Aug 05, 2013 |
By Joseph F. Stenken
Medicare is a federal health insurance
program for persons 65 or older, persons of any age with permanent kidney
failure, and certain disabled persons.
Medicare is
administered by the Centers for Medicare & Medicaid Services (CMS), a
federal agency in the Department of Health and Human Services. Social Security
Administration offices across the country take applications for Medicare,
collect premiums, and provide general information about the program. Various
commercial insurance companies are under contract with CMS to process and pay
Medicare claims, and groups of doctors and other health care professionals have
contracts to monitor the quality of care delivered to Medicare beneficiaries.
CMS also forms partnerships with the thousands of providers of health care
services: hospitals, nursing homes, and home health agencies; doctors;
suppliers of medical equipment; clinical laboratories; and managed care plans
such as health maintenance organizations (HMOs).
Medicare
consists of Hospital Insurance (Part A), Medical Insurance (Part B), Medicare
Advantage (Part C) (formerly known as Medicare+Choice), and Prescription Drug
Insurance (Part D).
Hospital
Insurance (Part A) provides institutional care, including inpatient hospital
care, skilled nursing home care, post-hospital home health care, and, under
certain circumstances, hospice care. Part A is financed for the most part by Social Security payroll tax deductions which
are deposited in the Federal Hospital Insurance Trust Fund. Medicare
beneficiaries also participate in the financing of Part A by paying
deductibles, coinsurance and premiums.
Medical
Insurance (Part B) is a voluntary program of health insurance which covers
physician’s services, outpatient hospital care, physical therapy, ambulance
trips, medical equipment, prosthesis, and a number of other services not
covered under Part A. It is financed through monthly premiums paid by those who
enroll and contributions from the federal government, both of which are
deposited into the Federal Supplementary Medical Insurance Trust Fund. The
government’s share of the cost of Medicare Part B is approximately 75%.
Medicare
Advantage (Part C) permits contracts between CMS and a variety of different
managed care and fee-for-service organizations. Most Medicare beneficiaries can
choose to receive benefits through the original Medicare fee-for-service
program or through one of the following Medicare Advantage plans:
- Coordinated care plans, including
Health Maintenance Organizations (HMOs), Preferred Provider Organizations
(PPOs), and Provider Sponsored Organizations (PSOs). A PSO is defined as a
public or private organization, established by health care providers, that
provides a substantial proportion of health care items and services
directly through affiliated providers who share, directly or indirectly,
substantial financial risk.
- Religious fraternal benefit
society plans that may restrict enrollment to members of the church,
convention or group with which the society is affiliated. Payments to
these plans may be adjusted, as appropriate, to take into account the
actuarial characteristics and experience of plan enrollees.
- Private fee-for-service plans that
reimburse providers on a fee-for-service basis, and are authorized to
charge enrolled beneficiaries up to 115% of the plan’s payment schedule
(which may be different from the Medicare fee schedule).
The Department
of Health and Human Services contracts with private insurance companies for the
processing of payments to patients and health care providers. These private
insurance companies are called fiscal intermediaries under Part A and are
selected by the health care providers. Under Part B, these private insurance
companies are called carriers and are selected by the Department of Health and
Human Services.
Medicare
Prescription Drug Insurance (Part D) was added to Medicare by the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003. In exchange for
a monthly premium, Medicare Part D participants receive limited coverage for
prescription drug benefits up to a catastrophic coverage threshold, above which
Part D will cover roughly 95% of prescription drug costs.
1. In general, what is the Hospital Insurance (Part A) protection provided
by Medicare?
Persons
protected have benefits paid for certain hospital and related health care
services when they incur expenses for such services.
A person
entitled to Social Security monthly benefits or a
qualified railroad retirement beneficiary is automatically entitled to Hospital
Insurance protection beginning with the first day of the month of attainment of
age 65. An individual who is insured for monthly benefits need not actually
file to receive the benefits. Under limited circumstances, services furnished
in Canada or Mexico, or in some cases in the Caribbean, or aboard ship in
United States territorial waters, may be paid by Medicare, but otherwise, services
furnished outside the United States are not paid for by Hospital Insurance.
Medicare is the
secondary payer if a person is covered by an employer group health insurance plan, is
entitled to veterans benefits, workers’ compensation, or black lung benefits.
