Note: If you’re in a Medicare Advantage Plan, costs vary by plan and may be either higher or lower than those noted above.  Review the Evidence of Coverage from your plan.

The following information can be found at the Medicare.gov.

If your Medicare card is lost, stolen or damaged, you can ask for a new by visiting the Medicare.gov website.

What is a Medicare Card?

• The Medicare card looks like the red, white and blue card shown here.
• Your Medicare card is your proof that you have Medicare health insurance.
• You can use this application only to request a Medicare card. If you need a Medicaid card, please contact your state Medicaid office.

What You Should Know

• Your Medicare card will arrive in the mail in about 30 days.
• It will be mailed to the address Social Security has on file for you.
• If you need proof that you have Medicare sooner than 30 days, you also can request a letter which you will receive in about 10 days.
• If you need proof immediately for your doctor or for a prescription, visit your nearest Social Security office.
• For security reasons, there is a 30 minute time limit to complete each page. You will be given notice when you are about to time out and can get more time to finish.
• You can read more about Social Security’s Internet policy here.

If You Have Moved

• If you have moved and have not reported this to us, you will need to report this change to us before we can process your request.
• If you have moved and have reported this to us recently, you will need to contact us before we can process your request.

Block access to your personal information

If you want to prevent online and automated telephone access to your personal information, you can block access to your personal information.

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The latest release from the HHS states that,

ACOs create incentives for health care providers to work together to treat an individual patient across care settings – including doctor’s offices, hospitals, and long-term care facilities. The Medicare Shared Savings Program will reward ACOs that lower health care costs while meeting performance standards on quality of care and putting patients first.  Patient and provider participation in an ACO is purely voluntary.

You or someone you know, may have a serious illness and have more than one doctor and taking more than one medication. If so, you have more than likely witnessed how disorganized your doctor’s office is when it comes to your medical information. No one likes to have to repeat the same information at each visit or watching doctors fumble through unsystematic files. It shows just how much our health care system needs to form accurate coordination of information and better communication between health care providers.

Medicare beneficiaries who have five or more chronic conditions suffer the most – and more than have of the Medicare beneficiaries fall into this category. With such serious conditions as diabetes, heart disease and kidney disease, these beneficiaries are very likely to have multiple physicians. These patients are at risk when doctors have failed to coordinate information in their files – so each physician is not sure what the last doctor did or they may not know which medication or dosage was prescribed. This can inevitably lead to the patient not getting the right care they need and there is an increased risk of being prescribed a medication that should not be taken with a medication prescribed by another doctor. It can also lead to complications that require hospitalization – which could have  easily been prevented. A study was conducted on nearly 12 million Medicare beneficiaries which showed that 1 in 5 patients discharged from the hospital was readmitted within 30 days which means if hospitals and doctors were better organized and coordinated with files and communication ”across care settings” , readmission may have been avoided.

Under the proposal of rules, the ACO teams of doctors, hospitals and other health care providers working together would coordinate and improve care for patients with Original Medicare. The proposal lists the following high quality standards in five key areas that ACOs would have to meet: 

• Patient/Caregiver Experience of Care
• Care Coordination
• Patient Safety
• Preventive Health
• At Risk Population/Frail Elderly Health 

Accountable Care Organizations are designed to help patients feel important and make their visit to the doctor a more enjoyable one. Their health care providers will know what conditions their patients have and documented health history will be updated and coordinated among all health care providers. ACOs will also help to improve relationships between health care providers and facilities which will help in making accurate health care decisions for patients. This will lead to less medical mistakes occurring such as the patient not being at high risk of a wrong diagnosis or being given a prescription in error.

An ACO will be rewarded for providing improved health care and for putting the patient’s health and wellbeing  first and foremost. By working on the coordination of information and the communication among physicians, hospitals and other health care providers, we will be on the right path to helping to lower costs and more importantly, improving the health care that Medicare beneficiaries receive.

