Medicare

Medicare Part B or “Medical Insurance” pays when you visit your doctor in their office and other outpatient care. If you need to enroll in Medicare Part B here is what you need to know.

General Enrollment vs. Special Enrollment

General Enrollment is only open to the public January through March of each year. If you do not qualify for Special Enrollment (see below) your only option for enrolling in Medicare Part B will be the General Enrollment period. To sign up you need to fill out the General Enrollment form, HCFA-40b. (HCFA is pronounced hick-fah) You can pick up this form at your local Social Security office or have one mailed to you by calling Social Security’s toll free number.

The problem with the General Enrollment period, other than the fact that it only opens January through March, is that your Medicare Part B coverage will not start until July 1st of that year. Additionally, if you declined the Part B coverage originally and did not have group health insurance due to employment, (your employment of a family member’s) you can be charged a premium surcharge penalty. This penalty is 10% of the Medicare Part B premium amount for each year you were not enrolled in Medicare.

The Medicare Part B premium for 2006 is $88.50 per month. If you were out of Part B for one year the penalty would be 10% or $8.85. Your monthly premium for Part B coverage would then be $97.35 per month. As you can see, enrolling under General Enrollment can become quite expensive if you are assessed a penalty on your premium amounts.

Qualifying for Special Enrollment

Special Enrollment for Medicare Part B is available to qualified beneficiaries any time of the year. The coverage can be effective immediately and you will not have to wait until July as you would under General Enrollment. To sign up under special enrollment you need a Special Enrollment package, which is available from your local Social Security office or by calling the toll-free number.

To be eligible for Special Enrollment under Medicare Part B you need to have been covered by a group health plan due to current employment. The employment can be yours or that of a family member; as long as you are covered by that health insurance you are eligible for Special Enrollment. The catch is that the health plan must be due to current employment. You or your family member must actually be working; retirement policies do not satisfy this work requirement. If you are retiring and your policy is shifting from work to a retirement policy, you have a six month window to sign up for Medicare Part B. You are allowed three months before you stop work and three months after stopping work to enroll.

If you do not qualify for Special Enrollment and have to sign up under General Enrollment you must have the paperwork submitted prior to March 31st. For more information about your enrollment options, contact Social Security at their toll-free number: 1-800-772-1213.

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Medicare was confusing enough before Part D came along. What is Medicare Part D and how do you enroll in it?

Medicare Part D is prescription drug coverage under Medicare. It was added as part of the Medicare Modernization Act of 2003. This plan is administered by private insurance companies for Medicare. You will need to pick a plan from a provider in your area and enroll with that company.

Medicare Part D has an annual deductible of $250. You will pay monthly premiums for the coverage and the amount you pay depends on the plan you choose. After you meet the annual deductible, Medicare will pay 75% of your prescription costs up to $2250 each year. After $2250 per year you will pay 100% of the cost until your out-of-pocket expenses reach $3600. After the $3600 level is reached you will pay 5% of your cost, or a $2-$5 co-pay, whichever is greater.

There are options for individuals on a fixed-income. Social Security offers a subsidy for Medicare Part D. If you qualify the subsidy will pay your annual $250 deductible and the monthly premiums. Depending on the level of subsidy you qualify for you may only have to make co-payments of $3-$5 at the pharmacy.

To find out if you qualify call Social Security at 1-800-772-1213 or apply online at:

http://www.ssa.gov/prescriptionhelp

Once you have applied for the subsidy, or if you are not eligible based on your income, you need to choose a plan for Medicare Part D. The best way to do this is make a list of all the medications you take, including the brands and the dosage. Call Medicare at their toll-free number (1-800-633-4227) and ask the representative for the Medicare Part D provider list in your area.

Once you have the list of providers, (Providers are private insurance companies that administer prescription drug plans for Medicare) call each of these companies with your list of medications and find out who is going to give you the best deal for the medicines you take. Be careful when selecting a Medicare Part D provider as all the plans are different and may not cover all of your medications. These insurance companies you contact will most likely try and sell you on their plans; after all they are in this to make a buck. You will need to be a shrewd consumer and shop around for the best plan for you. Don’t let a representative push you into a plan that doesn’t meet your needs.

Once you have selected the plan that covers all of your medications with the lowest monthly premiums and the best coverage, you will enroll in that companies Medicare Part D plan. If you get stuck along the way a Medicare representative can answer your questions and get you back on track. Contact Medicare at 1-800-633-4227.

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There are several different ways to qualify for coverage under Medicare. These requirements are for Hospital Insurance (Part A), Medical Insurance (Part B), and Prescription Drug Coverage (Part D).

Most people who are age 65 or older are eligible based on their own employment, or that of a spouse. You qualify for Medicare coverage if you are 65 or older and receive Social Security Retirement or Railroad Retirement benefits. If you do not have ten years of work (40 quarters of coverage) to qualify for Medicare on your own record, you can qualify on a spouse’s work if the spouse is at least 62 years old and meets the ten year work requirement on their own. The spouse can be a former spouse as long as the marriage lasted for ten years or longer.

If you are a Federal, State, or local government employee that did not pay into Social Security but paid into Medicare you will be eligible when you turn 65.

If you are under the age of 65 you can qualify for Medicare coverage early if you have already received Social Security Disability benefits for 24 months. You can also qualify if you have Lou Gehrig’s disease or End Stage Renal disease.

If you receive disability from Railroad Retirement you will be eligible for Medicare after the waiting period; for more information contact railroad retirement.

If you do not meet the eligibility requirements for Medicare you can still enroll by paying the monthly premiums. To sign up for Hospital Insurance under Medicare you will be required to enroll in the Medical Insurance as well. (Both Part A + Part B)

Premiums for Medicare A and B

In 2006 the monthly premium amounts are as follows:

Part A: $393 per month
Part B: $88.50

If you will be turning 65 and are not currently receiving Social Security you should call three months before your birthday to schedule an appointment to enroll in Medicare. If you are still working and are covered by a group health plan due to your employment (or your spouse’s employment) you have the option of declining the Part B coverage so you do not have to pay the $88.50 premium. If you are already receiving Social Security Retirement benefits your Medicare will start automatically on the 1st day of the month you turn 65; you do not need an appointment to enroll.

To enroll in Medicare, contact Social Security at 1-800-772-1214.

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