Medicare Unit 7

Medicare Part A Payment Plan Beneficiary Pays (2009) Hospital Stays 1-60 days $ days $267/day days $534/day 151+ days all costs Monthly premium $244 SNF 1-20 days nothing days $ per day max 101+ days all costs Annual deductible $1,068 2

Medicare Part A Payment Plan Beneficiary Pays Home Health Care Nothing for approved home health care services 20% of approved durable medical equipment Hospice Co-payment of $5 for prescription drugs 5% of Medicare- approved amount for respite care 3

Medicare Part B Beneficiary Pays Medical & Other $135 deductible $96.40 per mo. premium 20% of Medicare approved physician cost 20% outpatient physical, occupational, & speech- language therapy 50% outpatient mental health care Home Health Care Nothing for Medicare- approved services 20% of Medicare-approved durable medical equipment Premium higher for singles with incomes of $85,000 + & incomes of $170,00 + 4

Medicare Part B Beneficiary Pays Clinical Lab Services Nothing for Medicare- approved services Outpatient Hospital Services 20% of billed amount after deductible 5

Other Part B Coverage  Insurance Company incentive - $12 billion in subsidies to private insurers that offer health plans to Medicare beneficiaries.  Beginning 2010 Medicare will face competition among private insurance plans.  Medicare savings accounts – tax shelters for individuals with deductibles above $1,000 for singles & $2,000 for couples. 6

Prescription Drug Benefit (2009)  Premium - $450/yr  Deductible - $250  Coverage – 75% of drug costs up to $250; 25% $259 - $2,250  Gap – no coverage between $2,250 – $5,100  After $5,100 Medicare pays drug costs  Low-income subsidies – premium, deductible, & coverage gap waived for those at 135% FPL & lower ($22,588 for couples) & have less than $6,000 liquid assets  Company incentive – tax-free subsidies to employers who maintain to insurance companies 7

Medicare Advantage + Choice Plans Beneficiary Pays Part ASame payments Part B$58.70/mo. premium + additional Choice Plan’s premium (?) Choice Plan’s co-payments for services 8

“Accepting Assignment” Payment to Physician Medicare paysBeneficiary pays Physicians accepting assignment 80% of approved charge 20% of co- payment Physicians not accepting assignment 80% of approved charge 20% co-payment + 15% of additional cost 9

Example of Accepting Assignment Medicare paysBeneficiary pays Physician accepting $100 per visit $80$20 Physician not accepting $120 per visit $80$20 + $3 (15% of $20) 10

Medicaid  Monthly income of $1,737 for single  Spend down to $2,000 liquid assets for institutionalized spouse Entire SSI goes to pay for institutionalization  Community spouse can have between $95,100 in assets Maximum monthly income $1,737 Window – 3 yrs from date of institutionalization or 5 yrs for transfers to trust 11

Main Problems in Providing Care for Elderly  Limited coverage under Medicare −homebound status −skilled nursing  1.4% or $13/mo increase in SSI – 1/3 of this will go for increase in Medicare premiums  Private insurance option at cost to elderly  Cost of home health care services expensive  Cost of long-term care expensive  Problems with managed care plans 12

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