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How to Review Your Medicare Coverage for 2019

If you use Medicare for your healthcare or prescription drug coverage (Medicare Advantage plan or Medicare Part D), you should have received a letter in the mail in September regarding your current plan. If you are unsure what this letter means, it’s simply a notice telling you what changes will be made to the plan in the upcoming year, if any. This letter is sent out every year to anyone with Medicare Advantage or a Medicare Part D drug plan. It’s known as the Annual Notice of Change and Evidence of Coverage (ANOC). This letter should have been sent out by September 30, or 15 days before the start of the window when it’s possible to change your Medicare plan. Here’s what you need to know about it.

Why Read this Notice?

The ANOC is important to Medicare plan holders as it gives details of changes that will be occurring within your plan. Unfortunately, these notice letters usually warn you of increased premiums or reduced coverage rather than beneficial changes. For example, a change could include your plan no longer covering a service or prescription you use regularly, and if you don’t find a new plan that does meet your coverage needs, you could face larger out-of-pocket expenses for the same things that were covered just last year.
The Annual Notice of Change letter is sent out early enough before the Medicare Annual Election Period (AEP) — also called the Medicare open enrollment period — that runs from October 15 to December 7 each year. This is when you can make changes to your Medicare plan. If you notice that the changes being made to your current Medicare plan no longer make it your best option for coverage, you will have time to research other plans and select a new one during open enrollment.
If you haven’t received this ANOC letter by now, reach out to your Medicare insurance carrier so you can examine any upcoming changes and determine whether or not you should change your coverage. You may also decide to choose a new plan if your health has changed, unrelated to the new changes in your previous Medicare plan.

What to Pay Close Attention To

Some of the most common changes in your Medicare plan outlined by the ANOC include premiums, formularies (prescriptions covered), and deductibles. Depending on your own personal healthcare needs, you should take the time to add up your average expected payments. Many people only look at premium prices when shopping for insurance or reading their ANOC, but deductibles and formularies can have an equally important impact. Pay attention to:


A small increase in your monthly premium may not seem like a lot, but over the course of a year the additional cost can really add up. Medicare Advantage and Part D premiums may actually be lower for many customers in 2018, so shop for a good plan to maximize your savings.


If your ANOC notifies you that your prescription drug coverage will be changing, go to the Medicare website or call your plan to check the coverage status of your prescriptions for the dosage you take. Under some plans, you can save money by switching to the generic brand of your prescription. Other plans will require that you try the generic brand of your prescription first before they will cover the brand-name version.


The deductible, which is what you have to pay before your insurance carrier will pay for its share of your healthcare costs, may increase. If that’s the case according to your ANOC, consider switching to a plan with a lower deductible as long as its premiums aren’t enormous by comparison. Lower-deductible plans typically have higher premiums, but they may cover a greater percentage of your medical expenses.

The 2019 Annual Enrollment Period (AEP) for Medicare

The 2019 annual enrollment period (AEP) for Medicare started on October 15, 2018 and runs through December 7, 2018. Whether you’re new to the program or want to switch to a different kind of coverage, here are important dates and deadlines to keep in mind:

  • October 15th: Medicare open enrollment starts. This is your chance to switch from original Medicare to Medicare Advantage (Part C); drop Part C coverage and enroll in original Medicare; switch from one Advantage plan to another; or drop, switch or sign up for a Medicare Part D drug plan.
  • December 7th: The Annual Enrollment Period for Medicare ends for coverage in 2019.
  • January 1st: Any changes that you made during the 2019 annual enrollment period for Medicare will take effect on the first of the year. If you signed up for a new plan, it’ll start on the first as well.
  • January 1st – February 14th: This is the annual Medicare disenrollment period, specifically for Advantage plans. During this period, you can do two things: drop Advantage to enroll in original Medicare, and sign up for a Part D drug plan if you enroll in original Medicare.

Initial Enrollment Period (IEP)

The annual open enrollment period applies to existing Medicare enrollees. If you haven’t signed up for any portion of Medicare yet, and you’ll be eligible based on age soon, then you’ll sign up during what’s called the “initial enrollment period” (IEP) or initial eligibility window. It’s a 7-month enrollment period that starts three months before the month you turn 65 and runs for three months after your birthday month.
You can sign up for original Medicare or Medicare Advantage during this time frame. In fact, it’s the best time to sign up because you may have to pay a penalty if you wait to enroll outside this period. If you miss your IEP, you can enroll in Medicare Parts A and/or B (original Medicare) during the general enrollment period, which runs from January 1 through March 31 each year.

What If I Miss Open Enrollment?

