Texas Medicare Insurance

Understanding Medicare

Texas Medicare is the health insurance our federal government offers to our seniors over 65 and for people under 65 with certain disabilities. In order to be eligible to go on Medicare in Texas you must be a US citizen or a legal resident for at least 5 consecutive years.

There are 2 parts to what is called Original Medicare, Part A and Part B.

Part A

Part A helps with your hospital stays and the skilled nursing after your hospital stay. It also provides assistance for hospice care required for the terminally ill and some very limited home care. If you have contributed towards Social Security for more than 10 years you will be automatically signed up once you begin collecting your retirement benefits and there are no premiums to pay. For those who have not contributed towards social security for 10 years can expect to pay up to $450/month in 2011. You can also visit any provider who accepts Medicare but it is important to know that there is still a cost sharing component that you will be responsible for paying:

Deductible- You are responsible for paying the first $1,132 in 2011 for each stay before Part A will begin to pay.

Coinsurance – This is when you you will pay a percentage of the Medicare approved amount and Medicare pays the other percentage. For example, in 2011 you will pay 5% of the Medicare approved rate for respite care while your usual care giver takes a rest.

Copayments – This is a fixed price for a particular service or product. For example, Medicare pays for the first 20 days of skilled nursing but for days 21-100 you will be responsible for a copay of $141.50/day in 2011. After the 100 days are up you will be responsible for 100% of the cost.

Part B

Medicare part B helps you with your physician services and other medical services like doctor visits, outpatient care, diagnostic procedures, laboratory tests and preventative services just to name a few. Since there is a premium you must pay for part B, it is voluntary. Your able to enroll in Medicare Part B within 3 months before your birthday month and 3 months after your birthday month but you don’t want to miss it because it can cost you money and you will have fewer options. The premiums are based on your yearly income and usually deducted form your Social Security check. In 2011, the premiums are within $115.40/month to $369.10/month. There is also a cost sharing component to part B:

Deductible – You are responsible for paying an annual deductible of $162 in 2011

Coinsurance – After you have met your annual deductible Medicare part B will pay for 80% of the cost and you will be responsible for 20%

Part C

Medicare part C is also called Medicare Advantage and it is when a private company receives a fee from the Federal government to manage your Part A and B coverage and in some plans your prescriptions coverage as well. Premiums for these plans vary widely, some plans have no premiums and will even reimburse you for your part B premiums directly to your Social Security benefits. Typically these plans will be an HMO with a restricted network of providers but you will always have national emergency coverage. Texans may also see PPO or POS plans with larger networks of providers whether expanded regionally or even nationally. Cost sharing on these plans also vary greatly between plans but will typically have copayments for products and services rather than a deductible. You can enroll in these plan as soon as your eligible for parts A & B but you must have already registered for the part B on your own. Each year during annual enrollment you can re-evaluate your options and change companies without any penalties or medical underwriting.

Part D

Medicare part D is your prescription coverage which is also optional because their is an additional premium but if you don’t sign up when your first become eligible for Medicare you may end up paying more for each year you don’t sign up. These plans are also sold by private companies and differ in price and prescriptions offered. It is important to align yourself with a good agent or do the research to find the best plan for your prescriptions and pharmacies in your area. The plans will typically have copayments or coinsurance for prescriptions until you have reached the infamous coverage gap, at which time you will begin to pay a percentage of the cost instead of copayments until you have spent a total out of pocket of $4,550 in the year 2011. After you have met the out of pocket you will pay a very low copayment or coinsurance

Medicare Supplements (Medigap)

Medicare supplements are standardized plans by the federal government and offered by private companies licensed with the Texas Department of Insurance. They are designed to cover your out of pocket costs of Medicare part A and part B. Each of the 10 plans are labeled with a letter “A” thru “N” and offer different levels of coverage for a premium. Texans can purchase a Medigap policy at any time if you have already enrolled in part A and B. There is no medical underwriting when you first become eligible for Medicare while in the 6 month period around your birthday. If you have delayed enrollment in part B due to existing coverage from an employer, you will have another opportunity to purchase guaranteed issue coverage. At any other time each company will have there own underwriting guidelines that may affect your rate and/or benefits offered.

One of the advantages of Medicare supplement plans are that you have access to all Medicare providers in the country. The only exception is if you purchased a Medicare Select supplement which will restrict you to providers in the insurance companies network for your routing care and a higher cost sharing for care outside the network.