Understanding Arizona Medicare Supplemental Insurance

Medicare is a federal health insurance program for people 65 years of age or older. It pays for much of a participant’s health care, but not all of it. Some costs not covered are, prescription drugs, deductibles, and the 20% coinsurance. Medicare Supplements and Medicare Advantage plans are health insurance policies sold by private heath insurance companies that are designed to fill in the gaps in Medicare coverage. The key to understanding Arizona Medicare supplement insurance coverage is to realize that there are only two basic choices, select either a Medicare Supplement policy or a Medicare Advantage plan. Both accomplish filling in the gabs differently.

There was a time not too many years ago, when Medicare supplements were the only choice for Medicare recipients. A good Medicare supplement gives a policy holder the most access to health care nationwide. With a Medicare supplement you can go to any doctor or health care facility in the nation that is willing to accept Medicare billing. This is very helpful to snowbirds and those who travel extensively for months at a time. These insurance policies are guaranteed renewable for life. During a Medicare participant’s open enrollment period they can elect to participate in any Medicare Supplement policy with any insurance carrier without having to provide proof of insurability. The open enrollment period is the three months before and the three months after their Medicare Part B start date. After this time period switching carriers often requires proof of insurability. If a Medicare participant elects to go with a Medicare supplement policy they will be required to buy a Medicare Part D policy to cover their prescription drug cost. There are fourteen different standardized Medicare Supplement plans to choose from. Each provider’s plans are identical so unlike the MA plans shopping for these are much easier. Medicare supplement policies all come with a monthly premium. Costs will vary from company to company. However, each company’s plans are all exactly the same. With all that parody in these insurance plans what should a Medicare recipient be looking for?

Seniors should be looking for companies with:

• A track record of verifiable financial stability
• Excellent customer and bill paying services
• A history of consistent premium costs free of huge increases

This important information is not readily available to consumers.

Of the 14 standardized Medicare supplement plans only two should be considered by most Medicare recipients – plan F and plan G. Plan is F is the most popular because it guaranties to cover a person up to the maximum allowed by Medicare for any Medicare approved service. This leaves little to chance and a policy holder will know that they should never receive a bill unless they have had a non-Medicare approved service or procedure. An example would be a face lift. Plan G is a little different in that it will not pay for any excess charges allowed by Medicare. A person with plan G must be vigilant that their providers will accept Medicare assignment. That is why consulting with an independent agent is a good starting point in finding the best Arizona Medicare supplement policy.

Over the past few years Medicare Advantage (also called MA) plans have become very popular in Arizona because the premiums are very low or nothing at all. There are three distinct types of MA plans; HMO, PPO and PFFS. Arizona Medicare Advantage Plans are annually renewable contracts between you and the insurance company. Unlike Medicare Supplements, your enrollment can never be turned down for coverage due to any preexisting health conditions. Many companies that offer these MA plans even have special need plans for those with chronic conditions, to further help them with their medical costs. Another nice feature of the MA plan is that they are available with a prescription drug plan at no additional cost. These types of plans are often referred to as MAPD plans.

Medicare Advantage plans are heavily advertised by the insurance companies during the two open enrollment periods AEP and OEP. AEP is the annual enrolment period currently starting from November 15th and runs through December 31st each year. During this time period Medicare recipients can freely switch from one MA and or PD plan to another with a policy start date of January 1st. OEP is the open enrollment period and runs from January 1st through March 31st of each year. During this time period Medicare recipients can once again change plans and providers with one limitation they can not add a drug plan if they do not already have one.

HMO's are health maintenance organizations. Like many health plans in Arizona you are limited to the contracted health care providers and facilities the company has in their directory. These plans provide for limited or no coverage outside of the company directory unless you have an emergency that requires immediate hospitalization. These types of plans require that you designate a primary care physician or (PCP) who is contracted with the company. They are your single source for health care with a few exceptions, such as urgent care and emergency care. If you need a specialist or surgery they will be the ones to refer you to other providers within the organization. One of the reasons many people who choose this type of plan enjoy it (besides the good service they receive) is the cost. Currently, the monthly premium for an MAPD in Maricopa County Arizona is zero.

PPO's are preferred provider organizations. They are similar to the HMO style plan except that you have the freedom to choose any health care provider, service or facility within the directory without a referral from a PCP. Many insurance companies offer both HMO and PPO style plans to their Medicare Advantage members. Though the freedom of a PPO comes with the extra expense of a monthly premium, it is an excellent choice for those who want the freedom to pick and choose without having to be referred by a PCP. These plans will also save you on your monthly premium compared to a traditional Medicare Supplement. Like the HMO plan Part D is included for no additional expense. The PPO plan is a very good fit for Arizonans who live in multiple covered counties at different times of the year.

PFF's are Private Fee for Service Plans. This type of MA plan has only one major limitation. The provider you use for services must be willing to accept the insurance companies’ payment for services performed. If your provider is willing to accept the terms and conditions of the PFFS insurance carrier you are only responsible to pay the co- pays as described in the plan’s summary of benefits.

In 2005 Medicare Part D was introduced to help Medicare recipients with the cost of their prescription drugs. Like the MA plans Part D is an annually renewable contract and all plans are not created equal. So it is important to have your plan tailored to your prescription needs so that you get the maximum saving on an annual basis.
Medicare is constantly changing from year to year and keeping up with those changes is often a daunting task. I highly recommend the use of an experienced insurance agent when looking to buy or change plans.

As an independent agent I represent my clients so I offer many different Medicare plan options from many different providers. With thorough explanations of your choices, rights and options I allow my clients to choose the one that will best help them meet their individual needs and budget. To contact me you can call me at (602) 502-3113 or go to (AzHealthNow)and fill out a confidential quote form.