Unless you qualify for a special enrollment period, you need to sign up for original Medicare or Medicare Advantage during your initial eligibility window. You can also use open enrollment. But keep in mind that there are fees for signing up late (outside of your initial window), and they differ based on each portion of Medicare as follows:

  • Part A: The penalty for late enrollment into Part A is 10 percent, if you’re one of the few Medicare beneficiaries who pays a premium for hospital coverage. Most people don’t pay a premium, but if you do, your rate goes up 10 percent and lasts for twice the number of years that you could have had Part A but chose not to.
  • Part B: For Part B, the late enrollment penalty is 10 percent on top of your monthly premium for each full 12-month period that you could have had Part B but chose not to. The penalty lasts for as long as you have Part B coverage.
  • Part D: Medicare calculates Part D late enrollment penalty differently from Parts A and B. For Medicare Part D, you’ll pay 1 percent of the “national base beneficiary premium” times the number of full months that you didn’t have Part D or creditable drug coverage.
    • In 2019, the national base beneficiary premium is about $32.50 a month.
    • If you sign up late for Part D, then you’ll pay 1 percent times the number of months you didn’t have coverage, on top of whatever premium your plan charges.
    • The fee lasts for as long as you have Part D coverage.

You may be able to enroll in Medicare outside of your initial window without worrying about a penalty for late enrollment. Special enrollment periods exist for different cases, such as losing group coverage from work or being disabled. Check with Medicare to make sure.

New Rules on Medicare Home Health Care

On January 9, the Centers for Medicare & Medicaid Services (CMS) toughened the health and safety standards a home health agency must meet to be a Medicare or Medicaid approved provider. Approximately 12,600 home health agencies currently provide home health services to more than 5 million Medicare and Medicaid beneficiaries. Such agencies provide a broad range of services, including skilled nursing care, physical therapy visits and social work services for individuals in the comfort and privacy of their own homes. Since all services are supervised by physicians and performed by an array of properly credentialed professionals, you can expect greater care and safety. The new standards are based on research in patient education and medicine, so they have the potential to improve on the Medicare program in a number of ways.

Overhauled Agency Procedures

Good care begins with an efficiently run home health agency fully committed to improvement. As leadership has a major impact on the success of an organization, Medicare is increasing the qualifications for home health administrators and clinical managers. In terms of administration, the new standards also call for a simplified organizational structure. Although chain of command will likely be simplified with the new standards, such hierarchy won’t be eliminated entirely. The common structure of a parent agency that oversees branches will be retained. This kind of structure allows the overall business model to grow while catering to the needs of local markets. In turn, it helps consumers by making sure that Medicare as an agency understands individual needs, especially when it comes to home healthcare.
The CMS also wants to improve customer satisfaction by requiring individual agencies to implement ongoing evaluation to enhance patient care. Although quality assessment and performance improvement (QAPI) may be a new term to much of the general public, its basic premise is not. Home health agencies are expected to collect objective data on their own performance, reflect upon it and use it as the basis for improving patient care. CMS has, in fact, used QAPI to devise many of its new standards.

Increased Understanding

One aspect that’s seen great improvement via new standards is increasing understanding among healthcare professionals and patients. Without clear communication, true healthcare is not possible. To that end, CMS has instituted an integrated communication system that requires healthcare workers across disciplines to continually identify and respond to patient needs. Timely and detailed interaction among all professionals involved in home care that will lead to faster, more focused intervention.
Patients are also expected to directly benefit from this set of standards, as a key component of the new standards is providing each home care patient and their caregivers with written direction regarding:

  • Treatments
  • Medication administration
  • Daily care requirements
  • How to contact their home health agency clinical manager

Providing simple, written instructions will help patients more easily access the care system. It’s also more economical. Research in 2007 showed that patient costs were reduced by 33 percent within one month of providing clear discharge instructions to patients.

Better Care

In addition to increased patient satisfaction and participation within the healthcare system, improving communication also enhances patient care. The CMS issues mandates to make sure that patients get the care they need. One example is improved screenings in a patient’s overall well-being. While patients already receive fairly thorough physical and mental health assessments, more stringent requirements will allow home care consumers the chance to receive earlier treatment for conditions, like depression, that can easily be overlooked in elderly home care patients.
The new standards also give consumers and families the opportunity to take charge of their own healthcare. Requiring patients, families, and caregivers to be educated in standard infection control practices can reduce infection and hospitalization rates. Handwashing is one such practice since it’s easy to do and offers exceptional returns for preventing the spread of germs. These practices, of course, are only as good as how they’re implemented. But since increased supervision of all home healthcare workers is also an integral part of the new standards, quality of care and assessment measures should also improve with time.

The Bottom Line

The new CMS standards for home healthcare agencies are based on established research and standards of practice common to hospitals, clinics and other healthcare facilities. Streamlining agency structure will improve patient outcome, as will raising accountability and offering guidelines for best practices across the industry. The end result should be better patient care, more satisfied Medicare beneficiaries and more responsible use of the program’s resources.

