Medicare Flashcards
1
Q
Medicare
A
- Universal health coverage and insurance for those 65 years and older and disabled
- Medicare Act amended to the Social Security Act in 1965– created Title XVIII
- Covers 55 million Americans
- 46 million over 65 years old
- 9 million disabled
- Costs $646.2 billion, approximately 14% of federal budget in 2015
2
Q
brief hx of medicare
A
- Medicare is the federal health insurance program for people who are:
- 65 or older,
- certain younger people with disabilities, and
- people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD).
3
Q
Part A (hospital insurance)
A
- Part A covers:
- inpatient hospital stays,
- care in a skilled nursing facility,
- hospice care,
- some home health care.
- Little parts from your paycheck go into this type of insurance
- You have to be “invested” in your retirement
- What if you were a stay at home dad and now youre 65 and you want medicare: you have to pay
4
Q
part A cost
A
- Most people don’t pay a monthly premium for Medicare Part A (Hospital Insurance) coverage (if you or your spouse paid Medicare taxes while working). This is sometimes called “premium-free Part A.”
- If you have to buy Part A (due to lack of eligibility), you’ll pay up to $407 each month.
5
Q
Part A funding
A
- Funded by 2.9% payroll tax
- Worker’s contribution is matched by employers (1.45% from employees, 1.45% from employers)*
- Deposited into “Medicare trust fund”
- *ACA increased this contribution by 0.9% for individuals earning >$200,000 and couples earning over $250,000
- Hospital
- Paid for by government after patient pays deductible
- After 60-days (per illness) patient has additional co-insurance
- After 90-days (per illness) patient pays even more
- After 150-days (per illness) no further Medicare coverage
- Nursing Home
- Paid for by government
- After 20-days patient must pay co-payment per day
- No coverage after 100 days
- If no hospital stay, no coverage
6
Q
Part B (medical insurance)
A
- Part B covers:
- certain provider services,
- outpatient care,
- medical supplies,
- preventive services.
7
Q
enrollment in medicare parts A and B
A
- Usually automatic enrollment in Part A:
- you’ll get your Medicare card in the mail 3 months before your 65th birthday - or your 25th month of disability.
- If not eligible automatically, i.e. not getting Social Security benefits, for example, because you’re still working, or have End-Stage Renal Disease (ESRD), you have to sign up w Social Security.
8
Q
enrolling in part B
A
- Part B is voluntary – you must enroll and pay a premium
- In most cases, if you don’t sign up for Medicare Part B when you’re first eligible, you’ll have to pay a late enrollment penalty for as long as you have Part B, and could have a gap in your health coverage.
9
Q
part B cost
A
- Most pay the standard Part B premium of $134 each month; some pay additional Income Related Monthly Adjustment Amount (IRMAA)
- The Part B deductible is $183 per year
- Co-insurance (after meeting deductible) is 20% of Medicare-approved amount for:
- most doctor services (including most doctor services while you’re a hospital inpatient),
- outpatient therapy,
- durable medical equipment.
- Must sign up for Part B when first eligible, or may have to pay a late enrollment penalty.
10
Q
part B funding
A
- Federal government pays 75% (out of general fund)
- Beneficiaries pay 25%
- Beneficiaries with higher incomes pay higher monthly premiums
11
Q
medicare beneficiary costs
A
- In 2017, the annual costs to beneficiaries for Medicare A & B are:
- No Part A premium
- Part A hospital deductible per hospital stay ($1316)
- Part B premium ($134+)
- Part B deductible ($183)
- 20% coinsurance for all charges under Part B (except primary care)
- Up to additional 15% for “non participating” physicians
- All Rx costs
- Dental Care
- Eye glasses, hearing aids, foot care, etc.
- Dont need to memorize numbers
12
Q
part C (medicare advantage plans)
A
- Medicare health plans offered by a private companies that contract with Medicare to provide Part A and Part B benefits.
- Health Maintenance Organizations (HMOs),
- Preferred Provider Organizations (PPOs),
- Private Fee-for-Service Plans (FFS),
- Special Needs Plans,
- Medicare Medical Savings Account Plans.
- Most Medicare services are covered
- Most offer prescription drug coverage.
- These are private health plans that the government is contracting for them to provide
- The people with these are not getting part A, or B
13
Q
medicare part C / advantage plans - costs
A
- Varies with company and plan out-of-pocket costs depend on:
- monthly premium, including Part B
- yearly deductibles.
