The IRS Deductions Blog

Posts Tagged ‘medicare’

Question: After the deductible, does MEDICARE PARTS A, B and D (combined) pay ALL of a patients costs?

Answer: No, it doesn’t. That’s why you need either a Medicare Supplement or a Medicare Advantage plan.

The Part A deductible will pay for 60 days in the hospital. Day 61 – 90 will cost $267 per day and day 91-150 is $534 per day. You pay all costs over day 150.

After the Part B deductible you pay 20% of the charges. If the doctor doesn’t accept assignment they can also charge you up to 15% more than the Medicare approved amount. For example, if the charge is $100 they can charge $115. Medicare will pay 80% of the $100, which leaves you paying $35.

There are also many things Medicare does not pay, such as physicals, routine dental and vision, and long term care.

Part D is the drug coverage and is purchased from private insurance companies. They have to follow the Medicare template, which is first a $295 deductible. Then you pay approximately 25% of the cost until both you and the insurance company pays $2700. You then pay 100% of the cost until you have an out-of-pocket cost of $4350. You then pay approximately 5% of the cost. All companies have plans that improve on the template and all are different. Depending on your Medications there can be hundreds of dollars difference in your costs every month.

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In & Around Town

SATURDAY, Oct. 4 The second ‘Shop ‘n’ Rock’ will be hosted from 1 to 6 p.m. at the Budd Lake Firehouse, Route 46. The event is sponsored by the Mount Olive Kiwanis and Mount Olive Fraternal Order of Police Lodge 122. The family event will include food, activities, music, a kid’s play zone and vendors. Vendors and sponsors are sought and should visit www.mtolivekiwanis.org[[[SHIFTIN …

Health Care Reform-fact or fiction

It is perhaps known to all what a health insurance plan is. Still for the sake of our discussion it can be said that a health insurance plan is a helping aid for your unexpected medical costs. It is a contract between an individual and an insurance company in which the type and amount of health care costs that would be covered by the plan are specified and for which the individual agrees to pay premiums. These contracts are renewed either monthly or annually.

However, the origin of the health care insurance plans can be traced back in 1694 when it was first proposed by Hugh the Elder Chamberlen from the Peter Chamberlen family. The first form of health insurance plans was available in the market as the accidental insurance plans during the late 19th century. The first accidental insurance plans were somewhat like the modern day disability insurance plans. And until the start of the 20th century there were no other health care insurance plans other than these accidental insurance available in the market. Therefore the accident insurance plans can easily be considered as the first form of health care insurance available in the market. However after the regulation of the law during the beginning of the 20th century this type of insurance was categorized under the disability insurance.

However, with the signing of the contract the individual needs to pay his premiums either monthly, quarterly or annually as mentioned in the contract and on behalf of which the insurance company is bound to pay for the medical costs, co payments and deductibles as mentioned in the contract for the specified plan. However, the fact is that no payments would be made on behalf of the company more than what is written in the contract paper. And along with this it should be mentioned that the Original Medicare plans does not cover all of your Medical costs. Therefore there remains always a gap between the Medicare policy coverage and the actual medical bill payable by you. Thus in this case if you need total coverage then you must be needing a Medicare Supplement Plan along with your Original Medicare policy so that you can pay off all your medical bills.

Now the question is what are Medicare Supplement Plans? The Medicare Supplement Plans are supplementary health insurance policies soled by the private health insurance companies to bridge the gap between the policy coverage of the Original Medicare and the total amount of medical bill payable. For this reason these plans are also known as the Medigap policies. These plans are solely under the administration of the private insurance companies. But the fact is that there are only twelve standard Medicare supplement policies that these companies can sell. These plans are categorized under the letter covers A through L.

The point to be noted is that each of these Medicare Supplement Plans have their own set of benefits and each and every company should provide the same benefits for the plan under same letter head. This means that if you purchase a Medigap Part C plan from a company then the company is bound to provide you the same benefits provided by the other companies or as mentioned in all part C plans. But along with that it should be remembered that the amount of premium payable can differ from other companies.

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Program helps Medicare recipients pay for their prescription medicines

Area Medicare recipients could qualify to save an average of $3,900 on their prescription drugs with the Extra Help program.

Had enough of Bill Shuster? Vote for Tony Barr

The supplementary insurance policies that are sold by the private insurance companies to cover up the gaps left behind by the Original Medicare policies are known as the Medicare supplement plans or the Medigap plans. These plans are sold and administered by the private insurance companies only. And there are twelve standard medigap plans available in the market. These plans are meant to pay for some of the medical costs that the original Medicare Plan does not pay. If you are having a Medicare Plan then you shall be needing a Medicare supplement plan along with that to pay off your total medical bill. These plans are labeled from A through L and each of these policies have their unique set of medical coverage. Therefore one should be very particular while choosing his Medicare Supplement Plan. But along with that it should also be remembered that the Medicare part A is considered as the most basic plan and therefore the benefits of the Medicare plan A are included in all of the Medicare Supplement Plans.