Medicare’s Quality Payment Program

The Centers of Medicare and Medicaid Services (CMS) estimates that around 55 million Americans rely on medical treatment through Medicare. For years, the CMS has been trying to balance the quality of care given with keeping overall costs down. Responsible for administering the Medicare program, the CMS believes that a value-based payment (VBP) model is the future of health care reimbursement and that this system will replace the fee-for-service (FFS) model that is currently in place.
The rules in place regarding the use of technology in storing and transmitting medical practice information (found primarily in the HIPAA laws) have instigated a lot of change in the medical industry. The CMS is doing its part to bring technology into the medical field by introducing the quality payment program (QPP). This program is part of the Medicare Access and CHIP Reauthorization Act of 2015 that was revised in 2016 to streamline the process of paying medical technicians and encourage medical practices to update their technology, while focusing on quality of care.

What is the QPP?

The quality payment program (QPP) is the first stage of what the CMS estimates will be a long-term approach to altering the way clinicians are paid. Payments based on quality of care reforms previous payment models that reimbursed clinicians for their work with Medicare Part B patients. It’s a new payment model that brings together several other segments of other payment formats, and gives clinicians a much more defined path towards increasing their income and becoming a quality provider in the eyes of the CMS.
Clinicians participate in the QPP by using either advanced alternative payment models (APM) or the merit-based incentive payment system (MIPS). The MIPS was created when several existing programs were combined into one program that streamlined a significant portion of the clinician payment process. The APM path rewards medical practices for getting more involved with the care of their patients and assuming some level of risk with patient treatment. The MIPS path is made up of a series of quality grades used by the CMS to determine what type of pay adjustment (up, down or neutral) a medical practice gets based on their grades.

How Will the QPP Alter Medicare?

There are two primary focuses of the new quality payment program:

  • To increase the quality of care while keeping costs down
  • To create incentives for medical practices to update their technology

The MIPS model includes tasks for improving office technology that a medical practice can perform to earn points towards a possible payment increase. The quality payment program is also set up to continue the CMS’s migration towards a value-based payment (VBP) system and away from the fee-for-service model that’s currently being used. Much of the information that is delivered to the CMS to grade clinicians is included in each Medicare claim that clinicians file, but some of the information has to be reported by the clinicians to count towards their grades.

Why Would Clinicians Get Involved in the QPP?

By the year 2022, clinicians can earn payment bonuses of up to 9 percent of all of their annual billings if they comply with the quality payment program. For practices that get involved with the advanced alternatives payment models (APM), Medicare will award an extra 5 percent payment bonus since these practices are shouldering additional risks when treating patients.
While the CMS makes it financially tempting to join the QPP, it also punishes ambivalence. Any provider that does not submit at least one report in a year will be hit with a 4 percent payment penalty. If a practice submits just one report, it can avoid that automatic penalty.

What About Smaller Practices?

To qualify for the QPP program, a practice has to bill at least $30,000 to Medicare in one year and see at least 100 Medicare patients in the same time period. Very small medical practices will not have to worry about the requirements of the program, but any small rural practice wishing to participate can contact the CMS about special conditions set up specifically for rural providers.
Participation in the QPP is mandatory for qualifying medical practices. This brings up the issue of the costs of technology upgrades for practices that meet the criteria, but do not have the financial resources to upgrade their business operations. There is a considerable financial investment required by a medical practice before it qualifies for the payment bonuses, and some practices cannot afford those investments.
Organizations such as Quality Improvement Organizations and Regional Extension Centers do offer assistance to smaller practices in upgrading equipment and investing in new processes, but there are limited resources available to only a small number of practices. The business decisions some smaller practices may have to make could involve selling to a larger practice or obtaining third-party financing.

The Timeline

Medical practices that feel they are ready to get involved in the QPP right away can start reporting their data on January 1, 2017. The CMS has set a deadline of October 2, 2017 for all qualifying medical practices to be involved in the program. A practice can choose to get involved in the program at a low level, or it can decide to become a full-time member. The CMS recommends that providers get involved full time with the program on January 1, 2017 to receive all of the benefits the program has to offer, and to stay up-to-date on requirements and other information.
Payment increases or decreases will be assigned by January 1, 2019 for practices that report data in 2017. Payment adjustments go up one percent per year from 2019 to 2022 until they reach the maximum of 9 percent. The QPP is not an all-or-nothing program. Practices can either qualify for a partial payment increase, or they could be hit with a partial payment deduction.
The CMS is using its new quality payment program to offer incentives for medical practices to update their technology and provide high-quality care to every patient. Since the program is just getting underway in 2016, any clinician who treats patients through the Medicare Part B program will want to stay updated on the changes each year as they occur.

