Conversations With Carol #7
Medicare and HMO Alert
By Carol Abaya, M.A.

For more than a decade I have been involved with aging issues and elder/parent care.  Change is the name of the game.

The biggest - and still developing - changes involve health care in general and Medicare more specifically.  There is a lot of information ‘out there.’   Sometimes it can get very confusing.  What is important   is how these changes impact you or one of your family members.

This is Carol Abaya.

Every day I learn something new.  I thought I knew quite a bit about Medicare and what it’s all about. 

But last year, as a dear friend of mine lay dying in the hospital, I got a hysterical call at 11:30 P.M. from her daughter.  "I’m getting all kinds of bills from the hospital.  A couple hundred thousand dollars worth."  She could hardly talk.  "What do I do?"

"Medicare should be paying," I said.

My friend, at that point had been in the hospital for almost 10 months.  I knew she had supplemental insurance.  So I was as surprised as her daughter.

"Let me check my files," I told her, "and I’ll get back to you."

What I learned after going through the Medicare handbook line by line surprised me.

So, our visit today will focus on Medicare - maybe not such a pleasant subject because, after all, who wants to get sick?  But it’s inevitable.  Sooner or later everyone  needs a doctor - or doctors, plural - or the hospital.  Medicare is a great program,   but it does have its limits, and HMOs have further limitations.

Rather than keep you in suspense about what I learned that night, I’ll tell you now.  Then I’ll go into more detail about Medicare - what it is, and what it pays for.

Medicare only pays for a maximum of 150 days in the hospital - per benefit period.  After that you’re completely on your own!  You do have 60 reserve days that can be used in addition to the base 150 days.  But you can only use these days once in your lifetime.

My friend had been in the hospital for many more days.  And the bills, still outstanding and in negotiation, amount to almost $350,000.

There may be a way of "extending" those 150 days, by using nursing home and hospice benefits.  However, this seems possible only if you know about the 150 day limit and how to maneuver these other benefits.  .

Let’s get to basics.

Medicare covers both hospital care (Part A) and physician care (Part B).  If you are 65 and receiving social security, you receive Part A benefits at no cost to you.  However, you need to register for Medicare Part A about 6 months before your 65th birthday.   

If you want Part B, you also must sign up for it and this year (2000) $45.50 will be deducted from your social security check.

Enrollment Period: 

You must enroll in both Part A and Part B.  If you don’t enroll in Part B, prior to turning 65, then you can only enroll between January 1st and March 31st of each year, with benefits effective July 1.  The monthly premium will be higher if you wait  before signing up.

Deductible: 

If you are in the hospital, you pay the first $776 (2000) of the bill, per benefit period. Medicare then pays all the bills for the first 60 days only.

What most people don’t know -- and why families can get bills for thousands of dollars -- is that the patient pays a co-insurance amount of $194 (2000) per day for days 61 through 90, and $388 (2000) per day for days 91 to 150.

Most people do not know about this limitation, and think that Medicare will pay all the hospital bills.

In reference to Part B, you pay the first $100 of doctors’ bills, and then 20% of the rest of the bills per calendar year.

Benefit Period: 

A Benefit Period  for Part A starts the day you are admitted into a hospital and ends when you haven’t received inpatient hospital or skilled nursing care for 60 consecutive days.

This means you have to be out of the hospital or nursing home and at home for 60 days before you can start a new benefit period, as I described earlier.

Doctor Co-Pay: 

Most people know that they have to pay 20% of doctors’ bills, in what is called a co-insurance payment or co-pay.  What many don’t know is that a doctor who accepts Medicare can only charge 15% more than what Medicare approves for that particular service or medical procedure.  If he charges more, you don’t have to pay.

This is why when a Medicare patient goes to the doctor, he or she should not pay anything at the time of the visit.  While many offices have signs saying you have to pay the co-insurance at that time, this just isn’t true.  Don’t bring a check book with you!  Don’t let a clerk intimidate you.  Wait until you get the Medicare statement and see the amount Medicare has approved.  Don’t pay more than 15% more than the amount approved by Medicare!  Too often, doctors’ bills are  higher than the legal amount allowed. 

We’ve already talked about hospital bills, the number of days covered and the amounts you have to pay.  Medicare pays for a semiprivate room, meals, general nursing care and other hospital services and supplies (but not private duty nursing, a television or telephone in your room, or a private room,   unless medically necessary).

Medicare will pay for all the costs of a nursing home for the first 20 days.  For days 21 to 100, the patient pays $97 (2000) a day; and for the total cost after day 101.  Included are a semiprivate room, meals, skilled nursing and rehabilitative services, and other services and supplies.

Remember, if you go into a nursing home under Medicare, it must be Medicare certified.  The home cannot ask for a deposit or other payment as an admission requirement.  It’s illegal for them to ask you to pay anything up front.  Some nursing homes still try to get some payment up front.  It’s a federal offense.

Medicare will pay for intermittent skilled nursing care, physical and speech therapy, pathology services, home health aide services, durable medical equipment, supplies  and other  services.  You pay nothing for Home Health Care services,  and 20% of the approved amount for durable medical equipment .

For terminal illness, if the patient is expected to live less than 6 months, Medicare will pay for care in a hospice certified facility.  A certain amount of home care is also provided.

In order to make an informed decision, you need to have all the facts -- about the traditional payment program and HMOs.

The traditional Medicare program still provides the most comprehensive and flexible medical treatment. 

 As a fee-for-service program, it  has virtually no restrictions on your choice of doctors or hospitals, access to specialists, procedures or diagnostic tests as long as the provider is Medicare-approved and the services are covered by Medicare.

You will receive treatment according to your doctors’ recommendations -- and no one else will refuse you treatment.  You won’t be refused an operation, for example, based on your age or referral to a specialist.

Also, very important is the fact that you will be covered by Medicare for hospital and doctors bills wherever you are in the United States.  Whether you winter part of the year in another part of the country, are away for just a weekend, or are on vacation,  traditional Medicare pays the bills as if you were at home.

Medicare itself recommends that if you are happy with the way you get health care now, you shouldn’t do anything.  If you do nothing, you will continue to receive your Medicare health care in the same way you always have.

Now let’s take a look at HMOs in general.  Proponents point out that HMOs do a risk evaluation when someone joins and are therefore better able to identify problems or potential serious illnesses early on.  Earlier intervention may help reduce costs over time because crises may be avoided.

Those who favor HMOs over the traditional Medicare program say HMOs