Posts Tagged: Medicare

What will Happen to Health Benefits for Same Sex Couples without DOMA?

Last week, the Supreme Court ruled that the Defense of Marriage Act, DOMA is unconstitutional, and same sex couples should be afforded the same health benefits as any other married couple.

That means a lot of changes (and potential savings) are on the way for same sex couples. One study by the Center for American Progress and the Williams Institute in 2007 estimated that the average married same-sex couple paid over $1,000 more in taxes each year.

Not only will the government begin allowing its own employees to enroll their partners in the Federal Employees Health Benefits Plan, but couples all over the country will face a new set of rules–that may or may not end up being a good deal.

Some of the immediate benefits:

Tax-free health benefits
Money paid towards employer-sponsored health insurance is all pre-tax. Yet for same sex couples, the money spent on the employee’s partner would be counted as income and subject to income taxes. This could add up to thousands of dollars of taxable income over a year.

Special enrollment rights
Opposite sex couples have always been able to add their spouse to their health plan right away if the partner left their job, lost their own benefits, the couple was newly married, or they adopted a child. These are benefits under the federal regulations HIPAA. But same sex couples would have to wait until the plan’s annual open enrollment, if they were eligible at all.

Access to Medicare, Medicaid, & Tricare
Same sex couples have always been denied coverage for Medicare and Medicaid through their partner, the federal safety-net health benefits for the elderly, disabled, and low-income. They also could not get coverage under their partner’s Tricare benefits, the government’s insurance for military personnel. Now, all of these benefits will be available with the same eligibility criteria as opposite sex couples.

Shared HSA, FSA, and HRA spending
Previously, if one member of a same sex couple had any kind of health savings account or flexible spending account, the funds couldn’t necessarily be spent on their partner’s medical expenses. The partner would have to be an IRS designated tax dependent to be able to use the funds.

But there are also some possible disadvantages:

Insurance Exchange subsidies
Under the federal health insurance exchanges, set to open January 1, 2014, some couples may no longer be eligible for subsidies and tax credits that they could have gotten individually. For example, if each person had an annual income of $35,000, they would each qualify for a federal subsidy on their insurance premiums, separately. But with a combined income of $70,000 they now earn too much money to qualify for a subsidy.

Medicaid Eligibility
In the same way, the combining of family income to determine eligibility could also disqualify some couples for Medicaid (ironically, since now same sex couples just gained access to Medicaid via their spouse). So at the end of the day, it’s couples who have similar and relatively low income who might lose out.

But all told, there is a lot yet to be determined as states and the federal government iron out policies and procedures, especially, with gay-marriage laws still differing by the state. With thousands of pages of regulations related to marriage and health benefits, it could take awhile for regulators to figure everything out.


5 Ways You Could Benefit from the Health Insurance Exchanges

The news is everywhere about the insurance exchanges! With all the hype, what should you know? And should you care?

With over 10 million people expected to be eligible for the exchanges, there’s actually a good chance that you should care… The exchanges will be online marketplace where individuals or employees of small businesses can go to compare and buy health insurance. Enrollment starts October 2013 and the plans go live January 2014.

And you’ll most likely benefit the most from them if…

1. You’re uninsured

If you’re shopping for insurance on a federal or state exchange, you can’t be denied health insurance because of your medical history. The plans are guaranteed issue for anyone (as long as you’re a US citizen or legal US resident). You’ll also be protected from the plan suddenly canceling the plan on you if they discover anything about your health history later on.

2. You’re currently paying a ton for your health care

If you’re insured but sinking half your paycheck into your health insurance, the good news is that pricing rules on the exchanges will keep premiums in check. There are only a few ways premiums will be allowed to vary:

  • Overall: the most expensive plan can only be 4.5 times the cost of the least pricey plan
  • By age: the price for older members can only be three times that of younger members
  • By geography
  • By family size

Sliding scale subsidies will also be available depending on your income. And they’re pretty generous: You’ll qualify if your income is up to four times the poverty line (about $45,000 for an individual). And the average annual subsidy is expected to be $4,600 in 2014.

