Medigap Medicare Supplement Insurance

1
Medigap (Medicare Supplement Insurance)
Module 3
2
Lesson 1 Medigap Basics
3
Session Topics

• Overview
• Medigap benefits
• Medigap plans
• Medigap costs
• More information

4
Session Topics

• Overview
• Medigap benefits
• Medigap plans
• Medigap costs
• More information

5
What Is Medigap?

• Health insurance policy
• Sold by private insurance companies
• Cover gaps in Original Medicare
• Follow Federal and state laws that protect you
• Must say Medicare Supplement Insurance

6
What Is Medigap? (continued)

• Health insurance policy
• 12 standardized policies in most states
• Plans A L
• Non-standardized policies
• Massachusetts
• Minnesota
• Wisconsin
• Costs may vary
• By plan
• By company
• Where you live

7
How Medigap Works

• Only works with Original Medicare
• Don't need Medigap policy in
• Medicare Advantage Plan
• Other Medicare plans
• Can go to any doctor, hospital, or provider that
  accepts Medicare
• Unless you have Medicare SELECT policy networks

8
Medigap Is Not

• Medicare Advantage Plans
• Medicare Part B
• Medicare Prescription Drug Plans
• Medicaid
• Employer or union plan
• TRICARE
• Veterans benefits

9
Who Can Buy Medigap?

• Must have Medicare Parts A and B
• May not be able to buy Medigap under 65
• People with a disability
• People with End-Stage Renal Disease
• Guaranteed right to buy a Medigap policy
• In your Medigap open enrollment period
• Covered under a Medigap protection (guaranteed
  issue)

10
Exercise
A. A Medigap policy works with

• A Medicare Advantage Plan
• Medicaid
• Original Medicare
• Medicare Prescription Drug Plan

11
Exercise
B. The front of a Medigap policy must
clearly identify it as

• Medicare Supplement Insurance
• Medicare Supplemental Insurance
• Medigap Supplement Insurance
• Medigap Supplemental Insurance

12
Exercise
C. Costs for a Medigap plan may vary by

• Plan
• Company
• Where you live
• All of the above

13
Session Topics

• Overview
• Medigap benefits
• Medigap plans
• Medigap costs
• More information

14
Why Buy Medigap?

• Original Medicare does not pay all costs
• Medigap policy may help you
• Lower your out-of-pocket costs
• Get more health insurance coverage

15
What to Consider

• Do you have other health insurance?
• How often do you need health care?
• What type of health care do you need?
• Does your doctor accept assignment?

16
Gaps in Original Medicare Coverage
What you pay in 2009Part A

• Hospital Stays
• Skilled Nursing
• Blood

• 1,068 deductible for days 1 60
• 267 per day for days 61 90
• 534 per day for days 91 150
• 0 for first 20 days
• Up to 133.50 per day for days 21 100
• 100 after day 100
• 100 for first 3 pints
• 20 for additional pints

17
Gaps in Original Medicare Coverage
What you pay in 2009Part A

• Home Health Care
• Hospice Care

• 0 for home health care services
• 20 for durable medical equipment
• Up to 5 copayment for outpatient prescription
  drugs
• 5 for inpatient respite care
• Room and board, in some cases

18
Gaps in Original Medicare Coverage
What you pay in 2009Part B

• Part B Deductible
• Part B Services

• 135 per year
• 20 coinsurance for most covered services
• 50 coinsurance for outpatient mental health
• Copayments for hospital outpatient services

19
Medigap Coverage
20
Medigap Coverage Plans A - J
21
Medigap Coverage Plans K L
22
Items Not Covered

• Long-term care
• Vision and dental care
• Including eyeglasses
• Hearing aids
• Private-duty nursing
• Outpatient prescription drugs

23
MIPPA Changes(Effective June 1, 2010)

• Adds hospice coverage
• Basic benefit to all plans
• Deletes preventive services at-home recovery
• Creates new Plans D G
• Eliminates E, H, I, and J Plans
• Creates a new Plans M N

24
2010 MIPPA Medigap Changes( denotes new plans
and benefits)
25
2010 Carryover Medigap Plans
26
Lets look at a case study

• Jonathan is 65 years old and is enrolled in
  Original Medicare, Parts A and B. He has a
  Medigap policy and thinks the first 3 pints of
  blood each year are covered by his Medigap
  policy.
• Is he correct?
• What are some basic Medigap benefits?