Choosing a New Medicare Advantage Plan During Open Enrollment

Medicare open enrollment is now in progress and will run through December 7, 2016. If you haven’t signed up yet, it’s time to enroll, reassess your current coverage and check your prescription plan formularies and tiers for pricing changes.
As a Medicare beneficiary, you can enroll in a Medicare Advantage plan instead of traditional Medicare. If you have traditional Medicare, you can add prescription drug coverage, which is Part D. Each year, members are given about seven weeks to sign up for new plans or make changes to existing coverage.
The focus of Medicare plans over the years has shifted from saving for health care to accessing more private plans with broader benefits. The Affordable Care Act (ACA) integrated the use of a quality star rating system, making it easier to identify plans with satisfied customers. Medicare Advantage is becoming increasingly popular. According to the Kaiser Family Foundation, 31 percent of people who qualify for original Medicare (Parts A and B) prefer to combine those benefits in a private Part C plan, also known as Medicare Advantage, that often includes prescription drug coverage.
Depending on your personal medical needs, you may be perfectly content with original Medicare or need more comprehensive coverage. The choice is yours, but you can only sign up from October 15 through December 7 outside of your initial eligibility window.

How to Find Medicare Plan Information

Where should you start during Medicare open enrollment? First, you need to know what’s available in your area. Plan descriptions are readily accessible on via the Medicare Plan Finder. Don’t bother with the prescription drug page when you’re first exploring your options. The best recommendations for hospital and primary care will be different than the selection for the top prescription care. Choose the plan that has the combination more closely suited to your individual circumstances.
Once you’ve identified some plans that might work, click on the title of each one followed by the “benefits” tab to learn more about its features. Keep in mind that premiums are not the only indicator of cost. Look carefully at the copays, coinsurance and deductible amounts. The higher the deductible is, the lower the premium will be. Again, you are looking for something that works best for your budget. You have two options:

  • High premium, lower out-of-pocket: Pay more up front in monthly premiums and less at the time of medical care.
  • Low premium, higher out-of-pocket: Pay a lower monthly premium and more when you visit the doctor or get your prescription filled.

For the greatest deal, find out how well each plan pays for services that you use regularly. Plans with the circled letters D, H or V also include dental, hearing or vision benefits, respectively.

The Difference Between HMOs and PPOs

Insurance terms can be confusing, especially if you’re new to Medicare. Medicare Advantage plans operate like health maintenance organizations (HMOs) and preferred provider organizations (PPOs). The Kaiser Family Foundation reports that 64 percent of Medicare Advantage enrollees prefer HMO plans to PPOs.
HMOs require a primary doctor to coordinate care and give referrals to see specialists. You must use the doctors within the network to guarantee payment for services, except during an emergency. Serving local areas, they cost less but have fewer provider options. If you’re not attached to your provider, or you’re confident that she’s in your HMO network, then an HMO can be a good option for you.
PPOs let you pick your doctors, but you’ll get a price discount for using one in their network. Coverage is better when you stay within the plan’s list of participating providers. A PPO may be the best option if you have a doctor you like and trust who is not in the network. These types of plans have service networks that can cover both local areas, like counties, and regional areas, including entire states. They cost more because you have more options.
Call your doctor’s office or look for your physician’s name or practice on Medicare’s plan provider lists to see if he participates in the plan that you’ve chosen. You may need to change the plan or change your doctor to keep costs down.

The Final Determination

Once you’ve settled on a few possible plans, make a list of those plan names and individually search them using the Medicare Plan Finder. Add in your prescriptions when prompted. Creating a list beforehand will help expedite the process and save you some frustration. Note that proper spelling and dosage are critical elements for your prescriptions. You’ll need to make sure that your drug plan not only covers your medication, but also covers the amount that you need and how often you need to take it.
Compare these results against the original list, the one that doesn’t include your prescriptions, to find plan options that appear on both lists. Next, check the star rating, which will tell you how good the plan is based on factors like customer satisfaction and whether it successfully manages chronic illnesses. A rating of 3.5 or better is suggested overall.
After you’ve enrolled in a new Medicare Advantage plan, the plan will automatically notify original Medicare of the change, so you shouldn’t have to worry about gaps in coverage or an interruption in services. Remember that you can only sign up until December 7 this year, so start soon if you haven’t already.

New Study Shows Medicare Enrollees Spending Less Time in Hospitals; Better Health

