Senior Living Communities

Medicare is one of the most widely used resources for senior living. It is the bread and butter of our countries medical system for retirees and seniors in general. It is a government sponsored program that is offered to people who are 65 years of age and older, or people who are disabled.

Medicare cannot be used to pay for senior lifestyle or housing options as some seniors believe. Medicare can only be used for medical purposes. Coverage differs from plan to plan so it is vital to know which plan covers what.

The Medicare program is divided into four parts. Part A covers hospital and inpatient services and Part B covers doctor visits and other outpatient services. Together, Parts A and B are referred to as original Medicare. Part C, also known as Medicare Advantage, makes Medicare-covered services available through private health plans, such as HMOs, PPOs, and private fee for service plans. Part D was created under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 to cover the costs of prescription drugs.

Keep in mind that with Original Medicare beneficiaries can choose any doctor or specialist who accepts Medicare, and is available nationwide. Original Medicare is administered directly by the federal government. Under Part C, private health insurance companies can contract with the federal government to offer Medicare benefits through their own policies.

Original Medicare Plan (Plan A)

Plan A is very basic coverage and is the only coverage that does not have a premium free. It covers the majority of your health care costs, but leaves you responsible for a portion as well; usually referred to as the deductible. It is also referred to as the hospital coverage plan. Plan A covers the following:

• Inpatient hospital stays
• Stays at a skilled nursing facility (i.e., where medically necessary skilled nursing and rehabilitation care are provided)
• Home health care
• Psychiatric inpatient care
• Hospice care

Benefit Periods

It is important to note that senior living resources in Plan A are covered by benefit periods of 60 days. This means that when you are admitted to a hospital, Medicare coverage will last 60 days for an illness, as long as the care does not turn custodial in that time frame. If you are admitted to a hospital for an illness, then released and readmitted within a 60 day period, you are only charged a deductible for the first entry. The bad news is that the first admission is tacked on to the second one in calculating the percentage amount Medicare will cover, since Medicare full coverage is only for 60 days. There is no set number of spells of illness Medicare will cover in your lifetime.

Inpatient Hospital Stays

In addition to the previously mentioned coverage, Medicare Plan A will pay:

• Beneficiaries entitled to a lifetime reserve of 60 additional days. If those reserve days are also used, beneficiaries must pay $534/day in 2009 for days 91 to 150
• If you choose not to use your lifetime reserve, all Medicare coverage stops after 90 days of inpatient care or after 60 days without any skilled care for this spell of illness
• A semiprivate room with necessary amenities
• Nursing services, medications, lab tests, X-rays, medical supplies, use of equipment like wheelchairs
• Operating room, recovery room and rehabilitation services

Skilled Nursing Facility Care

Plan A does not cover nursing home care, only skilled nursing facilities. To gain coverage:

• A physician must certify that you require daily skilled care that can only be provided for an inpatient in a skilled nursing facility
• You must have been an inpatient in a hospital for at least three consecutive days for the same illness or condition before being admitted to the skilled nursing facility
• Your admission to the skilled nursing facility must be within 30 days of discharge from the hospital to receive Medicare
• The facility must be Medicare-approved to provide skilled nursing care

To find our information on the hospice and psychiatric inpatient care click here.

Plan B

Plan B is the senior seniors living resource that covers care that is not usually inpatient. It is financed through monthly premiums paid by enrollees and by contributions from the federal government. This plan covers things like physician services and outpatient hospital care along with

• Physician and surgeon fees
• Outpatient services
• Immunosuppressive drugs
• Blood service, after you pay for the first three pints of blood in any calendar year
• Clinical laboratory services
• Some coverage for outpatient mental health visits
• Ambulance service

Medicare Part B covers 80 percent of medically necessary physician or outpatient charges, including charges from a physician for care received in a hospital. It can also be referred to as the medical coverage plan.

Premiums

Premiums have a deductible like Plan A. However, there is a standard premium each year that usually increases from year to year because it is indexed for inflation. The monthly premium will increase if you file an individual income tax return and your modified adjusted gross income (MAGI) is more than $85,000, or if you file a joint income tax return and your MAGI is more than $170,000.

