Questions and Answers
Section 1: Medicare Legislation
What are Medicare Parts A, B, C, and D?
Medicare Part A typically pays for your inpatient hospital expenses.
Medicare Part B typically covers your outpatient healthcare expenses, including doctor fees.
Medicare Part C also known as Medicare Advantage (formerly Medicare+Choice) offers a choice of options including Medicare managed care plans (like Medicare HMOs and PPOs) and Medicare private fee-for-service plans.
Medicare Part D is the outpatient prescription drug benefit resulting from the Medicare Modernization Act of 2003 that went into effect on January 1, 2006.
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If I take Medicare Part A, B, and choose to enroll in a Medicare prescription drug plan, will I still need Medigap/Medicare supplement insurance?
Yes. Your Medicare supplement plan helps to cover out of pocket expenses not covered by Medicare. Medicare Parts A & B (which cover your inpatient & outpatient medical services) will still have deductibles and coinsurance, which your Medicare supplement plan helps to cover. If you have an AARP Medicare Supplement Plan with prescription drug coverage, you can decide whether to keep the prescription drug coverage with your current plan or choose to enroll in a Medicare prescription drug plan. Please keep in mind that if you choose to enroll in a Medicare prescription drug plan after the close of the open enrollment period, you will be subject to a late enrollment penalty fee (unless you qualify for an exception). If you have a Medicare supplement plan without prescription drug coverage, you will not need to change your Medicare supplement plan coverage, but you will need to decide whether or not you wish to enroll in a Medicare prescription drug plan. A penalty fee may apply if you decide to enroll in a Medicare prescription drug plan after the close of the open enrollment period.
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What if I turn age 65 and it's not during a Medicare prescription drug open enrollment period? Can I choose to enroll in a Medicare prescription drug plan?
Absolutely! When you turn age 65, you are eligible to enroll in the Medicare prescription drug plan as well as an AARP Medicare Supplement Plan without having to answer health questions.
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Does AARP offer a Medicare prescription drug plan?
AARP and UnitedHealth Group have partnered to offer an AARP-branded Medicare prescription drug plan to Medicare beneficiaries called AARP MedicareRx. Information concerning the AARP MedicareRx Plan may be obtained by calling 1-888-867-5564 or visiting www.aarpmedicarerx.com.
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Section 2: Medicare Advantage Plans and Comparisons to Medicare Supplement Insurance Plans
Some Medicare Advantage plans are saying they will no longer charge premiums for their Medicare HMO products. Is the AARP Health Care Options Program looking to eliminate premiums as well?
The changes that began in Medicare in 2004 increased the reimbursements paid to Medicare Advantage programs. The HMOs must use these reimbursements to reduce premiums or increase payments to physicians or otherwise strengthen their networks. It is up to each HMO to determine how to allocate these additional funds.
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Why would I want to consider a Medicare supplement insurance plan over a Medicare Advantage plan?
A Medicare supplement insurance plan offers nationwide access to any physician who accepts Medicare. You don't have to select a primary care physician, so you don't have to worry about going to a doctor "out of the network." You simply seek the care you need.
Because Medicare HMOs and other Medicare-sponsored plans rely on Medicare reimbursements, benefits can change from year to year. Medicare supplement plans can offer greater stability and greater access to providers and facilities. In addition, the benefits of a Medicare supplement plan are standardized and have remained consistent year after year.
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What are the key differences between a Medicare Advantage Plan and my AARP Medicare Supplement Plan?
With a Medicare Advantage plan and other Medicare-sponsored plans, the physicians you choose must be in your network. The benefits those plans pay may vary based on your choices.
With AARP Medicare Supplement insurance coverage, insured by United Health Care Insurance Company (United Health Care Insurance Company of New York for New York residents), you choose your doctor. No paperwork is needed for a referral to a specialist. Nor do you have to wait for approval from the insurance company to begin treatment. Instead, with an AARP Medicare Supplement Plan, you and your doctor decide on the best care for you. AARP has made this coverage available for many years - so stability is assured.
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Why doesn't the AARP Health Care Options Program offer a Medicare Advantage plan?
We continue to examine this opportunity. The AARP Health Care Options Program remains committed to providing nationally based programs that serve all our members. Because a national HMO product does not exist today, it remains a very challenging program to build.
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Section 3: Information specific to Medicare Supplement Planholders
If I enroll in a Medicare prescription drug plan, will I have to cancel my current Medicare supplement plan?
Your Medicare supplement insurance plan provides hospital and medical coverage. Whether you choose to enroll in a Medicare prescription drug plan or not, you'll want to make sure you keep your AARP Medicare Supplement Insurance Plan to help cover those costs.
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How do the Medicare changes affect my AARP Medicare Supplement Insurance Plan with prescription drug benefits?
If you are currently enrolled in an AARP Medicare Supplement plan with prescription drug coverage, you have three options:
- Participate in a Medicare prescription drug plan and keep your current Medicare supplement plan, but the drug benefit will be removed and the premium adjusted.
- Participate in a Medicare prescription drug plan and enroll in another Medicare supplement plan available in your state.
- Keep your existing plan with drug coverage and don't participate in a Medicare prescription drug plan. Please keep in mind that if you choose to enroll in a Medicare prescription drug plan at a later date, you will be subject to a late enrollment penalty fee (unless you qualify for an exception) because you did not sign up for a plan during your initial open enrollment period.
If you currently have a Medicare supplement plan with drug coverage and are considering not enrolling in a Medicare prescription drug plan, be sure to compare the drug coverage between your Medicare supplement and Medicare prescription drug plan to determine which coverage better meets your needs
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What are the options for those enrolled in a pre-standardized AARP Medicare Supplement plan that provides prescription drug benefits and an AARP Medicare Supplement plan in a waiver state that provides prescription drug benefits?
If you are currently enrolled in a pre-standardized AARP Medicare Supplement plan or an AARP Medicare Supplement plan in a waiver state, you have several options:
- Keep your current/existing coverage and not participate in a Medicare prescription drug plan.
- Participate in a Medicare prescription drug plan and keep your current coverage without the prescription benefits.
- Switch to a Medicare Supplement plan A through L if available, and make a decision as to whether to enroll in a Medicare prescription drug plan to cover your prescription drug expenses.
Remember, the Medicare prescription drug plan is not a replacement for your AARP Medicare Supplement insurance coverage. AARP Medicare Supplement Plans provide hospital and medical benefits. Whether you choose to enroll in a Medicare prescription drug plan or not, you'll want to make sure you keep your AARP Medicare Supplement insurance plan to help toward those costs.
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I understand that the Medicare Part B deductible will change annually. Will my plan cover this change?
For 2006, the Medicare Part B deductible increased from $110 to $119. It is expected that the Medicare Part B deductible will change annually. If your plan currently covers the deductible, then yes your AARP Medicare Supplement Plan will continue to cover the Medicare Part B deductible. If your plan does not currently cover the deductible, then it will not cover the deductible going forward.
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Will I still need a prescription discount card (Prescription Savings Services card or MembeRx Choice card) if I enroll in a Medicare prescription drug plan?
If you enroll in a Medicare prescription drug plan, you could use a prescription discount card (Prescription Savings Services card or MembeRx Choice card) to receive discounts on prescription drugs that are not covered by your plan.
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More Information
Where can I get more information on AARP?
If you would like more information on AARP, visit www.aarp.org or call 1-888-OUR-AARP (1-888-687-2277).
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MMA005 06/06
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