As individuals retire or age into Medicare, their insurance situation can change dramatically. There are a multitude of options open to those with Medicare. The terms are different, the prices are different, the products offered are dramatically different each year.
The purpose of this column is to give those who are eligible for Medicare, or soon to be eligible for Medicare, some understanding of their insurance options and how it could impact their health and finances.
These questions and answers are meant as a guide to help you understand the complex questions you are now thinking about. Each individual's specific situation may create a different solution. You shouldn't necessarily do what your friends, family and neighbors do.
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Janell Sluga
Q: I have Medicare A and B. I have heard the premiums are changing for 2013, but I don't know how much they will be. Can you please clarify this for me?
A: Medicare premiums usually change every year for Part A and Part B. This year the changes are pretty low - much lower than the media frenzy has us expecting.
Social Security also has increased with a 1.7 percent Cost Of Living Adjustment (COLA), so that all of those on Social Security will see an increase in their monthly Social Security benefits.
Now on to the changes for 2013. Most Americans do not pay any premium for Medicare Part A - Hospitalization. Medicare A is free if you or your spouse has worked 40 quarters, or 10 years.
If you do have to pay a premium for Part A, it will cost up to $441 monthly; the 2013 Medicare Part B premium will be $104.90. As I stated, there will be a COLA for Social Security. This means the COLA increase should be larger than the increase to the Medicare Part B premium.
Those who are already enrolled in Medicare Part B and collect Social Security will never see their monthly benefit amount reduced. The laws regarding these benefits include a "Hold Harmless" protection clause. This protection clause dictates that Social Security net benefits cannot go down due to an increase in Medicare Part B premiums.
Some individuals may pay a higher premium for Medicare Part B and Part D; those individuals who make more than $85,000, or couples who make more than $170,000, will pay the higher Medicare Part B premium in 2013. These individuals paid more than others for their Medicare Part B and Part D coverage in the past due to their higher income.
The Medicare deductibles changed as well. The Medicare Part A hospital deductible increased to $1,184 for each hospitalization in 2013. For those individuals who are hospitalized for longer than 60 days, there are additional co-insurance costs. Days 61 to 90 cost $296 per day, and days 91 to 150 cost $592 per day. After 150 days, one would pay all costs. This extended hospital stay rarely happens anymore.
The Medicare Part B Annual Medical Deductible increased to $147. After the deductible, Medicare covers 80 percent of approved charges, and one would pay 20 percent of approved charges.
Most individuals have additional insurance that helps to cover these deductible and co-insurance costs. Many individuals have Medicare Advantage plans, which have an entirely different cost structure for these services.
It is significant to notice that your cost shares have increased very little in 2013. I take that as a sign that health care reform changes are helping to control costs for those individuals with Medicare.
Janell Sluga is a geriatric care manager certified and works for Senior Life Matters, a program of Lutheran Senior Housing, and has worked in Chautauqua County with seniors for more than 18 years. She is HIICAP (Health Insurance Information, Counseling & Assistance Program) counselor-trained by Office for the Aging. She does not sell insurance or represent any insurance company. She is an unbiased source of insurance and education to help seniors choose the best option for them.
You may submit questions to be answered in later columns to Janell Sluga at Senior Life Matters, 737 Falconer St., Jamestown, NY 14701, or call 716-720-9797, or by email at janells@lutheran-jamestown.org.
Please remember that not all questions can be answered in this format, but as many as can be, will be.