On this, the 50th anniversary of Medicare, new research shows that the overall health of American enrollees is dramatically improving and that hospital expenses are falling.
Enrollees becoming healthier and for longer
With millions of baby boomers now turning 65, they’re becoming eligible for Medicare. As such, the program’s population will continue to grow. This, in turn,  increases overall costs for Medicare, even as the average cost per illness or hospitalization comes down. The study’s researchers noted that mortality rates have also dropped steadily during that time. These beneficiaries were found to be less likely to end up in the hospital. But as older Americans live longer, they’re taking advantage of their Medicare coverage for more years than previous generations.
These improvements in hospital stays and mortality are great news for the American public and the nation’s healthcare system. But they also spotlight just how effective and well-run Medicare itself has become over the last 15 years, due to the combined efforts of doctors, hospital s and the U.S. government. “The results were rather remarkable,” states Dr. Harlan Krumholz, a cardiologist and leading Yale health care researcher. “We found jaw-dropping improvements in almost every area that we looked at.”
“If the rates had stayed the same in 2013 as they had been in 1999, we would have seen almost 3.5 million more hospitalizations in 2013, says Krumholz. “People who were being hospitalized were having much better outcomes after the hospitalization. They had a much better chance of survival.”
Medicare improvements reducing healthcare costs
Research suggests that the overall improvements to Medicare have had a very positive economic impact. A Yale University study published in the the Journal of the American Medical Association shows that hospital stays have actually fallen over the last 15 years. Specifically, for Traditional Medicare beneficiaries, average hospital stays have fallen from $3,290 to $2,801 (in inflation-adjusted dollars) over the last 15 years. It should be noted that the study’s findings don’t take into account Medicare Advantage (Part C, or MA), the program’s managed care option.
Krumholz believes that these lower costs may be due to measures designed to boost patients’ health. Among these are prevention programs and advances in medical care. In addition, beneficiaries are receiving medical care in less-expensive outpatient clinics, rather than hospitals, which is helping to lower expenses.
Certain factors, such as the recent recession, help to keep Medicare expenses down. And, the federal government is reimbursing hospitals and doctors less for treating Medicare patients, as well. “That’s an easy way to get control of medical spending in Medicare,” says economist Craig Garthwaite at the Kellogg School of Management at Northwestern University. Garthwaite continues, “it’s just not something we can do in the private market, and we have to worry about how sustainable it is for the Medicare program overall.”
Medicare does have  a small deficit and several adjustments may be required in the coming years. But overall, Medicare’s financial picture is improving. According to the program’s trustees, the program’s trust fund is expected to be solvent through 2030.

2017 Medicare Annual Enrollment deadlines

The 2017 Annual Enrollment Period (AEP) for Medicare will run from October 15, 2016, through December 7, 2016. Below are some important dates and deadlines to be aware of:

  • October 15, 2016: Medicare Open Enrollment starts. This is the first day to in a 2016 Medicare plan, whether you’re a current beneficiary or new to the program. During this time, you can sign up for Medicare Advantage (Part C) or Part D, or you can change your coverage.
  • December 7, 2016: 2017 Medicare Open Enrollment ends.
  • January 1, 2017: This is the first day your coverage starts for your new plan; any previous changes take effect
  • January 1 – February 14, 2017: Medicare Advantage Disenrollment Period. Medicare Advantage enrollees can switch back to original Medicare. You can also sign up for Medicare Part D plans in this period if you drop an MA plan and switch to original Medicare without drug coverage.

Initial Enrollment Period (IEP) – If you’re new to Medicare and turning 65, you can actually enroll outside of the Open Enrollment Period in a period called the “Initial Enrollment Period.” In fact, this is the best time to enroll. Your initial eligibility window begins three months before your 65th birthday and ends three months after; it includes your entire 65th birthday month as well. If you enroll within this period, your coverage will start no sooner than your birthday month, but if you miss this window, you’ll have to wait to enroll during the Open Enrollment Period for Medicare Advantage or Part D plans. General enrollment for original Medicare runs from January 1 through March 31 of each year.
There are also special enrollment periods for unique cases such as if you are disabled or have group insurance through an employer. The Medicare website offers an overview of special circumstances.
What if I miss the Open Enrollment Period?
You can only sign up for Medicare, Medicare Advantage or Part D coverage during designated times unless you qualify for a special enrollment period. Failure to enroll during your initial eligibility window may mean a late enrollment penalty, including:

  • Part A — Your monthly premium may go up 10 percent. You’ll pay the higher premium for twice the number of years you could have had Part A, but didn’t sign up.
  • Part B – You’ll likely pay a late enrollment penalty for as long as you have Part B. Your monthly premium may increase by 10 percent for each full 12-month period you could have had Part B, but didn’t sign up.
  • Part D – Your late enrollment penalty, calculated by Medicare, will be:
    • 1 percent of the “national base beneficiary premium” ($34.10 in 2016), multiplied by the number of full, uncovered months without Part D or creditable coverage.
    • You’ll also pay your plan’s monthly Medicare Part D premium, plus 1 percent of the national base Medicare Part D monthly premium for each month without creditable prescription drug coverage
    • In 2017, the national base beneficiary premium increases to $35.63, so fees will go up as well.


