Medicare
I'm a retired Federal employee with FEHB health insurance. My insurer is telling me I have to use Medicare part A. I don't want to use it because that's taxpayers money. I paid for insurance coverage for 30 years as a civil servant without taxpayer input. What is going on?
By federal law, Medicare is the "primary" payer for anyone over age 65 who is retired and enrolled in Part A. If you are hospitalized, Medicare Part A is the primary payer and your PSHB plan will in many cases pay the remainder (depending on which plan you are in). This is explained in Section 9 of every PSHB brochure. You shouldn’t feel that this is unfair to others, since you have an earned entitlement benefit in both programs and whenever people have double coverage there have to be rules about which pays first and which pays second.
My wife and I are enrolled under Medicare A and B with BCBS Basic as the supplemental carrier. I thought preferred provider restrictions largely disappear as long as the provider accepts Medicare. Recently, my wife didn't get free care from an out of network provider, although Medicare provided its usual and customary compensation to the provider.
Almost all plans that have "Medicare wraparound" cover all costs to any provider who accepts Medicare, whether in or out of the plan network. But BCBS Basic is an exception. The wraparound applies only to the network providers in that plan. Medicare, of course, does pay its 80%. And you get a much lower premium for this limitation.
I am retiring at age 65. I have another job starting after my retirement from the federal government. Since I will no longer be a federal employee, will I need to sign up for Medicare Part B right away or face the 10 percent penalty?
You will have an eight-month period to enroll in Medicare Part B after you retire and are no longer covered by an employer health insurance plan. If you delay beyond that and enroll, you will be subject to the 10 percent late enrollment penalty. But you can postpone the penalty indefinitely if you sign up for health insurance with your new employer. Of course, this will mean extra premiums and double coverage, but it may be a less expensive way to combine plans.
I'm still working and just turned age 65. Should I sign up for Medicare?
Do not sign up for Medicare Part B until you retire. You will pay a lot of premium for little or no benefit because Part B is "secondary" for employees over age 65 and covered by an PSHB plan. You can enroll in Part B when you retire, at any age, with no penalty. As for Part A, you might as well enroll since it is free to you, but you won't get much benefit from it as it also is secondary. But if you are in a High Deductible plan do not enroll in Part A until you retire because that will end your ability to add money to your Health Savings Account.
What is the best plan for people with Medicare Parts A and B?
There is no simple answer, since even with a Medicare wrap around in which you pay nothing for hospital or doctor with Parts A and B, drug benefits will still vary. Plans that we rate as very good buys are Aetna Direct Consumer Driven, MHBP High Deductible, APWU Consumer Driven, Blue Cross Basic, GEHA Standard, NALC High, NALC Consumer Driven, and in the DC metro area Kaiser Standard, CareFirst Standard, and CareFirst High Deductible. You should also strongly consider Medicare Advantage plans offered by Aetna, Kaiser, and UnitedHealthcare which have some of the lowest estimated yearly costs available to retirees.
Does Blue Cross Basic have the same Medicare waiver as Blue Cross Standard for retirees?
With Medicare Parts A and B both plans cover you 100% for hospital and doctor expenses from in-network providers. BCBS Standard does the same for all other physicians that participate in Medicare, like most other plans with the waiver (NALC High, GEHA Standard, Aetna Direct, etc.). But with BCBS Basic you get nothing but Medicare coverage outside the network. Since Part B pays 80%, this is still a very good situation, and with the premium savings we rate BCBS Basic a very good buy.
Some of the plans I am looking at only give you the wraparound benefit if you use doctors who accept Medicare "assignment." Is this a problem?
It is a limitation compared to some other plans that give you the wraparound for all doctors who participate in Medicare, whether or not they accept "assignment." But the great majority of doctors do accept assignment so these plans still offer excellent access. You will have to weigh how important this is and may want to check with any doctors you now use to be sure you will get their care at no cost.
Would you kindly explain the term Medicare wraparound benefit? I don't understand what that refers to or what it covers.
It means that the plan "wraps around" the Medicare payment (Medicare is "primary") and that the plan pays whatever Medicare doesn’t pay, for hospital or physician or both, depending on what the plan offers. It is sometimes called a "waiver" because the plans sometimes describe it as waiving cost-sharing for hospital and physician services. The important thing about this benefit, whatever it is called, is that between Medicare and the plan there is zero cost-sharing for these expenses, in or out-of-network. (Sometimes the benefit is limited to physicians who accept Medicare "assignment," which is not a major restriction for most.) In simpler terms, most of your health care will have $0 out-of-pocket costs if you have Medicare Parts A and B.
Is there an option in your Guide that allows employees/retirees to easily see all of the PSHB plans that waive copays and deductibles if they’re enrolled in Medicare Part A and Part B?
In our plan flexibility comparison we show plans in the same order as in their overall cost ratings.
The Blue Cross brochure seems to say that the Basic option offers a wraparound benefit but also says you may have to pay 115% of the Medicare approved amount. What gives?
With Part B, BCBS Basic provides free coverage of essentially all hospital and medical expenses if you use providers in its "preferred network." This is most providers, but far from all. Still, most people find it easy to stay in-network. Even if you go out-of-network, Medicare covers you directly for Medicare participating doctors and your out-of-pocket costs will be low. BCBS Basic is a good choice, especially considering the premium savings compared to many other plans. There are, however, some national plans that provide wraparound for all Medicare providers, not just network providers.
My 93 year old mother has Medicare A and B. Will BCBS Basic work as well as BCBS Standard?
When she uses BCBS preferred network providers, it will work identically. She will pay nothing for hospital or doctor care. If she were to use a non-network physician, she wouldn’t get the 100% wrap around in BCBS Basic, but would get it in BCBS Standard. However, even in this case Medicare Part B would pay 80% of the charge. So unless she frequently uses doctors who don’t participate in the Blue Cross network, the BCBS Basic’s lower premium cost will make it financially advantageous. Peace of mind and simplicity are two additional factors important to many: under BCBS Standard hospital and medical care are "free" regardless of network status of any provider (assuming that they participate in Medicare and are accepting new Medicare patients), and hassle is minimized.