Archbishop's web site Denver Catholic Register Parishes Catholic Pastoral Center
September 11, 2002
Retirement brings important questions about health insurance
Medicare federal health insurance program offers multitude of options
By Nancy Frazier O'Brien
(CNS) — As you prepare to retire, your thoughts might be on how to invest your pension funds, what Social Security benefits you will be receiving or even where to buy the best fishing bait. But don't forget one important matter — signing up for Medicare.
Medicare, the federal program that provides health insurance for most seniors, covers some — but not all — health care costs. Excluded from Medicare, for example, are most prescription drug costs and 20 percent of the charges for visits to doctors.
Although enrollment in Medicare usually is done automatically when a person signs up for Social Security, there are still several crucial decisions to be made. The initial enrollment package sent out to each new Medicare enrollee along with his or her red, white and blue Medicare card outlines the choices:
•Do you want Medicare Part B? While the hospital insurance provided by Medicare (Part A) is free for most retirees and their spouses, the medical insurance (Part B) requires payment of a monthly premium — $54 a month in 2002. Those aged 65 or older can delay paying for Medicare Part B if they have other health insurance through a spouse's employment or their own.
But if you delay taking Part B and do not have other health insurance, your premium will increase by 10 percent for each 12 months that you could have had Part B but did not take it. To avoid the penalty, you must sign up for Part B within eight months after employment ends or the group health coverage ends, whichever comes first.
If you decide to take Medicare Part B as soon as you are eligible, the monthly premiums will be deducted from your Social Security payments each month.
•Which coverage option do you want? The choices vary from region to region, but may include Medicare managed care plans, such as health maintenance organizations, preferred-provider organizations or provider-sponsored organizations. In addition, private fee-for-service plans and Medicare medical-savings account plans may be available.
For a current list of the Medicare health care choices that are available in your area, call 800-633-4227.
No matter which plan you choose, you will still be in the Medicare program. Each plan must provide at least the basic Medicare-covered services, including inpatient hospital care, skilled nursing or rehabilitation services after a hospital stay, certain home health care services, and 80 percent of the costs of doctor services, outpatient hospital services, ambulance transportation, diagnostic tests, laboratory services, some preventive care, outpatient therapy services, and durable medical equipment and supplies.
Medicare Part B usually does not pay for most prescription drugs, routine physical examinations or services not related to treatment of illness or injury. It also does not pay for dental care or dentures, cosmetic surgery, routine foot care, hearing aids, eye examinations or eyeglasses.
There is also a $100 annual deductible for Part B and a hospital deductible ($812 in 2002 for each benefit period). A benefit period begins on the first day you receive services as a patient at a hospital or skilled nursing facility and ends after you have been out of the hospital or skilled nursing facility and have not received skilled care in any other facility for 60 days in a row. There is no limit to the number of benefit periods you can have.
•Do you need supplemental Medicare insurance, also known as Medigap? These policies are sold by private companies, which are required by law to offer up to 10 choices labeled A through J that provide different levels of benefits. This gives seniors an easy way to compare plans, since the "G" plan offered by one company, for example, must provide exactly the same benefits as another company's "G" plan, even thought the price may differ.
Each supplemental plan is required by law to provide certain core benefits — Part A copayment coverage for 365 additional hospital days once Part A coverage ends, the 20 percent copayment for Part B, and the first three pints of blood used each year.
At the H, I and J levels, prescription drug coverage is included. The supplemental plans can cost from $50 to $280 per month in 2002, depending on the coverage level.
Contact Us