To read more on Accountable Care Organizations and improving care for Medicare beneficiaries, check out the fact sheet.

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Medicare prescription drug coverage is insurance run by an insurance company or other private company approved by Medicare. There are two ways to get Medicare prescription drug coverage:

1. Medicare Prescription Drug Plans. These plans (sometimes called “PDPs”) add drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private Fee-for-Service (PFFS) Plans, and Medicare Medical Savings Account (MSA) Plans.
2. Medicare Advantage Plans (like an HMO or PPO) are other Medicare health plans that offer Medicare prescription drug coverage. You get all of your Part A and Part B coverage, and prescription drug coverage (Part D), through these plans. Medicare Advantage Plans with prescription drug coverage are sometimes called “MA-PDs.”

If you decide not to join a Medicare drug plan when you’re first eligible, and you don’t have other credible prescription drug coverage, you will likely pay a late enrollment penalty.

How Much Does Medicare Prescription Drug Coverage Cost?

Each plan can vary in cost and drugs covered. The Medicare Drug Plan Finder can help you find and compare plans in your area.

Your Part D monthly premium could be higher based on your income. This includes Part D coverage you get from a Medicare Prescription Drug Plan, or a Medicare Advantage Plan or Medicare Cost Plan that includes Medicare prescription drug coverage. If your modified adjusted gross income as reported on your IRS tax return from 2 years ago (the most recent tax return information provided to Social Security by the IRS) is above a certain amount, you will pay a higher monthly premium.  For more information, visit Social Security’s website.

Many people qualify to get Extra Help paying their Medicare prescription drug costs but don’t know it. Most who qualify and join a Medicare drug plan will get 95% of their costs covered. Don’t miss out on a chance to save. Extra Help and other programs (like Medicare Savings Programs) may help make your health care and prescription drug costs more affordable.

How Do I Get Medicare Prescription Drug Coverage?

To join a Medicare Prescription Drug Plan, you must have Medicare Part A or Part B. To join a Medicare Advantage Plan, you must have Part A and Part B. You must also live in the service area of the Medicare drug plan you want to join.

Remember, costs and coverage varies with each plan. Check out the Medicare Drug Plan Finder can help you find and compare plans in your area. Medicare also has information on quality to help you compare plans.

If you have employer or union coverage, call your benefits administrator before you make any changes, to before you sign up for any other coverage. If you drop your employer or union coverage, you may not be able to get it back. You also may not be able to drop your employer or union drug coverage without also dropping your employer or union health (doctor and hospital) coverage. If you drop coverage for yourself, you may also have to drop coverage for your spouse and dependants.

Once you choose a Medicare drug plan, you may be able to join by completing a paper application, calling the plan, or enrolling on the plan’s Web site or on the Medicare Drug Plan Finder. You can also enroll by calling 1-800-MEDICARE (1-800-633-4227). TTY users should call 1‑877-486-2048. When you join a Medicare drug plan, you will have to provide your Medicare number and the date your Part A and/or Part B coverage started. This information is on your Medicare card. Note: Medicare drug plans aren’t allowed to call you to enroll you in a plan. Call 1-800-MEDICARE to report a plan that does this.

 How Does My Other Insurance Work with Medicare Drug Coverage?

If you have other insurance, find it below to understand how it works with, or is affected by, Medicare prescription drug coverage.

Employer or Union Health Coverage

This is health coverage based on your, your spouse’s, or other family member’s current or former employment. If you have prescription drug coverage based on employment, the employer or union will notify you each year to let you know if your drug coverage is creditable. Keep the information you get.

If you join a Medicare drug plan, you, your spouse, or your dependants may lose your employer or union health coverage. Call your benefits administrator for more information before making any changes to your coverage.

COBRA

This is a Federal law that may allow you to temporarily keep employer or union health coverage after the employment ends or after you lose coverage as a dependent of the covered employee.