Top 4 Ways the ACA Is Helping Seniors

The Affordable Care Act (ACA) has emerged as a  success in providing men, women and children with direct, convenient access to quality healthcare and prescription medications. But we’re fast approaching another momentous occasion, the 50th anniversary of two ground-breaking healthcare programs – Medicare and Medicaid. And while we tout the ACA’s many benefits, it’s important to remember that these two programs provided crucial healthcare for millions of Americans, especially those 65 years or older.
On July 30, 2015, Medicare and Medicaid (for low-income individuals and families) were signed into law. These programs, which were part of the Social Security Amendments of 1965, were the culmination of a 20-year journey. Before then, Americans had no healthcare “safety net” in place. To be insured, anyone 65 years or older had to have employer-provided health insurance or a private plan. Otherwise, they were on their own, or at the mercy of family or friends, for medical care.
Medicare was greeted very enthusiastically, and on July 1, 1966, more than 19 million Americans age 65 and older enrolled. Another milestone occurred in 1972, when Medicare extended eligibility to individuals under age 65 with long-term disabilities or end-stage renal disease.
Are you 65 or older? Have you taken advantage of these ACA benefits?
While Medicare (and Medicaid) long enabled valuable health services, the Affordable Care Act has taken healthcare coverage to a whole new level. First and foremost, the ACA established health-insurance exchanges (or, the Marketplace) enabling the uninsured (of all ages) to purchase qualifying coverage, even those with pre-existing conditions. But this law actually offers America’s senior population several unique benefits, and not all of these are as well-known, if at all!donut hole

  1. Down with the “donut hole” – While Medicare-eligible seniors can purchase Medicare Part D for prescription drug coverage, they may be subject to a coverage gap, known as the “donut hole.” Prior to the ACA, Part D paid most drug costs; beneficiaries then paid only 25 percent of that initial level of costs once they’d paid their deductible. But above that amount, Part D paid nothing, and seniors were responsible for all drug costs. Instead, coverage again kicked in once total out-of-pocket spending went above a higher amount. Then, participants would pay a small amount of the cost for prescription drugs above that amount.


But the ACA established a schedule of discounts for both brand-name and generic drugs within this donut hole. In 2015, Medicare participants receive a 55 percent discount on brand-name drugs and a 35 percent discount on generics, respectively. And while seniors don’t pay the discounted amounts, those discounted amounts are counted against the out-of-pocket maximum to calculate where the donut hole ends. Therefore, seniors will only be responsible for 25 percent of their drug costs by 2020. This should also match basic coverage under the standard Part D model, which will basically make the donut hole disappear.

  1. Annual wellness and preventive care exams for seniors under Medicare – A major selling point of the ACA is that it provides seniors with essential annual wellness and preventive care exams. It’s been found that these exams are effective in reducing or even reversing the need for future illnesses and injuries. Wellness visits are designed to review your medical and family history. They provide a database of routine measurements for patients’ physical condition, along with a list of current healthcare providers and any prescription drugs you take.

As they include personalized health advice, wellness visits can establish lists of risk factors and treatment options for any conditions you have. You’re also able to receive multiple, diverse screenings, including vaccinations, cancer checks and vision tests. While many screenings are free, some may require you to pay Medicare Part B’s normal 20 percent copayment.

  1. Financial assistance for low-income seniors’ costs – Before the ACA’s establishment, low-income seniors relied on Medicare, and especially Medicaid, for any financial assistance available to cover healthcare costs. This was often difficult, but the new law provides e additional financial options for low-income seniors. For instance, the ACA eliminates cost-sharing provisions for prescription drug coverage for those who receive home-based or community-based care. There may also be some long-term care options to help low-income patients receive home-based care.
  1. A more secure level of attention and detail – Under the ACA, special care has been taken to ensure that procedures and prescribed medications are medically necessary and carefully considered. By involving a second pair of eyes (or more), doctors, and the Medicare program, in general, can reduce the chances of making costly (and potentially dangerous) mistakes. This provides senior patients with added security and confidence that they’re receiving the proper medical care. It saves patients – and the entire healthcare system – from unnecessary costs, as well.

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[Infographic] Shocking! Here's The Most Expensive Medicare Drugs In The U.S.

most expensive drugs in the us

2016 Medicare Rates

The Centers for Medicare & Medicaid Services (CMS), the federal agency overseeing Medicare, recently released its 2016 payment and policy updates. It’s a great idea to get educated about what kind of costs you’ll face with your Medicare plan next year if will be joining the program, are presently enrolled in an Original Medicare and are thinking about switching to a Medicare Advantage plan or if you’re already enrolled in a Medicare Advantage plan.
These 2016 figures are applicable for Medicare Advantage (also called Medicare Part C or MA Plans), which are private health plans providing managed care options. And, these 2016 figures apply to Medicare Part D, the prescription drug coverage plan.
Medicare Advantage, Part D Trends
Since the Affordable Care Act (ACA) was established in 2010, CMS has ensured that for both Medicare Advantage and Part D, enrollment rates and quality will continue to grow and improve. The agency’s 2016 updates account for the full range of comments received during the public comment period. These sessions allow interested parties to submit general comments concerning Medicare’s national coverage. And if next year’s updates are any indication, 2016’s Medicare trends should be similar to recent years, including:

