Seniors have choices

Wednesday, November 7, 2007

People on Medicare have a large variety of choices that can be made. Right now there is a great amount of advertisements for Medicare Advantage Plans and for Plan D Plans. The reason is that Open Enrollment Period is from Nov. 15 to Dec. 31. It is a time to review what you have and to evaluate other choices.

While it is an opportunity to make choices, it also adds to confusion. Seniors need to be cautious on what they do and fully understand the programs that they have selected. There are many rules that insurance governments and insurance agents must follow. The government is watching closely to make sure that the rules are followed for the protection of seniors. There are repercussions for those that are not following the guidelines that have been established.

To help those on Medicare to have helpful information the Centers for Medicare & Medicaid Services recently sent out a publication to each person on Medicare, "Medicare & You 2008." The information is also available at Even with all of this information many do not understand it and remain confused.

The cost for medical services is going up for senior citizens, but not as rapidly for those under 65. This adds to the cost for Medicare, Medicare Supplements and other programs. For most people on Plan B of Medicare the premium is being raised to $96.40 which is taken out of the Social Security check.

The cost for the Part A deductible will be $1,024 for each benefit period. When a person on Medicare goes to the hospital the deductible is paid before Medicare starts paying. Most people have a Medicare Supplement that will pay the deductible which is one of the factors that causes rate increases for the supplements.

The deductible for Part B services will be $135. There are other co-pays that are going up in 2008.

Most are enrolled in Part D (Medicare Prescription Drug Plan). It will be good to review your plan during the open enrollment period to determine if you have the best plans for your formularies. The deductible will be raised to $275. Some Plan D's pay this deductible, but that does not necessarily reduce the total cost for the year. The deductible period ends after a total of $2,510 has been paid and then the doughnut hole starts where basically there is a 100 percent out of pocket for the prescriptions. The doughnut hole will end after total out of pocket payment is $4,050.

Only less than 10 percent will reach the doughnut hole. Most of those enrolled in Part D may not want to take a plan that will make payments during the doughnut hole, because of a higher premium. Still, it is tough for those that reach the doughnut hole, less that 10 percent. However, they generally save 50 percent on their prescriptions compared to not having Plan D, which remains helpful to them.

With the Open Enrollment Program for Medicare Advantage products many will be approached about signing up for a Private Fee for Services or a Special Needs program. Those enrolled in Medicare Advantage must be enrolled in Part A and Part B of Medicare and after enrolling in the program will remain in Part A and Part B. Medicare Advantage products are not Medicare Supplements -- an important fact to know.

Medicare Advantage is administered by insurance government that has a contract with CMS. When a member goes to a provider they show their MA card and do not show their Medicare card as Medicare will not recognize it. If a person enrolls in MA they should be aware that they are not enrolling in Plan D. Still, there are MA plans that include Plan D.

There are advantages of Medicare Supplements over enrolling in Private Fee for Services. Still, there are advantages of Private Fee for Services over being enrolled in a Medicare Supplement. Again, they are not the same thing; we are talking about two entirely different products.

Companies have sent out letters to their Medicare Policy holders, providing information on why they should not enroll in Private Fee for Service. There is more freedom to select a provider, any which will accept Medicare. Not all doctors will accept MA plans. MA plans may pass higher cost to the members in higher premium or reduced benefits, even dis-enrollments. Medicare plans are standardized, MA plans are not. Medicare Supplements are time tested. Medicare often gives many more peace of mind. There is not the restriction with Medicare Supplements as MA plans where you are locked in for a period of time. Contracts of Medicare Advantage plans can be withdrawn from the market. Most Medicare Supplements are guaranteed renewal.

Some of the advantages of PFFS plans include low or no premiums (most will save $1,200 a year by enrolling in a PFFS plan. There generally is a limit on the out of pocket costs. Most do not have a requirement of being in a hospital three days before entering skilled nursing. There are no health questions for enrollment.

It is going to depend on each individual's situation and needs on what they should do. Study your situation, take a look at alternatives and then make the best decision for yourself.