There may be reasons why you should take Part B instead of COBRA. However, if you take COBRA and it includes creditable prescription drug coverage, you will have a special enrollment period to join a Medicare drug plan without paying a penalty when the COBRA coverage ends. Talk with your State Health Insurance Assistance Program (SHIP) to see if COBRA is a good choice for you.

Medigap (Medicare Supplement Insurance) Policy with Prescription Drug Coverage

Medigap policiesare no longer sold with prescription drug coverage, but if you have drug coverage under a current Medigap policy, you can keep it. But you may want to join a Medicare drug plan instead, because most Medigap drug coverage isn’t creditable.

If you join a Medicare drug plan, your Medigap insurance company must remove the prescription drug coverage under your Medigap policy and adjust your premiums. Call your Medigap insurance company for more information.

The types of insurance listed below are all considered creditable prescription drug coverage. If you have one of these types of insurance, in most cases, it will be to your advantage to keep your current coverage.

Federal Employee Health Benefits Program (FEHBP)

If you join a Medicare drug plan, you can keep your FEHBP plan, and your plan will let you know who pays first. For more information, contact the Office of Personnel Management at 1-888-767-6738, or visit the Office of Personnel Management website. TTY users should call 1-800-878-5707. You can also call your plan if you have questions.

Veterans Benefits

You may be able to get prescription drug coverage through the U.S. Department of Veterans Affairs (VA) program. You may join a Medicare drug plan, but if you do, you can’t use both types of coverage for the same prescription. For more information, call the VA at 1-800-827-1000, or visit the VA website. TTY users should call 1-800-829-4833.

TRICARE (Military Health Benefits)

Most people with TRICARE who are entitled to Part A must have Part B to keep TRICARE prescription drug benefits. If you have TRICARE, you aren’t required to join a Medicare drug plan. If you do, your Medicare drug plan pays first, and TRICARE pays second. If you join a Medicare Advantage Plan with prescription drug coverage, TRICARE won’t pay for your prescription drugs. For more information, call the TRICARE pharmacy contractor at 1 877 363 8779, or visit the TRICARE website. TTY users should call 1-877-540-6261.

Indian Health Services

If you get prescription drugs through an Indian health pharmacy, you pay nothing and your coverage won’t be interrupted. Joining a Medicare drug plan may help your Indian health provider with costs, because the drug plan pays part of the cost of your prescriptions. Talk to your benefits coordinator – they can help you choose a plan that meets your needs and explain how Medicare works with your health care system.

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The following information is provided by Banyan Administrators:

Arguably the greatest volume of reforms through the Patient Protection and Affordable Care Act (“Affordable Care Act”) signed into law on 03/23/2010 involve Medicare. Some of the provisions are direct reforms to Medicare while other provisions of the Affordable Care Act may have an indirect, but intentional, impact on the program. The following Q&A will give you an overview of the reforms to the Medicare program and how they are all intended to work together.

1.  What are the Medicare Part D reforms?

The first Medicare Part D reform is the closing of the “donut hole”. For Medicare Part D enrollees in 2010, coverage breakdowns as follows: 

• $2,830 – After the enrollee pays the first $310 in drug costs (the deductible), the plan pays 75% of the drug cost up to $2,830 with the enrollee paying the other 25%, then
• $2,831-$4,550 – The “donut hole” – The enrollee pays 100% of their drug costs up to $4,550, then
• $4,551+ – “catastrophic coverage” – The enrollee pays a $2.40 copay for generic drugs. For other drugs the enrollee pays either $6.00 or 5% of the drug cost, whichever is greater.

Beginning in 2010, the reforms going into effect to address the donut hole are: 

• 2010 – Enrollees in the “donut hole” received $250 rebate checks from Medicare
• 2011 – If an enrollee reaches the donut hole, they will be given a 50% discount on the total cost of the brand name drugs while in the gap. Medicare also will phase in additional discounts on the cost of both brand name and generic drugs.
• By 2020 – Effectively close the donut hole so that the plan pays 75% of the drug cost with the enrollee paying the remaining 25%.