- copayment
- coinsurance
- yearly limit on out-of-pocket costs
- type of plan and network (PPO, PFFS, or MSA) and only use network providers
- need for extra benefits and plan charges
- Medicaid eligibility
14
Q
medicare part D (prescription drug coverage)
A
- Part D adds prescription drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private-Fee-for-Service Plans, and Medicare Medical Savings Account Plans.
- offered by insurance companies and other private companies approved by Medicare.
- Medicare Advantage Plans (Part C) may also offer prescription drug coverage that follows the same rules as Medicare Prescription Drug Plans.
15
Q
part D costs
A
- What you pay for generic drugs during the coverage gap will decrease each year until it reaches 25% in 2020.
16
Q
the “donut hole” in 2015 and beyond
A
- Most Medicare Prescription Drug Plans (Part D) continue to have a coverage gap (also called the “donut hole”).
- This gap begins after you and your drug plan have spent a certain amount for covered drugs
- In 2016, once you and your plan have spent $3,310 on covered drugs, you’re in the coverage gap.
- This amount may change each year. People with Medicare who get Extra Help paying Part D costs won’t enter the coverage gap.
- People may qualify if they n yearly income less than $17,655 i ($23,895 for a married couple) and less than$13,640 in resources ($27,250 for a married couple).
- if you meet certain income and resource limits, you may qualify for “Extra Help” from Medicare to pay the costs of Medicare prescription drug coverage.
- Drug costs for most people who qualify are no more than $2.65 for each generic/$6.60 for each brand-name covered drug. (In 2016, costs are no more than $2.95 for each generic/$7.40 for each brand-name covered drug.)
- Other people pay only a portion of their Medicare drug plan premiums and deductibles based on their income level.
17
Q
proportion of federal budget
A
18
Q
medicare demographics
A
- In 1960s
- Approximate 9.5% of country’s population was 65 years or older
- A 65 year old man was expected to live an additional 13 years on average; a woman, 17 years.
- In 1990s
- 12.3% of population was 65 years or older
- Additional life expectancy now 15.1yrs for men, 18.9 for women
- In 2010+
- +/- 13.3% over 65
- 19.7% in 2030
- Fastest growing age are those over 85 years of age
19
Q
characteristics of the medicare population
A
20
Q
medigap insurance
A
- Medicare Supplement Insurance policies, sold by private companies, can help pay some of the health care costs that Original Medicare doesn’t cover, like copayments, coinsurance, and deductibles.
- 89% of Medicare beneficiaries have a supplemental insurance policy:
- Purchasing from private insurance company (17%)
- Receiving as retirement benefit from former employer (34%)
- Enrolling in Medicaid (if low income) (15%)
- Joining a Medicare managed care plan (22%)
- 11% choose not to purchase supplement insurance
- Supplemental coverage for Medicare beneficiaries.
21
Q
DRGs (initiated in 1983)
A
- Changed hospital payment structure, thereby changing incentives:
- Paid a fixed amount each time a patient was admitted to the hospital rather than the cost of care
- Each Diagnostic Related Group (DRG) has a reimbursement amount associated with it
- The reimbursement amount reflects the average cost of treating that diagnosis
- If hospital provides care for less than average cost, it can keep the difference
- If cost of care is more, the hospital absorbs the difference
22
Q
Medicare and managed care: medicare part C
A
- In order to save $$$, in the 1980s the Federal government started letting Medicare beneficiaries enroll into HMOs (with plan taking risk)
- Paid plans 95% of what would have paid for the beneficiary in traditional, FFS Medicare
- HMOs were required to offer ALL that was offered under Medicare; could offer more
- Most HMOs offered Rx and many did so without a premium….
- Competed by offering more and more “extra” benefits
23
Q
medicare advantage and cherry picking
A
- Part C Medicare Advantage Plans may target healthier, younger Medicare beneficiaries (“favorably selecting,” or “cherry picking”)
- While the Private Insurance Plan is paid “average” costs of beneficiaries in the area, they may actually have lower costs than the average.
- This leaves Traditional FFS Medicare facing “adverse selection,” with sicker, more costly patients
24
Q
long term financing of medicare
A
- Greatest challenge to future of Medicare
- Increasing health care costs
- Aging US population
- Between 2010 and 2030, number of beneficiaries projected to rise from 46 million to 78 million
- Declining ratio of workers to beneficiaries
- Changing solvency projections – when will funding be less than needed?