3. You’re older but not old enough for Medicare

Both guaranteed issue and the premium pricing rules work out really well for you if you are older but haven’t quite reached 65. This is typically the most difficult age group to be in for finding affordable insurance. Health plans on the exchanges will have to sell you coverage and it can only be three times the price for younger members (today, that ratio is much more extreme).

4. You have really high medical costs

Starting in 2014, annual and lifetime limits on coverage will no longer be allowed by any health plan. Right now, it’s easy to reach one of these limits if you have ongoing health issues, which leaves you without coverage exactly when you need it. But plans will soon be banned from setting any of these limits.

5. You get confused comparing health plans

All plans sold on the exchanges will be standardized, with the goal of making them easy to compare. There will be four tiers of plans, with Bronze plans being the most basic, and Platinum the most comprehensive (and Silver and Gold in between). And all plans will have to cover a list of Essential Health Benefits so there should be no big surprises about what’s covered and what’s not.


Costly Medicare Mistakes to Avoid if you’re Still Working

Age 65 is kind of a magic time where the health insurance world changes. But many people are continuing to work beyond 65 these days. What should you do when you become eligible for Medicare but you’re still covered by your employer’s health insurance?

 Avoid these common mistakes that can lead to higher premiums, penalties, or missed enrollment opportunities.

1)   Paying for Part B when you don’t need it

While Medicare Part A is free if you have been working in the U.S. for most of your life, Part B comes for a monthly premium (in 2012 it was $99 for most people). If you have health insurance through your employer, you’re allowed to defer Part B. Otherwise, there is a late enrollment penalty (10% of the premium for each year you didn’t have Part B). Contact Social Security to delay Part B but remember to sign up as soon as you retire or you could be hit with the penalty.

2)   Using your Medicare first

As long as you’re working and covered by your employer’s plan (or your spouse’s plan), Medicare considers that coverage to be your primary insurance.* That means Medicare won’t pay for anything that your primary plan doesn’t cover. They’ll only pay a portion of the bill after the primary plan pays a portion (yes, odd Medicare rules, right?).

So let’s say your employee plan is an HMO, and you go outside your physician network. Don’t expect Medicare to cover anything. However, if you do go to a network doctor, your primary insurance will pay first, and then Medicare will pay a portion, up to the Medicare benefit level. Bottom line? The two sources of coverage aren’t interchangeable. Rely on your employer insurance, and think of Medicare as a bonus, not an alternative.

3)   Not Getting Part D when you should

A lot of people put off enrolling in Part D when they have prescription drug coverage through their employer. And that’s usually just fine. You’ll run into trouble however, if your drug plan is not considered “creditable coverage.” That means Medicare has decided the plan meets certain standards of being equivalent to a Medicare Part D plan. Most employer plans are creditable, but you should still check with your HR department. If your plan isn’t creditable, you’ll end up paying a late enrollment fee  for every month you didn’t have Part D as long as you have Medicare.

You’ve probably noticed by now that Medicare is pretty strict when it comes to how employer health insurance coordinates. And that means little forgiveness if you don’t follow the rules. Questions? Contact Medicare Coordination of Benefits.

Or need more individualized help with Medicare?  SHIP, the State Health Insurance Assistance Program, is a federal program that provides free one-on-one Medicare assistance. Search for the one in your area through Medicare.


* If you work for a small employer (20 or fewer employees), the rules are a bit different for you. Medicare is always your primary insurance!


Essential Tips for Medicare Open Enrollment

Usually, it’s the same with Medicare every year: mid-November through the end of the year is the time to change plans (either health plans or drug plans). Not so anymore! This is just one of many changes rolling out this year. For the savvy Medicare consumer, here are the best tips (old and new) for finding the right plan.