The second Medicare Part D reform is the elimination of the Medicare Part D Subsidy paid to employers who sponsor a retiree drug plan. 

The confusion over this reform is that it is not the subsidy that is being discontinued, but, the tax deduction for the subsidy. When Medicare Part D came into effect, if an employer offered a creditable retiree drug plan they could apply for a subsidy from Medicare to pay for the drug costs. Currently, Medicare subsidizes approximately $5 billion in employer-sponsored retiree drug plan costs on an annual basis. This accounts for about 28% of the total cost with the employers funding the remaining 72%. The reform is on the tax deduction an employer can take. Currently, an employer can take a tax deduction on the 72% that they contribute to the plan cost AND take a tax deduction on the 28% Medicare subsidizes for the plan cost. Beginning in the 2013 tax year, the employer can still receive a subsidy from Medicare, but, will no longer be able to take a tax deduction on the amount, as well. By closing this tax loophole, it is estimated that $14 billion in additional tax revenues will be generated on an annual basis. 

A third potential Medicare Part D reform often discussed is to allow the Secretary of Health and Human Services to negotiate drug prices with the pharmaceutical companies on behalf of the Medicare program. Currently, Medicare is prohibited from doing this due to the “non-interference provision” found in the Medicare Modernization Act of 2003 that created Medicare Part D. The idea of eliminating this provision has been discussed before, most notably, in the proposed Medicare Prescription Drug Price Negotiation Act of 2007 as well as in early drafts of the Affordable Care Act. The Act of 2007 passed through the House, but, was defeated in the Senate. In the final language of the Affordable Care Act, the language to eliminate the non-interference provision was removed. In exchange, the pharmaceutical companies agreed to pay billions of dollars in new fees beginning in 2012 and also provide the 50% discount on brand name drugs beginning in 2011 for Medicare Part D enrollees in the donut hole.

Proponents of allowing Medicare to negotiate drug pricing point to the success of negotiated drug pricing in other programs such as Medicaid, Veterans Administration and private plans. They argue that Medicare, with its 45 million members, could achieve comparable results reducing drug costs and benefiting Medicare Part D enrollees.

Opponents of Medicare drug price negotiating argue that it is a myth that Medicare “negotiates” and, instead, Medicare “price fixes” resulting in increased costs being transferred on to private insurance. They also point to the restricted formularies of Medicaid and the Veterans Administration warning that access to certain medically beneficial, but more costly, drugs may be denied resulting in harm to the participant’s health and/or cost shifting to even more costly medical services. 

2.  What are the Medicare Advantage reforms?As noted earlier, with the introduction of Medicare Part C in 1997, the government pays a subsidy to the private insurer for every Medicare eligible who enrolls in a Medicare Advantage plan. The belief was that the private insurance industry could better manage claim costs than Medicare by offering a variety of plan options (HMO, PPO) and designs. In 2010, the results might prove otherwise.

The Medicare Payment Advisory Council (MedPAC), an independent congressional committee, estimates that due to the Medicare subsidy, it costs Medicare 14% more to cover a Medicare Advantage participant than it does a traditional Medicare participant. MedPAC estimates that the elimination of the Medicare Advantage subsidy will save between $15-$17 billion, annually, and $169 billion over a ten year period. This savings would extend Medicare solvency another 18 months.

Proponents of the elimination of the Medicare Advantage subsidy argue that it is not right that traditional Medicare participants are subsidizing the retirees who choose to enroll in Medicare Advantage plans. They also argue that Medicare Advantage plans may be obsolete. Two of the most appealing aspects of Medicare Advantage plans are avoiding the Medicare Part D donut hole and having free preventive care services both of which have been addressed by the Affordable Care Act. Lastly, they speculate that the subsidy is not being used as intended (improve participants’ benefits and/or reduce participants’ costs) and is instead going towards the private insurers profits. They point to recent, proposed double-digit Medicare Advantage plan rate increases that have been reduced to a 1% decrease after Department of Health and Human Services involvement as proof that the Medicare Advantage plans must be profitable to the private insurers to want to continue offering them.