27
Exercise
A. All Plans A J cover

• Part A coinsurance for inpatient hospital care
• Dental care
• Prescription drugs
• All of the above

28
Exercise
B. Medigap Plans K and L

• Have different cost-sharing than Plans A - J
• Cover Hospice Care coinsurance or copayment
• Cover at different percentages
• All of the above

29
Exercise
C. Which statement is true about Plans K and L

• They pay only partial costs after Medicare pays
  its share
• They do not have an annual out-of-pocket maximum
• The out-of-pocket annual limits do not increase
  each year because of inflation
• These plans usually cost more

30
Session Topics

• Overview
• Medigap benefits
• Medigap plans
• Medigap costs
• More information

31
Special Types of Medigap Plans

• Medigap plans with drug coverage
• High-deductible plans
• Plans F, J
• Medigap plans with hospice care
• Plans K, L
• Massachusetts, Minnesota, and Wisconsin (waiver
  states)
• Medicare SELECT (network plans)

32
Drug Coverage and Medigap

• Medigap policies covering prescription drugs
• Only sold before January 1, 2006
• Same policies may be sold without drug coverage
• If your Medigap policy covers drugs
• Should have received information from company
• Explains how drug coverage affects your policy

33
Medigap Plans With Drug Coverage

• Standardized Plans H, I, J
• Sold before January 1, 2006
• Some policies in waiver states
• Massachusetts
• Minnesota
• Wisconsin
• Some pre-standardized plans
• Others

34
F and J High-Deductible Option

• 2,000 deductible for 2009
• Amount can go up each year
• Often have lower premium
• Out-of-pocket costs may be higher
• May not be able to change plans
• Additional deductibles
• Prescription drugs
• Foreign travel

35
Plans K and L

• Pay only partial costs after Medicare pays
• Have annual out-of-pocket maximum
• Plan K covers
• 50 for most services
• 4,620 out-of-pocket limit in 2009
• Plan L covers
• 75 for most services
• 2,310 out-of-pocket limit in 2009

36
Minnesota, Massachusetts, Wisconsin(waiver
states)

• A different kind of standardized plan
• NOT labeled Plans A L
• Offer comparable benefits to standardized plans
• Basic benefits
• Optional benefits
• For information
• Call State Insurance Department

37
Medicare SELECT

• A type of Medigap policy (Plans A L) with
  networks
• To get full benefits (except in emergency)
• Must use specific hospitals
• In some cases must see specific doctors
• Generally cost less than non-network plans
• Can switch to another Medigap plan
• Same or lower value
• May not be offered in your state

38
Session Topics

• Overview
• Medigap benefits
• Medigap plans
• Medigap costs
• More information

39
How Much Does Medigap Cost?

• Depends on
• Your age (in some states)
• Where you live
• Company selling the policy
• Can be big differences in premiums
• For exactly the same coverage
• Compare the same Medigap policies

40
Pricing Based on Age
41
What is Underwriting?

• Review
• Health status
• Medical history
• Insurance company determines
• Whether to accept your application
• How much to charge you
• Whether to make you wait for some benefits
• Application
• Usually includes medical questions
• Fill out carefully

42
Buying a Medigap Policy

• May be able to buy a policy any time
• Best time is during open enrollment period
• Lasts for 6 months
• Starts on first day of the month you are
• Age 65 or older AND
• Enrolled in Medicare Part B
• Once 6-month Medigap open enrollment period
  starts, it can't be changed

43
Open Enrollment Period

• Insurance company cant
• Deny you coverage
• Make you wait for coverage to start
• But may make you wait for coverage of
  pre-existing conditions
• Unless you have creditable coverage
• Charge you more for a policy
• Because of your health problems

44
Waiting to Enroll in Part B

• Medigap open enrollment period starts
• Age 65 and enrolled in Part B
• Consider waiting to enroll in Part B
• If you or your spouse still working and
• You have group health coverage