The first should no longer be a secret: starting this year, Open Enrollment moves up—to October 15th – December 7th.  This is your chance to switch to a different Medicare Advantage Plan or Part D drug plan. If you miss it, you can still drop your health plan during the Medicare Advantage Disenrollment Period (MADP) which occurs January 1st – February 14th. You won’t be able to choose a new one, but you can enroll in a new Part D plan so you at least have drug coverage. And you will be responsible for all of Medicare’s deductibles and co-pays (20% of all outpatient) if you don’t have other supplemental coverage. You cannot drop a stand-alone Part D plan during the MADP though—only a Medicare Advantage health plan.

Second: Keep your eye out for Five-Star plans. Medicare rates all Medicare Advantage and Part D plans with star ratings based on quality and cost. Beginning in 2012, consumers will be able to switch to plans with a five star rating at any time of the year. So let’s say you missed Open Enrollment or are unhappy with your plan; this new rule allows you to find a Five-Star plan and switch.  But don’t get your hopes up—in 2011 there were only seven five star plans in the entire nation.

Third: If your Medicare plan is discontinuing next year, you have a chance to get a Medigap. Normally, Medigap (Medicare Supplement) plans can look at your health history and deny you coverage unless you apply when you first get Medicare. But if your Medicare Advantage plan is leaving the market, you have a special right to buy a Medigap plan with guaranteed issue. The law gives you 63 days from when your plan ends so don’t wait.

Fourth: If you’re concerned about the cost of your prescription drugs, Medicare has an amazingly thorough tool to allow you to compare drug plans at You can enter the names and doses for all your medications and see exactly how much each costs under every plan. Also be ready for  bigger savings in the donut hole: The discount increases to 50% off brand name drugs and 14% off generics.

Finally, if you want detailed, individual help with your Medicare, take advantage of SHIP. Every state has this program to provide face-to-face assistance to anyone with Medicare (or their caregiver or representative). The State Health Insurance Assistance Program (SHIP) is unbiased, free of cost, and has counselors knowledgeable about plans in your local area. So who wouldn’t want the chance to sit down with an expert to ask anything you want about Medicare? Find your program.


The Patient Protection and Affordable Care Act and What it Means for Consumers

By now you have probably already heard more than you wish to digest about the Patient Protection and Affordable Care Act (ACA). Regardless of whether or not you are a supporter or an opponent of the new law, implementation of provisions that will affect you and your family is already underway, and it is important for consumers, like you and me, to know how and when we will be affected.

The ACA means so many different things for providers, the insurance industry and regulators, but what does it mean for you and me, the consumers? I will spare you the nitty gritty details of every single provision in the health care law, and perhaps we can start with the top ten provisions that I think consumers should be aware of.

1. Coverage cannot be denied to individuals with pre-existing conditions. I have heard horror stories from consumers who were denied health coverage because they were diagnosed with acid reflux disease or had freckles or even because they were pregnant. Under the ACA, insurance companies will no longer be able to refuse coverage to individuals with pre-existing medical conditions. Although this provision doesn’t kick in for adults older than 19 until 2014, insurance companies are prohibited from limiting or denying coverage to children with pre-existing conditions as of 2010. In the meantime, the law establishes funding for a temporary subsidized high-risk pool that provides coverage for uninsured adults with pre-existing conditions until health insurance exchanges are created in 2014.

 2. Free preventive care. We all love freebies, and under the ACA, those of us with new policies will be receiving a major one. Effective as of 2010, new health policies from private plans must offer preventive care such as mammograms, colonoscopies, vaccinations and preventive screenings for free. So that means no co-pays, no deductibles and no coinsurance for these services.

3. Coverage cannot be rescinded. In addition to hearing countless horror stories about consumers being denied coverage due to pre-existing conditions, I have also heard stories that are just as horrific about consumers being dropped from their coverage once they become sick. Effective already is the provision that prohibits insurance companies from retroactively canceling consumers’ insurance coverage unless they can provide proof that the consumer intentionally committed an act of fraud. Of course, determining intent can be very subjective, especially if the insurance company is making that decision. Fortunately, for consumers, the ACA also creates new review boards that decide objectively what constitutes fraud.