Opponents to the elimination of the subsidy cite that any higher costs in the plan come due to a higher level of benefits than Medicare. Again they argue that Medicare does not “negotiate” but “price fixes” thereby shifting costs onto the private insurance industry. Opponents also may include the 10.3 million or 22.3% of all seniors in 2008 currently enrolled in Medicare Advantage plans, a number enrolled that has doubled over the previous 5 years indicating participants like the plans. Opponents also argue that eliminating the subsidy will result in private insurers discontinuing Medicare Advantage plans. They point to the 09/30/2010 announcement by Harvard Pilgrim, Massachusetts second largest insurer, that they are no longer offering Medicare Advantage plans as they do not see those plans being a viable option going forward. As a result, 22,000 Massachusetts seniors will need to find other coverage options to fill the void in 2011.

3.  What do I need to do now?Changes in Medicare impact all of us as citizens of the United States more than it does sponsors of employer-based group health plans. For that reason alone, you will want to stay informed on the Medicare related reforms. Still, as an employer you should develop a potential strategy to address the changes in the workplace these reforms may bring. For example:

• Employment – With changes in Medicare benefits and options along with increases in the Medicare qualifying age will you see more workers wanting to work well past 65? What impact will that have on your workforce and productivity?
• Benefits – These older employees will also be impacting the cost of the company’s benefit plans. Also, what of the spouses of these employees who may have been covered on a former employer’s now discontinued retiree drug plan? Will you see increased cost as they join your benefit plans?
• Compensation – With changes to the FICA tax rate and the tax on investment income, might you see your highly-compensated employees actually declining pay increases in favor of other forms of compensation?

If you have any questions on this health care reform provision, please discuss with a member of your Banyan Consulting team.

Medicare and Medicaid Services.

Today, November 15, Medicare’s Open Enrollment period begins, and runs it runs through December 31. Open Enrollment offers people with Medicare—-including those with Original Medicare—an opportunity to review their current health and prescription drug coverage; compare health and drug plan options available in their area, and choose coverage that best meets their needs.

Although this is an annual event, this year is an especially important time for people with Medicare to take advantage of the Open Enrollment period. The Affordable Care Act provides new benefits to most people with Medicare in 2011, including:

• A 50% discount on covered brand name drugs if you hit the prescription drug ‘donut hole,’
• A free annual wellness visit, and
• No co-pays for recommended preventive services

If you or someone you love has Medicare, checking out some options during Open Enrollment may result greater savings or even better coverage than you have this year.

For assistance during Open Enrollment, visit www.medicare.gov, consult your 2011 Medicare & You Handbook, or call 1-800-MEDICARE. You can also get one-on-one counseling assistance from your local State Health Insurance Assistance Program (SHIP).

Here at the Centers for Medicare and Medicaid Services (CMS), we are working hard each and every day to ensure that Medicare stays strong, and that people with Medicare have access to quality, affordable care. We encourage all seniors and people with disabilities in the program, to look at their current coverage, compare it to the options available, and decide which coverage best meets their needs during this Open Enrollment period.

Note: Remember—protect your personal information—don’t give out your Medicare number to anyone who arrives at your home uninvited, calls you and asks for it, or offers you free equipment or services in exchange for your Medicare number. Guard your Social Security and Medicare numbers like you would your credit cards. (Visit stopmedicarefraud.gov for more information.)

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If you missed the first article in this series that was posted last week, click here.

The following information is provided by Banyan Administrators:

Arguably the greatest volume of reforms through the Patient Protection and Affordable Care Act (“Affordable Care Act”) signed into law on 03/23/2010 involve Medicare. Some of the provisions are direct reforms to Medicare while other provisions of the Affordable Care Act may have an indirect, but intentional, impact on the program. The following Q&A will give you an overview of the reforms to the Medicare program and how they are all intended to work together.