Medicare is also the secondary payer if no-fault insurance or liability
insurance (such as automobile insurance) is available as the primary payer.
Although Medicare is sometimes the secondary payer when liability insurance is
available, Medicare may make a conditional payment if it receives a claim for
services covered by liability insurance. In these cases, Medicare recovers its
conditional payment from the settlement amount when the liability settlement is
reached.
Medicare is the
secondary payer during a period (generally 30 months) for individuals who have
Medicare solely on the basis of their end-stage renal disease, if they have
employer group health plan coverage themselves or through a family member.
2. In general, what is the Medical Insurance (Part B) protection provided
by Medicare?
Persons
protected have benefits paid for certain physicians’ services (including
surgery), home health services (other than post-hospital home health services),
clinical laboratory services, durable medical equipment, and some other items
and services not covered by Hospital Insurance (Part A) protection.
Medical
Insurance (Part B) protection is financed through monthly premiums paid by each
person who enrolls (or by the state where the person is enrolled under a
federal-state agreement) and through contributions appropriated from federal
general revenues. The premium for Part B varies according to a person’s income.
The standard monthly premium for Part B coverage beginning January 1, 2013 is
$104.90. Those with higher incomes may pay as much as $335.70 in 2013.
3. Who can provide services or supplies under Medicare?
Health care
organizations and professionals providing services to Medicare beneficiaries
must meet all licensing requirements of state or local health authorities. The
organizations and persons listed below also must meet additional Medicare
certification requirements before payments can be made for their services:
- Hospitals
- Skilled nursing facilities
- Home health agencies
- Hospice programs
- Independent diagnostic
laboratories and organizations providing X-ray services
- Organizations providing outpatient
physical therapy and speech pathology services
- Facilities providing outpatient rehabilitation
facilities
- Ambulance firms
- Chiropractors
- Independent physical therapists
(those who furnish services in the patient’s home or in their offices)
- Facilities providing kidney
dialysis or transplant services
- Rural health clinics
All hospitals,
skilled nursing facilities, and home health agencies participating in the
Medicare program must comply with Title VI of the Civil Rights Act, which
prohibits discrimination because of race, color, creed, or national origin.
Medicare does
not pay for care received from a hospital, skilled nursing facility, home
health agency, or hospice that is not certified to participate in the program.
These providers are referred to as non-participating. But Hospital Insurance
can help pay for care in a qualified non-participating hospital if (1) the
patient is admitted to the non-participating hospital for emergency treatment,
and (2) the nonparticipating hospital is the closest one that is equipped to
handle the emergency. Under Medicare, emergency treatment means treatment that
is immediately necessary to prevent death or serious impairment to health.
If the
nonparticipating hospital elects to submit the claim for Medicare payment,
Medicare will pay the hospital directly except for any deductible or
coinsurance amounts. If the hospital does not submit the claim, the patient may
submit the claim and receive payment. In this case, the patient would reimburse
the hospital.
4. In general, what benefits are provided under the Hospital Insurance
(Part A) program?
The program, which
is compulsory, provides the following benefits for persons age 65 or older and
persons receiving Social Security disability benefits for 24 months or more:
- The cost of inpatient hospital
care for up to 90 days in each benefit period (for 2013, the patient pays
a deductible amount of $1,184 for the first 60 days plus $296 a day for
each day in excess of 60). There are also 60 non-renewable lifetime
reserve days with coinsurance of $592 a day in 2013.
- The cost of post-hospital skilled
nursing facility care for up to 100 days in each benefit period (the
patient pays $148.00 a day in 2013 after the first 20 days).
- The cost of 100 post-hospital or
post-skilled nursing facility home health service visits in a spell of
illness made under a plan of treatment established by a physician, except
that there is 20% cost-sharing payable by the patient for durable medical
equipment (other than the purchase of certain used items). Additional
coverage for home health care services which do not meet the Part A
coverage criteria and visit limitations may be available under Medical
Insurance (Part B). (See Q 1008.)
- The cost of hospice care for terminally ill
patients.
5. In general, what benefits are payable under Medical Insurance (Part B)?
Medical Insurance (Part B) is offered to
almost all persons age 65 or over on a voluntary basis. In addition, the
program is offered to all disabled Social Security and Railroad Retirement
beneficiaries who have received disability benefits for at least 24 months. For
2013, there is an annual deductible of $147, paid by the patient. This annual
deductible is adjusted to reflect the amount of Medicare Part B costs.