The deductible in 2009 did not increase from 2008 but is unclear if it will be raised this year.

Coverage

There are certain specific things not covered by Plan B, most notably (as in Plan A) prescription drugs. This is not covered in any plan other than Plan D. Plan B only covers procedures they deem reasonable or that are medically necessary.

There are some preventive services Plan B does cover such as annual mammograms, pap smears, Hep B vaccines for high-risk individuals, self-management training for people with diabetes, prostate and colorectal cancer screening, bone density measurements for women at risk for osteoporosis and pelvic and breast cancer screenings every three years for women.

Medicare Advantage (Plan C)

Because private companies fund part of this program, they can offer regular Medicare coverage along with managed care plans (such as HMOs) and preferred provider organizations (PPOs). Plan C is only available to people who also have Plan A and Plan B. Having this added option allow beneficiaries to have the best medical coverage at the lowest cost available to them because the private insurance companies can manage the costs after looking through a network of providers.

In 2003 the Medicare Prescription Drug, Improvement, and Modernization Act was passed, which changed a lot of things about Plan C and incorporated Plan D which we will discuss later.

Types of Medicare Advantage Plans

• Private fee-for-service-most flexible and most costly
• Managed care-choice of health care provider is limited and in a network, but it’s cheaper
• Advantage PPOs-only can use doctors inside the network (like managed care) but for a fee can use doctors outside the network

Enrollment

Unfortunately, this plan is not available nationwide. Even if it is available in your area, there are only certain times of the year it is available for enrollment and coverage change.

One enrollment period occurs from Nov 15-Dec 31 of each year. During this time period, anyone with Medicare can select a new Medicare health plan and/or a Medicare prescription drug plan or make other changes to their coverage. You can also join or switch Medicare Advantage plans from Jan 1-March 31 of each year, but because you can’t join or drop Medicare prescription drug coverage during this time period, your options are more limited.

Part D

Prescription drug coverage is offered by private companies through stand-alone plans (for members who have original Medicare) and through HMOs, PPOs, and PFFSs. Also, anyone who has original Medicare or Medicare Advantage is eligible to enroll in Part D.  Some of the Medicare Advantage plans already cover prescription drugs, but for those beneficiaries that don’t and who only have the basic coverage, Plan D has these basic criteria:

• The annual deductible can’t be more than $295 (in 2009)
• The plan must cover at least two drugs in each drug class
• The plan must cover substantially all drugs in these six categories: antidepressants, antipsychotics, anticonvulsants, antiretrovirals (AIDS treatments), anticancer drugs, and immunosuppressants
• Members must be able to seek an exception if a drug is medically necessary but not covered under the plan
• Plans must have a network of pharmacies
• Lists of covered drugs and pharmacy networks must be readily available to members
• Plans must work with nursing homes
• Plans must help transition a member’s current drug coverage
• Plans must offer catastrophic coverage that is at least as good as the coverage outlined in the 2003 Medicare Act

Keep in mind that this is a very basic list and that different plans host different drug availability. Some of the basic options that are not available with Plan D are:

• Over-the-counter drugs
• Most prescription vitamins and minerals
• Certain anti-anxiety and anti-seizure drugs
• Fertility drugs
• Drugs for weight loss or gain, and anorexia
• Cosmetic and hair growth drugs
• Drugs that treat symptoms of the common cold (e.g., coughs, congestion)
• Drugs covered under Part A or Part B

Cost

Depending on the type of coverage you get, the price will change. No matter what plan you buy, however, you will get premiums. The average price for the monthly premiums is around $30. Keep in mind that this premium is in addition to other premiums you pay in Plan B. There is also the option of paying annual premiums, which with basic coverage cost around $300. In addition to the premiums, you need to pay 25 percent of the cost of prescriptions; Medicare pays for the other 75 percent.

There are complicated date fees and certain amounts you need to pay based on how much you spend, but those are all very specific and need to be asked to a Medicare professional.