Medicare Supplement plans, for the most part, pay for the Medicare deductibles and 20 percent coinsurance (depending on your plan) which you are responsible for when you see a doctor or hospital.  So let’s talk about some of the common terms you need to be aware of with Medicare and a Medicare Supplement (Medigap) plan:

Common Terms:

• Birthday Rule – (Unique in only a few States) allows a current Medicare Supplement insured to switch to another company each year on the month of their birthday to a plan will equal or less benefits.  This switch is guaranteed regardless of the current or past health issues.  In other word you cannot be denied because of your health.
• Original Medicare – Run by the Federal government and provides both Part A and Part B coverage.
• Medicare Part A – is the hospital coverage Medicare pays for.  You are responsible for the $1,100 benefit period deductible (60 day) when you are hospitalized.
• Medicare Part B- the out-patient coverage Medicare pays for (physician, specialist and surgery services).  There is a $155 annual deductible you need to pay the beginning of  each calender year when you see a physician.
• Part B Premium – All Medicare beneficiaries are required to pay for their Part B coverage.  In 2010 the monthly premium will stay at $96.40 for because of the “Hold-Harmless” provisions in current law.  New Part B members will see a premium of $110.50 for the current year 2010.  Higher income individual and couple rules apply, and may see higher premiums.
• Assignment- an arrangement whereby a physician or hospital agrees to accept the Medicare -approved amount as full payment for services and supplies covered under Part B.  Medicare usually pays 80% of the approved amount directly to the physicians after the beneficiary satisfies the Part B deductible of $155.00.  The Medicare Supplement (Medigap) member pays the other 20%.
• Skilled Nursing Facility – (Medicare Part A) A medical care facility used primarily for rehabilitation.  Patients are typically in a Skilled Nursing Facility when they are recuperating from an accident, illness or surgical procedure.  Medicare typically pays all costs except $137.50 per day.  Medicare will not continue to pay for this service if the person has a degenerative condition.  Meaning, the patients condition should be improving, if not, the coverage is stopped and a Long Term Care policy or Medicaid is necessary to continue to pay for these services.
• Medicare Part D – Medicare Prescription Drug Coverage.  Helps cover the costs of prescription drugs.  Must be purchased from a private insurance company.
• Part B Coinsurance – After the Part B deductible.  Medicare requires you to pay 20% of all Medicare eligible expenses for physician, specialist, ambulance and hospital outpatient services and supplies.
• Excess Charges- When your medical bill for Part B services exceeds the Medicare eligible expense.  For example, if the Medicare allowable charges for certain visit or procedure is $100, Medicare Part B pays $80 and the Medicare Supplement (Medigap) pays the remaining $20, if the Medicare Supplement plan pays for “Excess Charges.” Some plans do not cover this extra charge.
• Initial Enrollment Period – (IEP) Your enrollment is guaranteed if you apply for coverage before or within six month of enrolling in Medicare Part B.  Three months before, the month of, and three months after your Part B effective date.

Medicare Supplement – Monthly Rates

The terms above are some of the most common terms pertaining to Medicare and Medicare Supplement plans, and you should become familiar with these terms when purchasing or comparing plans.

Please feel free to contact me anytime with your questions, or for more information.

Need help or have Questions?

John Conner
Health & Medicare
www.JohnConner.com
john@johnconner.com
800-700-1246 – phone
800-995-9913 – fax