  • The MA and Part D programs have both continued their growth, the quality of participating plans has continued to increase and premiums have remained stable.
  • MA plan enrollment has increased by 42 percent since the ACA’s passage. There are more than 16 million beneficiaries (an all-time high); nearly 30 percent of all Medicare beneficiaries are enrolled in MA plans.
  • MA plan quality continues to improve. In 2015, 60 percent of MA enrollees will be enrolled in a 4 or 5 star plan, compared to 2009’s estimated 17 percent.
  • Premiums remain affordable. Today, average premiums are lower than before the ACA’s passage, dropping 6 percent between 2010 and 2015.

Medicare Advantage beneficiaries, in particular, should benefit from the 2016 updates. “These policies strengthen Medicare Advantage for current and future consumers by encouraging higher quality care,” states Andy Slavitt, acting CMS Administrator. “As the Medicare Advantage marketplace continues to grow, consumers are getting access to better care through more choice and competition. Seniors and people with disabilities, including the dual-eligible population, will continue to have an extensive choice of plans, affordable premiums, and better and more transparent information about provider networks and pharmacies.”
2016 Rates for Medicare Advantage
According to the CMS, Medicare Advantage plan payments will rise about 1.25 percent in 2016. However, the agency said insurers should probably expect their overall revenue to increase by about 3.25 percent, as they deliver and bill for more intensive services. 2015 federal payments for MA plans – not including Part D plans – should total about $155 billion.
You can research specific Part C plan costs on the Medicare website. You can also find a wealth of information relating to both MA and Part D plans in the CMS’s publication, MA Payment Guide for Out of Network Payments.
The monthly premiums, deductibles, copayments and coinsurance prices for MA plans vary. Medicare pays the MA plans a monthly, fixed amount for each beneficiary. The MA plans then charge a monthly premium. Another premium may be necessary for Medicare Part B (medical insurance) coverage, if purchased. Doctors may recommend services more often than what Medicare covers — or not at all. If so, beneficiaries may be liable for some or all costs; be sure to ask what’s covered by Medicare.
2016 CMS Part D Rates
Although much of Medicare Part D has remained stable over the past few years, there are several important changes for 2016. The “CMS Defined Standard Benefit Plan” chart provides a side-by-side look at the changes that have occurred between 2012 and 2016. “Standard Benefit” is defined as the minimum allowable plan payment available to beneficiaries. Here are some important highlights for this first chart, showing payment increases and other differences between 2015 and 2016:

  • Initial deductible – For 2016, this will increase by $40 to $360
  • Initial coverage limit –In 2015, this was $2,960; in 2016, it increases to $3,310
  • Out-of-pocket threshold —In 2015, this was $4,700; in 2016, it increases to $4,850
  • Coverage gap – Also known as the “donut hole,” this is the temporary coverage gap common in most Medicare Part D prescription drug plans. It starts once your Part D plan’s initial coverage limit ($3,310 in 2016) is met. It ends when you spend a total of $4,850 in 2016.
  • Brand-name drugs — In 2016, Part D enrollees will receive a 55 percent discount on the total cost of their brand-namedrugs purchased while in the donut hole. Brand-name drug manufacturers will pay a 50 percent discount that is applied to getting out of the donut hole. However, while your Part d plan pays an additional 5 percent, this doesn’t count toward your True Out-of-Pocket (TrOOP) costs. TrOOP costs are expenses affecting your Medicare drug plan out-of-pocket expenses.
  • Generic drugs – Part D enrollees will pay a maximum of 58 percent on their copay on genericdrugs purchased while in the donut hole; (a 42 percent discount).
  • Minimum cost-sharing in the catastrophic coverage portion of the benefit** — This cost will increase to the greater of 5 percent or $2.95 for generic or preferred drugs. These must be multi-source drugs, which are those available in both brand-name and generic varieties. For all other drugs, this cost will increase to the greater of 5 percent or $7.40 in 2016.
  • Maximum co-pays below the out-of-pocket threshold for certain low-income, full subsidy eligible enrollees – These costs will increase to $2.95 for generic or preferred drugs considered multi-source drugs. For all other drugs, this increases to $7.40 in 2016.

View 2015 rate comparison details here (PDF download).
Below, you’ll find the “2015 Federal Poverty Level Guidelines: LIS Qualification.” Medicare Part D offers a Low Income Subsidy (LIS) program, known as the “Extra Help program.” The Federal Poverty Level (FPL) guidelines are used to determine potential Part D enrollees’ income level requirements. This LIS subsidy can be used to pay both your monthly plan premiums and drug costs.2015 Federal Poverty Level Guidelines: LIS Qualification
For the remainder of 2015, those people with income levels below 135 percent of the FPL may qualify for the full Low Income Subsidy. However, resource limits do apply; the chart above provides these. Specifically, the FPL is: $15,889.50 for single people; $21,505.50 for married couples. And if you don’t qualify for full LIS benefits, you may still qualify for partial benefits. Your income level must be at or below 150 percent of the FPL. Again, the chart above provides the resource limits.