45
Buying a Medigap Policy

• Important decisionshop carefully
• Four steps
• Decide which plans meet your needs
• Learn which companies sell Medigap in your state
• Call the companies and compare costs
• Buy the Medigap policy

46
Lets look at a case study

• It is October 1, 2008, and Sam (who is 65) wants
  to buy a Medigap policy. He needs to know if he
  is in his Medigap open enrollment period. He
  looks at his Medicare card. His Medicare Part B
  coverage started August 1, 2008.
• Is Sam in his Medigap open enrollment period?
• Can the company deny him coverage?

47
Exercise
A. Companies may not sell new Medigap policies
covering prescription drugs after January 1, 2006?

• True
• False

48
Exercise
B. Your Medigap Open Enrollment Period

• Is an opportunity for the company to charge you
  more for past health problems
• Can begin even if you dont have Part B
• Lasts for six months, begins when you are at
  least 65 and enrolled in Part B
• None of the above

49
Exercise
C. Once the 6-month Medigap open enrollment
period starts, it can't be changed

• True
• False

50
Session Topics

• Overview
• Medigap benefits
• Medigap plans
• Medigap costs
• More information

51
Getting Information

• State Health Insurance Assistance Program
• (SHIP)
• Ask for a rate guide or shoppers guide
• Your State Insurance Department
• www.medicare.gov
• 1-800-MEDICARE (1-800-633-4227)

52
Lesson 2 Medigap in Detail
53
Session Topics

• Prior creditable coverage
• Under age 65
• Medigap and Medicaid
• Guaranteed issue
• Other supplemental insurance
• More information

54
Session Topics

• Prior creditable coverage
• Under age 65
• Medigap and Medicaid
• Guaranteed issue
• Other supplemental insurance
• More information

55
Pre-Existing Condition

• Health problem before new policy starts
• Medigap issuer can refuse to cover that condition
• If diagnosed or treated during the 6 months
  before the policy starts
• For up to 6 months in some cases
• Called pre-existing condition waiting period

56
Creditable Coverage

• Coverage you had before applying for Medigap
• Can avoid or shorten waiting period for
  apre-existing condition
• Medigap issuer cannot refuse to cover
  pre-existing conditions
• If at least 6 months creditable coverage
• With no break in coverage of morethan 63 days

57
Examples of Creditable Coverage

• Union/employer group health plan
• Some health insurance policies
• Medicare Part A or B
• Medicaid
• IHS or tribal organization
• A state health benefits risk pool

• TRICARE
• FEHBP
• Public health plan
• Health plan under the Peace Corps Act
• COBRA
• CHIP

58
Not Creditable Coverage

• Hospital indemnity insurance
• Specified disease insurance
• For example, cancer insurance
• Vision or dental policies
• Long-term care policies

58
59
Lets look at a case study

• Harry is 65. He was diagnosed with heart disease
  early in 2008. He had no health insurance
  coverage until his Medicare Part A and Part B
  started November 1, 2008. Harry buys a Medigap
  policy with coverage starting March 1, 2009.
• Can the Medigap insurance company refuse to cover
  Harrys heart condition for 6 months?
• Does Harry have prior creditable coverage?
• What if Harrys heart condition hadnt been
  diagnosed?

59
60
Session Topics

• Prior creditable coverage
• Under age 65
• Medigap and Medicaid
• Guaranteed issue
• Other supplemental insurance
• More information

61
Medigap for People Under 65

• Federal law does not require coverage
• May not be able to buy a Medigap policy
• Some state laws give Medigap rights to people
  under 65
• At age 65
• Can choose and buy any Medigap policy
• Companies cannot refuse to sell Medigap
• 6-month open enrollment period
• Already have Medigap
• May reapply to get a better rate

62
Medigap for People Under 65

• Some companies sell to people under 65
• Policies may cost more
• Some states require Medigap be offered
• See Choosing a Medigap Policy Guide to Health
  Insurance for People with Medicare
• Another open enrollment period at 65

63
Right to Suspend Medigap

• Under 65 and entitled due to a disability
• Right to suspend your Medigap policy
• While enrolled in employer group health plan
• Without penalty
• Get your Medigap policy back at any time
• Must notify Medigap insurer within 90 days of
  losing employer group coverage

64
Lets look at a case study

• Martin just enrolled in Original Medicare. He is
  concerned about his ability to pay the
  coinsurance and deductible if he is ever admitted
  to the hospital for a lengthy stay.
• Would a Medigap policy cover Martins coinsurance
  for an inpatient hospital stay?