1.  What is the future of Medicare?

What could not have been foreseen in 1965 when Medicare was created was that the United States was coming to the end of the post-World War II “Baby Boom”. More “Baby Boomers” are reaching Medicare eligibility than are being replaced in the work force by younger workers.  With Medicare being funded by FICA taxes, at some point, it mathematically becomes impossible to fund all the benefits for all the Medicare enrollees.

Currently, there are 3.9 workers paying taxes into Medicare for every Medicare enrollee. As the baby boomer generation retires, the number of workers paying taxes into Medicare will shrink to 2.4 by 2030. Beginning in 2008, Medicare first began spending more in benefits than it was receiving in tax funding. Life expectancies continue to increase meaning Medicare enrollees will continue receiving benefits for a longer period of time. Medical inflation continues to rise increasing costs. Many dire predictions are made regarding the solvency of the Medicare program. Some “doom and gloom” estimates are that Medicare will be insolvent by the end of the decade. Others predict that Medicare will still be an option when they retire, however, what it will look like and at what age they will be able to enroll in the program remains to be seen.

2.  So how does the Affordable Care Act reform Medicare?

Primarily, the Affordable Care Act reforms the Medicare program in three ways:

• FICA Tax Changes
• Medicare Part D Reforms
• Medicare Advantage Reforms

3.  What are the FICA tax changes? 

The major change is an increase in the FICA tax rate on wages for high-income earnings. Effective with the 2013 tax year that begins on 1/1/2013, employees earning over $200,000 annually (and $250,000 for married couples filing jointly) will see their withholding percentage increased from 1.45% to 2.35%. The employer contribution will remain at 1.45%. This 0.90% increase in the FICA tax withholding percentage is estimated by the Congressional Budget Office to generate $87 billion in additional tax revenues over a ten year period.

In addition for the 2013 tax year, there will also be an assessment on unearned income for higher-income taxpayers. Unearned income includes capital gains, dividends, interest, annuities, royalties, and rents. The tax is 3.8% of the individual’s net investment income for the year or the amount of the individual’s modified adjusted gross income. What this means is that some individuals may be below the $200,000 annual compensation limit and not subject to the higher FICA tax rate, but, due to their amount of unearned income they may be subjected to the 3.8% tax either due to their net investment income or after adjusting their gross income.

Combined with FICA tax rate change, these two tax changes are estimated to generate an additional $210 billion in tax revenues over the next ten years. Combined, this is the single largest funding mechanism of the Affordable Care Act.

The following information is provided by Banyan Administrators:

Health Care Reform – Medicare

What You Need to Know Now About: Medicare

Arguably the greatest volume of reforms through the Patient Protection and Affordable Care Act (“Affordable Care Act”) signed into law on 03/23/2010 involve Medicare. Some of the provisions are direct reforms to Medicare while other provisions of the Affordable Care Act may have an indirect, but intentional, impact on the program. The following Q&A will give you an overview of the reforms to the Medicare program and how they are all intended to work together.

1.  What is the history of Medicare?

As early as 1945, President Harry S. Truman proposed a government administered national social insurance program. It was not until the Social Security Act of 1965 signed into law by President Lyndon B. Johnson that the Medicare program was created. The first senior enrolled into the Medicare program was former President Harry S. Truman. Former First Lady Bess Truman was the second senior enrolled.

The first two programs created in 1965 were Medicare Part A and Medicare Part B. Since that time, Medicare Part C (1997) and Medicare Part D (2006) have been added.

Medicare Part A is hospitalization insurance providing coverage to the Medicare enrollee for inpatient hospital stays. Medicare Part A also pays for other facility-based skilled services such as care at a skilled nursing facility, but, on a limited basis. Most Medicare enrollees do not pay a premium for Medicare Part A coverage because they (or a spouse) have paid enough into the program through payroll taxes prior to retirement. Medicare enrollees do have to meet a Medicare Part A deductible before any benefits are paid. In 2010, the Medicare Part A deductible is $1,100 for an inpatient stay up to 60 days.