Medical Insurance pays 80% of the approved charges above the deductible for the
following services:
- Physicians’ and surgeons’
services, whether furnished in a hospital, clinic, office, home, or
elsewhere, excluding routine or yearly physical exams.
- A one-time initial wellness
physical within 6 months of enrolling in Medical Insurance (Part B).
- Screening blood tests for early
detection of cardiovascular disease.
- Diabetes screening tests for
those at risk of getting diabetes.
- Home health care visits, if not
covered under Hospital Insurance (Part A) (but with no cost-sharing
except for durable medical equipment, other than the purchase of certain
used items). In the past, few home health care visits were covered under
Medical Insurance (Part B) but this has changed because of the creation
of separate Hospital Insurance and Medical Insurance home health benefits
in 1998.
- Outpatient hospital services for
the diagnosis or treatment of an illness or injury.
- Diagnostic x-ray tests (including
certain portable X-ray services in the home), diagnostic laboratory tests,
and other diagnostic tests (no cost-sharing).
- Outpatient physical therapy and
outpatient speech-language pathology services furnished by participating
hospitals, skilled nursing facilities, home health agencies, outpatient
therapy clinics, or by others under arrangements with, and under the
supervision of, such organizations.
- Outpatient physical therapy
services and outpatient speech-language pathology services provided in a
hospital or skilled nursing facility to its inpatients who have exhausted
their inpatient days, or are otherwise not entitled to Hospital Insurance
benefits.
- Outpatient physical therapy
services and occupational therapy services furnished by a licensed,
independently practicing physical therapist or occupational therapist in
his or her office or the patient’s home, provided the patient is under the
care of a physician.
- Rural health clinic services and
federally qualified health center services.
- Prosthetic devices (other than
dental) which replace all or part of a covered body part, including
replacement of such devices.
- Home dialysis supplies and
equipment, self-care home dialysis support services, and institutional
dialysis and supplies.
- Chiropractor’s treatment by manual
manipulation of the spine to correct a subluxation of the spine. But the
cost of the chiropractor’s X-ray, if any, is excluded.
- Podiatrist’s services (excluding
the treatment of flat foot conditions, subluxations of the foot, and
routine foot care that does not require treatment by a podiatrist or
physician).
- Leg, arm, back, and neck braces,
and artificial legs, arms, and eyes, including replacements where
necessary because of a change in the patient’s condition.
- Rental or purchase of durable
medical equipment.
- X-ray, radium, and radioactive
isotope therapy, including materials and services of technicians.
- Surgical dressings, and splints,
casts, and other devices for reduction of fractures and dislocations.
- Ambulance services, under certain
circumstances.
- Blood clotting factors for
hemophilia patients and items related to its administration.
- Hospital services incident to a
physician’s services to an outpatient (including drugs and biologicals
which cannot be self-administered).
- Antigens prepared by a physician
for a particular patient.
- Annual flu shot (no cost-sharing).
- Pneumococcal vaccine and its
administration (no cost-sharing).
- Hepatitis B vaccine and its
administration (if beneficiary considered at high or intermediate risk of
contracting disease).
- Certified nurse-midwife services.
- Partial hospitalization services
provided by a community mental health center or hospital outpatient
department.
- Screening pap smear and pelvic
exams.
- Prostate cancer screening tests.
- Annual screening mammography for
all women age 40 and over (the Part B deductible is waived).
- Colorectal cancer screening.
- Diabetes monitoring and
self-management benefits.
- Bone mass measurements.
- The cost of an injectable drug for
the treatment of a bone fracture related to post-menopausal osteoporosis.
- Eyeglasses following cataract
surgery.
- Services of nurse practitioners
and clinical nurse specialists in rural areas for the services they are
authorized to perform under state law and regulations.
- Oral cancer drugs if they are the
same chemical entity as those administered intravenously and currently
covered. Off-label cancer drugs are covered in some cases.
- Necessary medical supplies.
- Immunosuppressive drug therapy.
- Lung and heart-lung, liver and
kidney transplants under certain circumstances.
The cost of
psychiatric treatment outside a hospital for mental, psychoneurotic, and personality disorders
is covered. But coinsurance is usually 50% instead of 20%.