4. Restrictions on imposing limits on insurance coverage. Some of us have insurance plans that include something like a $100,000 limit on coverage. That sounds great, right? Wrong! Anyone who has been diagnosed with a serious condition or who has experienced a medical emergency knows that $100,000 in health expenses can disappear very quickly, and once you have reached that limit, you are on your own and out of luck. Currently, under the new law, insurance companies are restricted from imposing lifetime dollar limits on coverage, and by 2014, they will be restricted from imposing annual limits on coverage.

5. Consumers will have more options to appeal coverage decisions. Many consumers have had to deal with the headache of receiving a letter stating that their insurance provider has denied their claims and in addition, they will not be able to appeal the decision. The new law ensures that consumers have access to an effective internal and external appeals process. In other words, consumers have the right to demand that their insurance provider reconsider a decision to deny payment for a medical procedure. Additionally, consumers can also make an external appeal to an independent reviewer.

5. Medicare beneficiaries can say goodbye to the “donut hole.” If you are a senior or if you have older family members or friends, then you are probably familiar with the Medicare “donut hole.” The “donut hole” represents the gap in prescription drug coverage that Medicare Part D beneficiaries have to account for. To clarify,  once a Medicare beneficiary reaches around $2,250, in prescription drug benefits, then he or she will be responsible for paying the next $2,250 toward prescription drugs before Medicare coverage kicks back in. For some seniors who are already on fixed incomes, this means, cutting pills in half or deciding not to take medications altogether. Beginning in 2010, Medicare beneficiaries who hit the “donut hole” will receive a $250 rebate. Each year, that rebate will get larger until the “donut hole” is closed completely by 2020.

6. Consumers will be provided with tools to understand their health plans. Navigating insurance plans can be incredibly confusing and discouraging, especially when insurance companies fail to disclose information that can be important and helpful for consumers. When consumers do not understand what their plans include or what they are purchasing, they can be vulnerable to falling into medical debt. The ACA provides funding to states to establish or expand offices of health insurance consumer assistance in order to help individuals file complaints and appeals and understand their benefit packages. In addition, insurance companies will be required to publicly post consumer health insurance information.  

7. Insurance companies will be prohibited from issuing unreasonable rate hikes. In 2010, insurance company rate hikes caught the media’s attention. Consumers were receiving notices informing them that their rates would be increased by up to 33% and that insurance companies have the right to issue rate increases more than once a year. Consumers were outraged, especially when insurance companies were unable to justify the rate hikes. The ACA creates a grant program to support states in requiring health insurance companies to submit justification for all requested premium increases.

8.  Young adults can stay on their parents’ plan until age 26. Although some young adults are fortunate enough to land a job that offers them good health benefits right out of high school or college, the reality is that the majority of young adults are not this fortunate and have difficulty purchasing expensive private insurance plans on their own. Under the ACA, parents have to option to add or keep their children on their health policy until they turn 26, even if their child is not claimed as a dependent, lives in another state or has a full-time job.

9. No more penalties for using out-of-network emergency rooms. When you are suffering from a medical emergency, the last thing you want to be doing is worrying about whether or not your health plan will cover the emergency room services you are receiving. New health plans will be prohibited from requiring consumers to get prior authorization before seeking emergency room services from a provider or hospital outside a plan’s network. In addition, they will also be prohibited from requiring higher co-pays and co-insurance for these services.

10. The individual mandate. Most consumers are aware that by 2014, they will be required to have health insurance coverage. Without the individual mandate, the health reform law would not have been as viable.  Younger, healthier individuals might opt out of coverage and the insurance pools would be disproportionately utilized by people who are older and sicker. As a result, premiums would be raised for everyone. Furthermore, because insurance companies are no longer allowed to deny coverage due to pre-existing conditions, the individuals who initially opted out of coverage can opt back in once they get sick. The mandate ensures shared responsibility among consumers. The ACA also includes subsidies for purchasing insurance for consumers who qualify and exemptions for reasons such as financial hardship, religious objection and immigrant status.

What we covered here is just the tip of the iceberg when it comes to the ACA, but hopefully this will serve as a starting point in understanding how you, the consumer, could be impacted by health reform. For more details about health reform and what it means for you, a good site to start with is