Medicare Supplement plans plug the Medicare holes so you do not have the out of pocket costs Original Medicare will leave you with. So let us talk about some of the common terms you need to be aware of with Medicare and a Medicare Supplement plan:
- California Open Enrollment – (Unique to California) the ability of a Medicare Supplement member to switch to another company each year on the month of their birthday. This is a guaranteed issue option. You can not be denied the transfer because of health status.
- Original Medicare – Run by the Federal government and provides both Part A and Part B coverage.
- Medicare Part A – is the hospital coverage Medicare pays for. You are responsible for the $ 1,100 deductible each benefit period (60 days) you enter a hospital.
- Medicare Part B – the out patient Medicare coverage for physician, specialist and surgery services. There is a $ 155 Part B annual deductible you will need to pay the beginning of each calender year when you see a physician.
- Part B premium – All Medicare beneficaries are required to pay for their Part B premium. In 2010 the monthly premium is $ 96.40. If your annual income is higher than $ 85,000 your premium increases to $ 110.50. (other rules apply).
- Assignment – an arrangement wherey a physician or hospital agreements to accept the Medicare-approved amount as full payment for services and supplies covered under Part B. Medicare usually pays 80% of the approved amount directly to the physician after the beneficial satisfies the Part B deductible of $ 155.00. The Medicare Supplement member pays the other 20%.
- Skilled Nursing Facility – (Medicare Part A) A medical care facility used primarily for rehabilitation. Patients are typically in a Skilled Nursing Facility when they are recuperating from an accident, illness or surgical procedure. Medicare typically pays all costs except $ 137.50 per day. Medicare will not continue to pay for this service is the person has a degenerative condition. In other words, the patients condition should be improving, if not, the coverage is stopped and a long term care policy or medicaid is necessary to continue to pay for these services.
- Medicare Part D – Medicare Prescription Drug Coverage. Helps cover the cost of prescription drugs. Must be purchased from a private insurance company.
- Part B Coinsurance – After the Part B deductible, Medicare requires you to pay 20% of all Medicare eligible expenses for physician, specialist, ambulance and hospital outpatient services and supplies.
- Excess Charges – When your medical bill for Part B services exceeds the Medicare eligible expense. For example; if the Medicare allowable charge for a certain visit or procedure is $ 100. Medicare Part B pays $ 80 and the Medicare Supplement pays the remaining $ 20, if the Medicare Supplement pays for Excess Charges. Some plans do not cover this extra charge.
- Initial Enrollment Period – (IEP) Your enrollment is guaranteed if you apply for coverage before or within six months of enrolling in Medicare Part B.
The terms above are some of the most common terms relating to a Medicare Supplement plan and you should become familiar with these terms when purchasing a plan. Please contact a Medicare specialist for more information.