6. Is there any overall limit to the benefits a person can receive under Medicare?
Under Hospital
Insurance (Part A), benefits begin anew in each benefit period. In addition,
there are no dollar limits under Medical Insurance (Part B) except for
psychiatric care and independent physical and occupational therapy. Under
Hospital Insurance, care in a psychiatric hospital is subject to a lifetime
limit of 190 days. (The time a patient has spent in a hospital for psychiatric
care immediately prior to becoming eligible for Medicare counts against the
special 150-day limit in the first hospitalization period, but not against the
190-day lifetime limit.)
Separate
calendar year caps on coverage of independent occupational therapy and physical
and speech therapy services returned January 1, 2006. The annual limitation was
initially enacted for 1999, but Congress granted and then extended a moratorium
on implementation through the end of 2002. Implementation was further delayed
by administration decision until September 1, 2003. The limitation was then
eliminated effective December 7, 2003. The Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 eliminated the annual limit through
the end of 2005. In the Deficit Reduction Act of 2005, Congress added a
provision for the Secretary of Health and Human Services to make an exception
to the annual limit if the provision of additional services is "medically
necessary." The exceptions process allows for specific diagnoses and
procedures to receive Medicare coverage even after a beneficiary has met his or
her therapy cap for the year. Alternatively, a provider can request an
exception if the particular problem to be treated is not automatically covered
under the given exceptions. This exceptions process was scheduled to end June
30, 2008, but was extended through December 31, 2009.
Medicare may
limit benefit payments for services for which other third-party insurance
programs (e.g., workers’ compensation, automobile or liability insurance, and
employer health plans) may ultimately be liable. The Spending Reduction Act of
1984 establishes the statutory right of Medicare to (1) bring an action against
any entity that would be primarily responsible for payment with respect to the
item or service, (2) bring an action against any entity (including any
physician or provider) that has been paid with respect to the item or service,
and (3) join or intervene in an action against a third party.
7. What care is not covered under Medicare?
Medicare does
not cover custodial care when that is the only kind of
care the patient needs.
Care is
considered custodial when it is primarily for the purpose of helping with daily
living or meeting personal needs and could be provided safely and reasonably by
persons without professional skills or training. Much of the care provided in
nursing homes to people with chronic, long-term illnesses or disabilities is
considered custodial care. For example, custodial care includes help in
walking, getting in and out of bed, bathing, dressing, eating, and taking
medicine. Even if an individual is in a participating hospital or skilled
nursing facility or the individual is receiving care from a participating home
health agency, Medicare does not cover the stay if the patient needs only custodial
care.
Medicare does
not pay for services that are not reasonable and necessary for the diagnosis or
treatment of an illness or injury. These services include drugs or devices that
have not been approved by the Food and Drug Administration (FDA); medical
procedures and services performed using drugs or devices not approved by FDA;
and services, including drugs or devices, not considered safe and effective
because they are experimental or investigational. In addition, Medicare does
not pay for most outpatient prescription drugs (except under Medicare Part D),
routine or annual physical exams, most dental care and dentures, routine foot care,
routine eye care, hearing aids and cosmetic surgery.
If a doctor
places an individual in a hospital or skilled nursing facility when the kind of
care the individual needs could be provided elsewhere, the individual’s stay
will not be considered reasonable and necessary, and Medicare will not pay for
it. If an individual stays in a hospital or skilled nursing facility longer
than necessary, Medicare payments will end when inpatient care is no longer
reasonable or necessary.
If a doctor (or
other practitioner) comes to treat a person or that person visits the doctor
for treatment more often than is medically necessary, Medicare will not pay for
the “extra” visits.
Medicare will
not pay for services performed by immediate relatives or members of a patient’s
household. Medicare also will not pay for services paid for by another
government program.
Doctors cannot
make self-referrals for certain designated health services. Designated health
services include (1) clinical laboratory services, (2) physical therapy
services, (3) occupational therapy services, (4) radiology services, including
MRI, CAT scans, and ultrasound services, (5) radiation therapy services and
supplies, (6) durable medical equipment and supplies, (7) parenteral and
enteral nutrients, equipment, and supplies, (8) prosthetics, orthotics, and
prosthetic devices and supplies, (9) home health services, (10) outpatient
prescription drugs, and (11) inpatient and outpatient hospital services.
