Q&A: #110

Medicare and HMO’s
By Carol Abaya, M.A.

Question:  Both my husband and I (69 and 66) and my father (90) have been receiving lots of information in the mail about Medicare + Choice and Medicare HMO’s.  There is so much material with different recommendations that we’re confused.  What is the best program?

Answer:  You can participate in the traditional Medicare program or receive medical care through an HMO.  There are key differences.

Traditional Medicare allows you the most flexibility, choice of doctors and treatment.  You and your doctor make the important decisions, and you receive treatment accordingly.  If Medicare, for some reason, refuses to pay for the treatment, the denial comes after you have already received the care.  You can then appeal. This plan pays part of the cost of medical services and you pay for the annual deductible and 20% copayment.

Medicare HMOs usually offer a broader package of services (medicine, eyeglasses, hearing aids) than traditional Medicare.  The amount you have to pay out-of-pocket is less.

However, a strong warning.  HMO’s place a layer of cost-conscious administration (and strangers) between you and your doctors.

First, your choice of doctors is limited, as the doctor must be “in the HMO system.”  An Arizona doctor told me one of his long time elderly patients was forced to change doctors because he was no longer in that HMO system.

Second, your doctor’s recommendation for treatment can be denied by the HMO before the treatment is provided.  There have been cases where the patient died before the appeal process was completed.

The HMO has the ability to refuse to allow you to be treated at a critical time.  Always remember that in all managed care programs there is an administrative level (which is difficult to “control”) which may come between you and your doctor and optimal treatment.

You do not have to change from the traditional fee for service Medicare program.  This in the long run gives you the most flexibility and choices.

If you are happy with the way you now get your health care, you shouldn’t do anything.  What sounds too good to be true (new plans), often is.

Question:  My mother’s doctor is trying to get her to sign a contract with him and to charge her higher rates.  Can he do this?

Answer:  Yes.  You can enter into a private contract with any doctor (or other provider) for  treatment any time you want.  But then the doctor can’t treat any Medicare patients and receive payment from Medicare for 24 months.

If you sign a contract, the doctor is free to charge private rates for the treatment.  You pay the whole bill.  Medicare will not pay, even if a claim is submitted.  You may not use your medigap supplemental insurance, or any other insurance, to help cover the costs.  This process applies to Medicare - approved treatment only.  Physicians and providers who accept payment for Medicare services cannot enter into private agreements with patients for treatments covered by Medicare.      

However, if your doctor recommends a new treatment or medical procedure not approved by Medicare, you can agree to pay the total cost yourself.  The doctor will still be able to treat other Medicare patients and receive payment. Physicians can only be paid privately by patients for treatments and services not covered by Medicare.  In these cases, neither the physician nor patient is penalized by Medicare.

With the traditional Medicare plan (fee for services) doctors can  “accept assignment” and  they are paid the amount approved by Medicare. Medicare bases its payments on what it feels is customary and reasonable in that part of the country.  If the doctor does not accept assignment  he can only charge 15% more than what Medicare approves.  This limitation on charges protects seniors from doctors seeking to make more money and take advantage of those who do not know their rights.

Question:  My parents’ doctor told them that Medicare will pay for various tests to see if they have cancer or osteoporosis.  My company HMO told me that isn’t true.  Who is right?

Answer:  Your parents’ doctor!   Regardless of whether your parents are in the traditional Medicare program or in an HMO, they are  entitled to various preventive treatments and tests, including:

  • flu shot, once a year
  • pneumonia shot, one time
  • mammogram, one annually
  • pap smear and pelvic exam, once every three years, unless high risk
  • colorectal cancer, various tests depending on risk level
  • diabetes monitoring, in doctor’s office and now at home
  • bone mass density, depends on health and risk

Question:  My parents spend three winter months in Arizona.  They are thinking about switching to an HMO because of the medicines they both have to take and which are paid for by the HMO.  Should they switch?

Answer:  No!  HMOs only provide for and pay for medical services in a limited geographic area.  If one of your parents get ill in Arizona, who will he or she go to?

The HMO will not pay the bills.  Under the traditional Medicare program, medical bills will be paid regardless of where the treatment in provided across the USA.

Question:  My parents (73 and 78) have very limited income and the amount deducted for Medicare from their social security checks each month could be used for food.  Is there some way that they can get the medical insurance coverage, but not pay?

Answer:  Yes, provided they meet certain low income and asset requirements.

Medicare Part A pays for hospital care and is not paid for separately.  It’s an integral part of social security.

The cost of Part B (medical-doctors-insurance) is dedicated from the amount your parents receive.

There are three programs that will pay for Part B, with certain conditions having to be met.  (1) Medicaid; (2) the “Qualified Medicare Beneficiary” (QMB) program; (3) “Specified Low-Income Medicare Beneficiary (SLMB) program.  QMB and SLMB are federal and run by Health Care Financing Administration.  Medicaid is state operated.

Contact your state local medical assistance agency, social service office or welfare office for all three programs.

Question:  My parents (68 and 70) are planning a trip to the Caribbean, for the holidays.  We have been told that Medicare will not pay for medical or hospital expenses if they get sick.  Why not?  After all, they pay for it from their social security.

Answer:  Traditional Medicare (as opposed to HMOs) will pay for doctors and hospital bills anywhere in the U.S.A.  Most HMOs won’t even pay that.  If someone goes on a trip outside the HMO coverage area, they end up paying the bills.

While Medicare won’t pay for out-of-country medical bills, there is travel medical insurance available for a nominal fee.  There is also insurance that will reimburse a person for deposit and other payments made if he/she gets sick and can’t make the trip.  Travel agents have application forms and are generally very helpful.

Question:  I am 72, live alone and need an operation on my leg.  The hospital says I have to leave after 48 hours.  But I won’t be able to walk freely and have no one to help me.  The doctor is advising a nursing home.  I don’t want to go into a nursing home and don’t have money to pay for one.  What are my options?

Answer: When your doctor suggests a nursing home, he really is suggesting a rehab nursing home where you can get both the medical help you need to recover and physical therapy so you can return to and remain independent in your own home.

Medicare will pay all the nursing home costs for up to 20 days.  Then Medicare will pay part of the bill through the 100th day.

Once home, Medicare may also pay for a visiting nurse (up to 100 visits) to check your progress, bandages, etc.

So, take advantage of what Medicare will pay.

Medicare, however, will not pay for custodial nursing or home care services.

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