Another notable thing about the Medicare Supplement Plans is that from whatever company you may purchase the Medicare plan it is sure that you shall get the same policy coverage. This means that if you purchase a Medigap plan C policy then it is sure that you shall get all the benefits of the Medigap plan C policies and there would be no change in the policy coverage with the change in the company. Therefore the purchase of the Medigap policies is irrespective of the insurance companies. But the point to be noted in this context is that the rate of premium payable may change with the change in the company. This means that the private insurance companies are free to fix the charges for all the Medicare Supplement Plans.

The choices for the Medigap policies are very important. It is always better if you go through the offer documents of all the Medigap plans carefully before deciding the one to choose from the twelve plans. An insurance agent can better help you out in this respect. As the insurance agents are more in touch of the regular details of the Medicare Supplement Plans therefore it is much easier for them to know the policy coverage and the premium rates of the different companies. Sometimes it is often seen that a Medigap policy which apparently seem to be less beneficial may turn out to be a much profitable deal by saving you a lot of money in the form of deductibles therefore while choosing your Medigap plans pay proper attention on the policy coverage that the plan offers.

However, by 2010 there is going to be some new launches and a change in the standard Medicare Supplement Plans. Two new plans M and N are to be included in the list of the standard Medigap policies. It is believed that these two plans are going to reduce the premium rates and would provide a lot more benefits than the existing plans. Therefore it is on time to notice what real changes are coming through the introduction of these new plans.

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Expect higher health-care costs in 2010

Last month was open-enrollment season, and my wife and I got an unpleasant surprise. For 2010 we’re looking at an annual health-insurance premium that’s $1,600 higher than it is now, plus higher deductibles.

Health Care 2009 – David Wilson, Myra Christopher, Elaine McIntosh

Question: Home Owners Insurance – Higher Deductible or Higher Premium?

When buying a Home Owners Insurance, what is the best approach…. Keeping Higher Deductible or Higher Premium?

Answer: $500 Deductible? That is NOT a high deductible.

But since you shouldn’t be claiming small claims, because 2 will get you cancelled, you should take a high deductible. The premium savings varies, between 10% and 25% off the $500 deductible, if you take a $1000 or $2500 deductible.

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Teens can raise insurance costs

Dear Action Line: My 16-year-old has his ‘intermediate license’ but can’t stop texting long enough to ask for the car. What should I look for on insurance? — W.S., Tulsa.

Lowering Premiums by Paying for Routine Care (Step 3)

Question: cancel medicare part A would required repayments of all bills up to the cancelation date ?

I was told I need to cancel medicare part A and B to enrol into
high Deductible Policy with HSA plan thru my employer.

Answer: You should never cancel your Medicare. The specifics of what you have available to you and what you should do would depend on factors such as what you have, and why. Do you have A&B now? Are you under 65 and on Medicare through disability? Do you have Medicaid or any other sponsord assistance? Do you have any additional coverage in the form of an employee sponsored plan, group plan, medicare supplement, medicare advantage plan or prescription coverage such as Part D?

You can get a plan similar to a HSA using your Medicare A&B from companies that sell Medicare insurance. It is called a MSA (Medical Savings Account) and would have a lot of similarities, but some differances. Namely, you typically pay no premium to enroll, you have an amount put into the account for you by Medicare, have a deductible to meet after the funds are used, and then typically have a 100% coverage level (up to Medicare approved (Medicare assignment) levels of payment for approved services). This might be an alternative.

You can not really give up your part A of Medicare. When you qualify, it is given to you, for free (from your taxes paid). Part B is something you pay for unless you have assistance. It is the part B that sometimes messes with your other insurance, but is necessary for supplements, advantage plans, etc. You CAN choose to postpone enrolling into part B if you have a qualifying plan, but it is generally not a good idea to leave it. With moth employer group plans you can have both parts and they work around Medicare, and if/when you leave that work sponsored plan you qualify to enroll in supplements. A HSA may be different because of the tax structure involved. I would call 1-800-MEDICARE to be sure.

Items on Amazon Right Now for Medicare Deductibles:

Federal Share of U.S. Health Spending Rises Faster Than Private

Federal spending on medical programs grew almost twice as fast as the total spent on health care in the U.S. in 2008, a pattern aided by Medicare subsidies to private insurers.

Health Benefits