The law
prohibits a doctor who has a financial relationship with an entity from
referring Medicare patients to that entity to receive a designated health
service. The prohibition also applies if a doctor’s immediate family member has
a financial relationship with the entity. A financial relationship can exist as
an ownership or investment interest in or a compensation arrangement
with an entity. The law is triggered by the mere fact that a financial
relationship exists; it does not matter what the doctor intends when making a
referral.
An entity
cannot bill Medicare, Medicaid, the beneficiary, or anyone else for a
designated health service furnished to a Medicare patient under a prohibited
referral. If a person collects any amount for services billed in violation of
the law, a refund must be made. A person can be subject to a civil money
penalty or exclusion from Medicare if that person (1) presents or causes to be
presented a claim to Medicare or bill to any individual, third-party payer, or
other entity for any designated health service the person knows or should know
was furnished as the result of a prohibited referral, or (2) fails to make a
timely refund.
Under Medicare
law a person will not be held responsible for payment of the cost of certain
health care services for which the person was denied Medicare payment if the person
did not know or could not reasonably be expected to know that the services were
not covered by Medicare. This provision is often referred to as a “Waiver of
Liability.” The waiver provision applies only when the care was denied because
it was one of the following: (1) custodial care, (2) not reasonable or
necessary under Medicare program standards for diagnosis or treatment, (3) for
home health services, the patient was not homebound or not receiving skilled
nursing care on an intermittent basis, or (4) the only reason for the denial is
that, in error, the patient was placed in a skilled nursing facility bed that
was not approved by Medicare.
Also, the
limitation of liability provision does not apply to Medical Insurance services
provided by a nonparticipating physician or supplier who did not accept
assignment of the claim. However, in certain situations Medicare will protect
the patient from paying for services provided by a nonparticipating physician
on a non-assigned basis that are denied as “not reasonable and necessary.” If a
physician knows or should know that Medicare will not pay for a particular
service as “not reasonable and necessary,” the physician must give the patient
written notice — before performing the service — of the reasons why he believes
Medicare will not pay. The physician must get the patient’s written agreement
to pay for the services. If the patient does not receive this notice, he is not
required to pay for the service. If the patient pays for the service, but did
not receive a notice, he may be entitled to a refund.
8. What are quality improvement organizations?
Quality
Improvement Organizations (QIOs) are groups of practicing doctors and other
health care professionals who are paid by the federal government to review the care given to Medicare patients.
Each state has a QIO that decides, for Medicare payment purposes, whether care
is reasonable, necessary, and provided in the most appropriate setting. QIOs
also decide whether care meets the standards of quality generally accepted by
the medical profession. QIOs have the authority to deny payments if care is not
medically necessary or not delivered in the most appropriate setting.
QIOs
investigate individual patient complaints about the quality of care and respond
to (1) requests for review of notices of noncoverage issued by hospitals to
beneficiaries, and (2) requests for reconsideration of QIO decisions by
beneficiaries, physicians, and hospitals.
The QIO will
tell the patient in writing if the service received was not covered by
Medicare.
If a patient is
admitted to a Medicare-participating hospital, the patient will receive An
Important Message From Medicare, which explains the patient’s rights as a
hospital patient and provides the name, address and phone number of the QIO in
the patient’s state.
If a patient
believes he has been improperly refused admission to a hospital, forced to
leave a hospital too soon, or denied coverage of a medical procedure or
treatment, the patient should ask for a written explanation of the decision.
This written notice must fully explain how the patient can appeal the decision,
and it must give the patient the name, address and phone number of the QIO
where an appeal or request for review can be submitted.
If a patient
disagrees with the decision of a QIO, the patient can appeal by requesting a
reconsideration. Then, if the patient disagrees with the QIO’s reconsideration
decision and the amount in question is $200 or more, the patient can request a
hearing by an Administrative Law Judge. Cases involving $2,000 or more can eventually
be appealed to a federal court.
Appeals of
decisions on all other services covered under Hospital Insurance (skilled
nursing facility care, home health care, hospice services, and some inpatient
hospital matters not handled by QIOs) are handled by Medicare intermediaries.
9. Should a person receive Medicare benefits through the fee-for-service
system or through a Medicare Advantage managed care plan?