Medicare Part B is medical insurance providing coverage to the Medicare enrollee for outpatient services provided by a physician. Services include physician services, nursing services, x-ray, laboratory and diagnostic tests, vaccinations, renal dialysis, outpatient hospital procedures, etc. No benefit is provided for prescription drugs unless the drug is administered by a physician. Participation in Medicare Part B is voluntary if an eligible retiree wishes to participate; the premium amount will be deducted from his social security benefit. In 2010, Medicare Part B monthly premium, on average, is $100.50. The Medicare Part Benrollee also has to meet a $155 deductible and then pay 20% coinsurance.

In 2008, there were 45 million enrollees in Medicare making it the nation’s largest single health care payer in the nation. By 2030, it is expected that enrollment will reach 78 million. In 2008, Medicare spending reached $599 billion which was 20% of the total federal government spending. At $599 billion, Medicare is only surpassed by Social Security and defense spending.

Medicare Part C, also known as “Medicare+Choice”, was created by the Balanced Budget Act of 1997. At that time, the government was attempting to cut $155 billion from the Medicare program by allowing private insurers in the health insurance industry to offer “Medicare Advantage” plans to Medicare beneficiaries. For every Medicare beneficiary who enrolled in a Medicare Advantage plan, the Medicare program pays a subsidy to the private insurer. 

Whereas traditional Medicare Parts A & B offers a standard benefit package that covers medically necessary care, the Medicare Advantage plan can provide an expanded level of coverage including prescription drugs, dental care, vision care, and even health club memberships. Medicare Advantage enrollees often have a variety of plan designs to choose from very similar to the types of employer-sponsored plans they had access to pre-retirement. The plan may have a limited provider network for the enrollee to seek care; however, if the enrollee uses an in-network doctor, he may receive a greater level of benefit than he would through traditional Medicare. Another important distinction between traditional Medicare and Medicare Advantage plans is that the latter, typically, encourages preventive care and wellness care at little to no out-of-pocket cost for the enrollee.

Of course, with the expanded level of coverage the Medicare Advantage enrollee typically will pay an additional premium for the coverage in addition to the Medicare Parts A & B premium. Still, the popularity of the Medicare Advantage plans continues to grow. In 2008, 10.3 million of all Medicare eligible seniors (22%) were enrolled in a Medicare Advantage plan. This is double the enrollment from 2003.

Medicare Part D went into effect in 2006 after the passage of the Medicare Prescription Drug, Improvement and Modernization Act of 2003. Medicare Part D is similar to the Medical Advantage plans in that they are designed and administered by private health insurance companies, however, the coverage is limited to prescription drugs. Any enrollee in traditional Medicare Parts A & B can also enroll in Medicare Part D. Unlike Medicare Parts A & B, the coverage designs of Medicare Part D plans are not standardized and private insurers can offer a variety of plan design options within certain guidelines.

Of course, there is an additional cost to enroll into Medicare Part D. If a Medicare eligible beneficiary does not enroll into Medicare Part D when first eligible and then decides to enroll in the program, they will have to pay a penalty unless they can provide a “Certificate of Creditable Coverage” documenting they had drug coverage through another source at the Medicare Part D level, or better, of coverage. Sources could include an active employer plan because either the Medicare eligible beneficiary or a spouse is still actively employed. Another source could be through an employer-sponsored group early retiree or retiree drug program.   For those employers sponsoring creditable drug coverage, they may be eligible for subsidies from the Medicare program.

2.  How is Medicare Eligibility defined?

In general terms, to be eligible for Medicare, an individual must be:

• Age 65 or older;
• Legal resident of the United States for, at least, 5 years; and
• Paid Medicare taxes for a minimum of 10 years.

If the individual (or a spouse) has not paid Medicare taxes for the minimum of 10 years, they can still enroll in Medicare, but, will be charged a monthly premium.