65
Session Topics

• Prior creditable coverage
• Under age 65
• Medigap and Medicaid
• Guaranteed issue
• Other supplemental insurance
• More information

66
Medigap and Medicaid

• If you have both Medicare and Medicaid
• Most health care costs are covered
• Can suspend Medigap policy for up to 2 years
• An insurance company can sell you a Medigap
  policy only in certain situations
• For information, call state Medicaid office

67
Suspending Medigap

• Right to suspend Medigap
• Within 90 days of getting Medicaid
• Do not pay premiums
• Policy will not pay benefits
• Can suspend policy for up to 2 years
• Can start it up again
• No new medical underwriting
• No pre-existing condition waiting periods
• Call state Medicaid office

68
Session Topics

• Prior creditable coverage
• Under age 65
• Medigap and Medicaid
• Guaranteed issue rights
• Other supplemental insurance
• More information

69
Medigap Rights and Protections

• Also called guaranteed issue rights
• Special rights to buy Medigap based on occurrence
  of certain events
• Keep
• Letters
• Claim denials
• Postmarked envelopes
• Protections are in Federal law
• Many states provide more Medigap protections
• Call your SHIP or State Insurance Department

70
Summary of Medigap Protections

• Guaranteed issue rights in some situations
• Right to buy a Medigap policy
• Apply within 63 days from other coverage ending
• In these situations, an insurance company
• Must sell you a Medigap policy
• Must cover all pre-existing conditions
• Cant charge more because of past or present
  health problems

71
Guaranteed Issue Rights

• Rights to purchase in most cases Plans A, B, C,
  F, K, or L, if
• Medicare Advantage or PACE coverage ends
• Employer group health plan coverage that pays
  secondary to Medicare ends
• Health coverage ends because you move out of the
  plan's service area
• You joined a Medicare Advantage or PACE Plan
• First eligible for Medicare at age 65 and leave
  within 12 months

72
Guaranteed Issue Rights (continued)

• You dropped a Medigap policy and enrolled in
  Medicare Advantage Plan for first time
• Stayed in the plan less than a year and
• Want to switch back
• Medigap coverage ends through no fault of your
  own
• Plan or insurance company committed fraud

73
Lets look at a case study

• Jennie is 69 and joined a Medicare Advantage Plan
  when she first was eligible for Medicare at age
  65. She decides she would like to drop her
  Medicare Advantage Plan and go to Original
  Medicare.
• Does Jennie have a guaranteed issue right to a
  Medigap policy?

74
Session Topics

• Prior creditable coverage
• Under age 65
• Medigap and Medicaid
• Guaranteed issue
• Other supplemental insurance
• More information

75
Other Supplemental Insurance(non-Medigap)

• Group health coverage
• Employer
• Union
• Organization or association
• TRICARE for Life
• COBRA
• Understand your benefits and costs

76
Session Topics

• Prior creditable coverage
• Under age 65
• Medigap and Medicaid
• Guaranteed issue
• Other supplemental insurance
• More information

77
Local Information
78
Information Sources for Medigap

• 2009 Choosing a Medigap Policy A Guide to Health
  Insurance for People With Medicare
• Available on www.medicare.gov
• SHIP
• State Insurance Department
• 1-800-MEDICARE
• 1-800-633-4227
• 1-877-486-2048 for TTY users

78
79
Medigap Benefits Comparison
80
This training module provided by the For
questions about training products, e-mail
NMTP_at_cms.hhs.gov To view all available NMTP
materials or to subscribe to our listserv, visit
www.cms.hhs.gov/NationalMedicareTrainingProgram
80