A person living
in an area serviced by a managed care plan has a choice between the
fee-for-service system and a managed care plan. If a person chooses
fee-for-service, he can go to almost any doctor, hospital or other health care
provider he wants to. Generally, a fee is charged each time a service is used.
Medicare pays its share of the bill. The patient is responsible for paying the
balance and may obtain a Medicare Supplemental Insurance (Medigap) policy to
cover or help defray the patient’s share of these charges.
In managed
care, a person usually must receive all of his care from the doctors, hospitals,
and other health care providers that are part of the plan, except in
emergencies. Depending on the plan, the patient may pay a monthly premium and a
copayment each time he goes to the doctor or uses other services. The premiums
and copayments vary from plan to plan and may change each year.
Regardless of
whether a person chooses fee-for-service or managed care, he retains all of his
Medicare benefits, protections and appeal rights.
10. Who is eligible for benefits under Hospital Insurance (Part A)?
All persons age 65 and over who are entitled to
monthly Social Security cash benefits (or would be entitled except that an
application for cash benefits has not been filed), or monthly cash benefits
under Railroad Retirement programs (whether retired or not), are eligible for
benefits.
Persons age 65
and over can receive Medicare benefits even if they continue to work.
Enrollment in the program while working will not affect the amount of future
Social Security benefits.
A dependent or
survivor of a person entitled to Hospital Insurance benefits, or a dependent of
a person under age 65 who is entitled to retirement or disability benefits, is
also eligible for Hospital Insurance (Part A) benefits if the dependent or
survivor is at least 65 years old. For example, a woman age 65 or over who is
entitled to a spouse’s or widow’s Social Security benefit is eligible for
benefits under Hospital Insurance.
A Social
Security disability beneficiary is covered under Medicare after entitlement to
disability benefits for 24 months or more. Those covered include disabled
workers at any age, disabled widows and widowers age 50 or over, beneficiaries
age 18 or older who receive benefits because of disability beginning before age
22, and disabled qualified railroad retirement annuitants. Medicare coverage is
automatic. No application is required.
A person who
becomes re-entitled to disability benefits within five years after the end of a
previous period of entitlement (within seven years in the case of disabled
widows or widowers and disabled children) is automatically eligible for
Medicare coverage without the need to wait another 24 months. However, and
further, if the previous period of disability ends on or after March 1, 1988,
he is covered under Medicare without again needing to meet the 24-month waiting
period requirement, regardless of not meeting the five-year (or seven-year)
requirement, if the current impairment is the same as (or directly related to) that
in the previous period of disability.
Coverage will
continue for 24 months after an individual is no longer entitled to receive
disability payments because he has returned to work, provided he was considered
disabled on or after December 10, 1980, and the disabling condition continues.
11. Who is eligible for Medical Insurance benefits? (Part B)
All persons
entitled to premium-free Hospital Insurance (Part A), or premium Hospital
Insurance (Part A) for the working disabled under Medicare, may enroll in
Medical Insurance (Part B). Social Security and Railroad Retirement
beneficiaries, age 65 or over, are, therefore, automatically eligible. But any
other person age 65 or over may enroll provided that she is a resident of the
United States and is either (1) a citizen of the United States or (2) an alien
lawfully admitted for permanent residence who has resided in the United States
continuously during the five years immediately prior to the month in which she
applies for enrollment.
Disabled
beneficiaries (workers under age 65, widows aged 50-64, and children aged 18 or
over and disabled before age 22) who have been on the benefit roll as a
disability beneficiary for at least two years are covered in the same manner as
persons age 65 or over. (This includes disabled Railroad Retirement
beneficiaries.) Disability cases are also covered for 48 months after cash
benefits cease for a worker who is engaging in substantial gainful employment
but has not medically recovered. (Disability benefits are, under such
circumstances, paid for the first nine months of the trial-work period and then
for an additional three months.) After 48 months, and during continued
disability, voluntary coverage is available in the same manner as for
non-insured persons age 65 or over.
A person can
continue to buy Medicare (Hospital Insurance (Part A) only or both Hospital
Insurance and Medical Insurance (Part B)) as long as he remains disabled. Such
a person may enroll during his initial enrollment period which begins with the
month the person is notified he is no longer eligible for premium-free Hospital
Insurance and continues for seven full months after that month. If a person
does not enroll during this initial enrollment period, the person may enroll in
a subsequent general enrollment period (January through March of each year) or
during a special enrollment period.