Medicare taxes are paid through the Federal Insurance Contribution Act (FICA) of 1954. The FICA tax is, currently, 2.9% based upon the worker’s wages, salaries and other compensation in connection with employment. The employee pays 1.45% of the tax with the employer paying a matching 1.45% contribution.

New to Medicare? 6 Things You Need to Do

Use this checklist to get the most from your Medicare benefits and make sure your claims get paid quickly and correctly.

1. Fill out an Initial Enrollment Questionnaire
The Initial Enrollment Questionnaire (IEQ) should come in the mail about 3 months before you qualify for Medicare. It asks about other health insurance you have that might pay before Medicare does, like group coverage you have from your employer or through a family member, treatments covered under liability insurance, or workers’ compensation you get.

You must fill out and return this questionnaire to make sure your medical bills get paid correctly and on time. You can:
• Mail back the paper copy you got in the mail.
• Complete the questionnaire online at MyMedicare.gov
• Complete the questionnaire over the phone by calling the Coordination of Benefits Contractor at 1-800-999-1118. TTY users should call 1-800-318-8782.

2. Fill out an Authorization Form
Medicare can’t give personal health information about you to anyone unless you give permission in writing first. If you want your loved ones to be able to get information about your care, it’s a good idea to provide authorization in advance. You can do this in several ways:

• Fill out and submit an e-Authorization Form online: Medicare Online Forms.
• Download and complete a .PDF version of the Standard Authorization form: Medicare Online Forms. Mail the completed, signed form to Medicare BCC, Written Authorization Department, P.O. Box 1270, Lawrence, KS 66044.
• Call 1-800-MEDICARE (1-800-633-4227) and ask for the Standard Authorization form to complete and mail in. Or, the CSR can help you complete the form over the phone, then mail the form to you to sign and return.

3. Make a Physical Exam Appointment
Medicare covers a one-time “Welcome to Medicare” physical exam if you get it within the first 12 months you have Part B. This exam includes a review of your health and counseling about preventive screenings, shots, and referrals for other care you may need. Call your doctor to schedule your “Welcome to Medicare” physical. You pay 20% of the Medicare-approved amount, and the Part B deductible doesn’t apply.

4. Sign up for MyMedicare.gov
MyMedicare.gov is a secure online service where you can access your personal Medicare information 24 hours a day, every day. Here’s what you can do with MyMedicare.gov:

• Complete your Initial Enrollment Questionnaire (IEQ)
• Track your health care claims
• Order a duplicate Medicare Summary Notice (MSN) or replacement Medicare card
• Check your Part B deductible status
• View your eligibility information
• Track your preventive services
• Find information about your Medicare health or prescription drug plan, or search for a new one
• Keep your Medicare information in one convenient place
• Sign up to get the “Medicare & You” handbook electronically

5. Choose and Join a Medicare Drug Plan (Part D)
If you want Medicare prescription drug coverage, now is the time to join a Medicare drug plan. You can join, switch, or drop a Medicare drug plan at these times:

• When you first become eligible for Medicare
• Between November 15 – December 31 each year

If you’re newly eligible for Medicare, you have 7 months to join a Medicare drug plan. This 7 month period starts 3 months before you become eligible, includes the month you become eligible, and runs for 3 months after you become eligible. This is true whether you’re eligible for Medicare because of your age or a disability. If you’re eligible for Medicare because of a disability, you’ll have another chance to join a Medicare drug plan when you turn age 65.

Click here to get started with a list of Medicare drug plans in your area. Once you choose a Medicare drug plan, you may be able to join by completing a paper application, calling the plan, or joining online.

6. Download a Copy of “Your Medicare Benefits”
Medicare’s official “Your Medicare Benefits” publication explains the rules about which health care services and supplies Medicare covers, what specific benefits you can get, and when you can get them. It also explains how much Medicare pays for each service, and how much you pay. Includes a list of resources where you can get help with questions.

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