Medicare Enrollment News

Recent articles & links about Medicare

Medicare Guide: Comparing plans in 2020

The Basics of Medicare

Medicare is a government-run health insurance program for those aged 65 and older and people under 65 with certain disabilities and End-Stage Renal Disease. Today, over 10,000 people turn 65 every day and are eligible for Medicare and Medicare is a way to help them pay for their medical expenses. There are 4 major parts to Medicare to choose from which provide you with a variety of coverage options for hospital visits, prescriptions and more. These include:
Parts A and B
These combined parts are known as Original Medicare. Part A (also known as hospital insurance) helps with paying hospital bills. Part B (medical insurance)  helps pay for a variety of medical services, including doctor visits, preventative services , and durable medical equipment (DME), among others.

  • Most people with Part B pay $109 a month, but new enrollees for 2019 will pay the standard premium amount of $135.50.
  • The annual deductible for Part B is $185.
  • The Part A inpatient deductible is $1,364 for every benefit period. You’re also responsible for co-insurance fees when you’re in the hospital depending on your length of stay.
  • Medicare provides your coverage.
  • You pick your doctors, hospitals and other medical providers if accepted by Medicare.
  • You’re responsible for deductibles and other out-of-pocket costs, unless they’re covered by Medicare Supplemental Insurance.

Part C

Part C of Medicare is known as Medicare Advantage (or MA). These are plans that are approved by Medicare but offered by private insurance companies. Part C plans are another option if you don’t want the traditional Medicare plan. Part C plans cover hospital and doctor visits, but they can also cover prescription drugs, dental care, hearing care, and vision care, among others.

  • Part C uses different plan types, such as health maintenance organizations (HMOs) and preferred provider organizations (PPOs).
  • Private insurance companies that are approved by Medicare provide coverage.
  • The plan specifies doctors, hospitals and providers.
  • You may pay more or all of the costs if you pick your own doctors and medical providers.
  • You pay a monthly premium.
  • You might pay a copayment or coinsurance for covered services.
  • Premiums and cost vary depending on the insurance company.

Part D

Part D of Medicare comprises private plans that help with the costs of prescription drugs for those who have traditional Medicare (Parts A and B).

  • Monthly premiums vary based on the plan. Those with higher incomes may pay more.
  • If you made $85,000 or less as an individual or $170,000 or less on a joint tax return, you only pay your plan premium.
Speak to a Licensed Insurance Agent (800) 485-6202 TTY 711

Other Options

Medicare Medical Savings Account (MSA): Medicare also partners with private insurance companies to provide other ways to get medical coverage. These companies may offer Medicare MSA plans, which are types of Medicare Advantage plans. These plans give you more flexibility to pick your providers, doctors and services.

  • High-deductible savings plans can be included in Medicare Advantage plans. You must meet a high yearly deductible in order to cover your medical costs.
  • The MSA is a special savings account in which Medicare deposits money into an account. You can choose to use money from this savings account to pay for medical care before you meet the deductible.

Use a Group Health Plan instead of Medicare: If you are 65 or older and covered by a group health plan through an employer, spouse, private plan or union, then you can elect to avoid Medicare. However, you may still want to take advantage of some services covered by Medicare, such as drug coverage.

Things to know about Medicare plans

The first thing to note is that Original Medicare (Part A and Part B) does not cover all medical costs. Dental and vision care is not covered by Original Medicare. You must seek alternative insurance to cover these types of medical services, or you may qualify for low-income assistance. But you still pay a premium, copay and deductible for these medical services.
You should enroll in Medicare when you first become eligible due to age unless you still have health insurance through your group plan because there may be consequences for waiting such as higher premiums or underwriting requirements.

How to Enroll in Medicare

If you are interested in learning about and enrolling in a Medicare Part C plan (also called Medicare Advantage), a Medicare Part D plan or a Medigap plan (also called a Medicare Supplement plan) then you may do so by shopping online on your own, which you may start to do here, or you may call (800) 485-6202 to speak to a licensed agent.

If you need to enroll in Original Medicare (Part A and Part B), you must do so through your Social Security Office and may visit for more information.

There are other health plans, such as Medicare Medical Savings Account (MSA) Plans, Programs of All-Inclusive Care for the Elderly (PACE), Medication Therapy Management (MTM), Demonstrations and Pilot programs and Medicare Cost Plans, to consider that may have benefits that Original Medicare doesn’t offer.

Have Medicare Questions? Call (800) 485-6202 TTY 711

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