Medicare Advantage and Medicare prescription drug coverage plan advertisements will soon be upon us. Below, I will explain briefly what these Medicare plans are and remind seniors of the 2012 open enrollment period.
Remember that Medicare is the major health insurance program for the elderly. Recipients of Medicare are typically one of the following: 1) people 65 years of age or older; 2) those who qualify for disability income; or 3) those who suffer from end-stage renal disorders. The Medicare program covers many expenses for hospital and institutional care, doctor payments, home health care and rehabilitative services, ambulance service, hospice for dying patients, equipment, limited medication, operations, some drug costs, etc.
Since Medicare doesn’t cover completely the costs listed above, private insurance carriers (e.g. AARP) offer supplemental policies for costs not covered by Medicare. These supplemental policies are often referred to as “Medigap” policies because they are designed to bridge the gap between the actual cost of care and the amount paid by Medicare.
Some seniors believe they receive better coverage by not using traditional Medicare and/or a supplemental policy. Instead, they elect a Medicare Advantage Plan (often referred to as a “Medicare Replacement Plan”) for their health care coverage. With these plans, Heath Maintenance Organizations (HMOs) offer health coverage options that are Medicare approved but administered by private companies.
The decision for our elderly to use traditional Medicare and a supplemental policy versus the Medicare Advantage Plan (HMO) services is a complex topic that I will address in a later article. For now, realize that there is a difference between the combination of traditional Medicare/supplemental insurance and the coverage typically provided by HMOs, and that the decision on which to use is unique for each individual. For example, sometimes HMOs are better at covering an individual’s prescriptions; however, traditional Medicare along with a supplemental policy may provide better nursing home rehabilitative coverage.
Each year, there is an open enrollment period during which Medicare recipients may choose a different Medicare option. For 2012 Medicare coverage, the open enrollment period runs from October 15 to December 7th, which differs from last year’s enrollment period. While exceptions exist, know that it may be impossible and/or come with a financial penalty to switch your Medicare if you do not do so during this period.
Choosing the right plan is not easy. One helpful resource is an organization called S.H.I.N.E. (Serving Health Insurance Needs of Elders). SHINE is a volunteer group that serves the Department of Elder Affairs for the state of Florida. SHINE volunteers are available to help seniors wade through the many Medicare options. SHINE’s website is: http://www.floridashine.org/ or you may call 1-800-96-ELDER (1-800-963-5337). Another great resource to explore is Medicare’s website: http://www.medicare.gov/. Other helpful resources available to assist the elderly sift through the Medicare options include elder law attorneys, geriatric care managers, and social workers.