Also covered
are persons with end-stage renal disease who require dialysis or a kidney
transplant and are eligible for Hospital Insurance (Part A).
12. How does a person enroll in Medical Insurance?
Those who are
receiving Social Security and Railroad Retirement benefits will be enrolled
automatically at the time they become entitled to Hospital Insurance unless
they elect not to be covered for Medical Insurance by signing a form which will
be sent to them. Others may enroll at their nearest Social Security office.
The initial enrollment period is a period of
seven full calendar months, the beginning and end of which is determined for
each person by the day on which he is first eligible to enroll. The initial
enrollment period begins on the first day of the third month before the month a
person first becomes eligible to enroll and ends with the close of the last day
of the third month following the month a person first becomes eligible to
enroll. For example, if the person’s 65th birthday is April 10, 2013, the
initial enrollment period begins January 1, 2013 and ends July 31, 2013.
If a person
decides not to enroll in the initial enrollment period, he may enroll during a
special enrollment period. The special enrollment period is a period provided
by statute to enable certain individuals to enroll in Medicare without waiting
for the general enrollment period.
In order to
obtain coverage at the earliest possible date, a person must enroll before the
beginning of the month in which age 65 is reached. For a person who enrolls
during the initial enrollment period, the effective date of coverage is as
follows:
(1)
If the person enrolls before the month in which age 65 is reached, coverage
will commence the first day of the month in which age 65 is reached.
(2)
If the person enrolls during the month in which age 65 is reached, coverage
will commence the first day of the following month.
(3)
If the person enrolls in the month after the month in which age 65 is reached,
coverage will commence the first day of the second month after the month of
enrollment.
(4)
If the person enrolls more than one month (but at least within three months)
after the month in which age 65 is reached, coverage will commence the first
day of the third month following the month of enrollment.
A seven-month
special enrollment period is provided if Medicare has been the secondary payer
of benefits for individuals age 65 and older who are covered under an employer
group health plan because of current employment. The special enrollment period
generally begins with the month in which coverage under the private plan ends.
Coverage under Medical Insurance (Part B) will begin with the month after
coverage under the private plan ends if the individual enrolls in that month,
or with the month after enrollment if the individual enrolls during the balance
of the special enrollment period.
13. What if a person declines to enroll during the automatic enrollment
period?
Anyone who
fails to enroll during the initial enrollment period may enroll during a
general enrollment period. There are general enrollment periods each year from
January 1st through March 31st. Coverage begins the following July 1st.
The premium
will be higher for a person who fails to enroll within 12 months, or who drops
out of the plan and later re-enrolls. The monthly premium will be increased by
10% for each full 12 months during which he could have been, but was not,
enrolled.
If a person
declines to enroll (or terminates enrollment) at a time when Medicare is
secondary payer to his employer group health plan, the months in which he is
covered under the employer group health plan (based on current employment) and
Hospital Insurance will not be counted as months during which he could have
been but was not enrolled in Medical Insurance for the purpose of determining
if the premium amount should be increased above the basic rate. These people may
then enroll during the “special enrollment period.” The special enrollment
period lasts for seven months and starts the first month the person is not
covered by a group health plan.
Individuals
must meet the following conditions to enroll during the special enrollment
period:
(1)
They must be eligible for Medical Insurance (Part B) on the basis of age or
disability, but not on the basis of end-stage renal disease.
(2)
When first eligible for Medical Insurance coverage (fourth month of their
initial enrollment period), they must be covered under a group health plan on
the basis of current employment status or, if not so covered, they must enroll
in Medical Insurance during their initial enrollment period.
(3)
For all months thereafter, they must maintain coverage under either Medical
Insurance or a group health plan. (Generally, if an individual fails to enroll
in Medical Insurance during any available special enrollment period, he is not
entitled to any additional special enrollment periods. But if an individual
fails to enroll during a special enrollment period because coverage under the
same or a different group health plan was restored before the end of that
particular special enrollment period, that failure to enroll does not preclude
additional special enrollment periods.)
For an
individual who is or was covered under a group health plan, coverage must be by
reason of the current employment status of the individual or the individual’s
spouse.
Individuals
entitled to Medicare on the basis of disability (but not end-stage renal
disease) must meet conditions that vary depending on whether they were covered
under a group health plan or a large group health plan.
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