems.

• Orig­i­nal Medi­care – Orig­i­nal Medi­care is a fee-for-ser­vice health plan that has two parts: Part A (Hos­pi­tal In­sur­ance) and Part B (Med­i­cal In­sur­ance). Af­ter you pay a de­ductible, Medi­care pays its share of the Medi­care-ap­proved amount, and you pay your share (coin­sur­ance and de­ductibles).

Although there are lots of other Medi­care terms, these are the ones that we are asked about most of­ten. We also have a lim­ited sup­ply of “2017 Medi­care & You” hand­books. If you would like to come by our of­fice and pick one up, give us a call, and we will save one for you.

Mike Zim­mer is Pres­i­dent of Bay State In­sur­ance Agency Ltd. in Cen­tre­ville. He is avail­able to an­swer your ques­tions or speak to your groups re­gard­ing Medi­care, Medi­care Ad­van­tage, Medi­care Sup­ple­ments and Medi­care Part D (Pre­scrip­tion Plans). He may be reached at 410-758-1680.

MIKE ZIM­MER

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