What is Medicare?
Medicare is a federally funded program which provides health and hospital insurance benefits for persons who are 65 years of age and older, recipients of Social Security disability benefits, and individuals suffering from end stage renal disease. Recipients of Railroad Retirement benefits are also eligible for Medicare. Unlike the Medicaid program, eligibility for Medicare is not dependent upon an individual's income or assets.
The Medicare program contains three components. Part A provides hospital insurance benefits, including inpatient hospital care, inpatient nursing home services, home health services, and hospice care. Part B provides medical insurance benefits, including services provided by physicians and other medical practitioners, outpatient hospital services, durable medical equipment, and physical, occupational and speech therapy services. Part C consists of the Medicare+Choice program. Under this program, Medicare beneficiaries can voluntarily choose to enroll in one of an assortment of private health plans. These plans include traditional Medicare, managed care plans, private fee-for-service, and medical savings accounts. Note that Medicare beneficiaries are not required to participate in the Medicare+Choice program. If a beneficiary is satisfied with his or her present coverage under Parts A & B, the beneficiary can continue with that coverage.
Medicare Part A is financed primarily by payroll taxes paid by employers and employees. Medicare Part B is financed by general revenues from the federal government and by monthly premiums paid by Medicare beneficiaries. The monthly premium paid by beneficiaries in 2001 is $50.00.
Generally, Medicare coverage is available to individuals who are 65 or older, as well as certain disabled individuals under 65, including disabled workers, disabled widows and widowers, childhood disability beneficiaries, and individuals suffering from end stage renal disease (terminal kidney disease). Recipients of Social Security Disability or Railroad Retirement Disability benefits qualify for Medicare coverage after they have been entitled to disability benefits for a period of 24 months.
Individuals who attain age 65 without at least 40 quarters of coverage under Social Security are not automatically eligible for Medicare. However, these individuals can voluntarily enroll in Medicare Part A by paying a monthly premium. In 2001, the monthly premium for these individuals is $300. This premium is reduced to $165 for individuals who have at least 30 quarters of coverage under Social Security.
Part B coverage is available to beneficiaries who are eligible for Part A. Part B coverage is voluntary and requires the payment of a monthly premium, which is $50.00 for 2001. For persons who do not enroll as soon as they are eligible, and then later decided to enroll in Part B, there is a premium surcharge. The surcharge consists of an increase of 10 percent in the premium rate for each full year the beneficiary was out of the program. Waivers of this surcharge are available to employees or spouses who continue coverage under an employer health insurance plan.
Individuals who are entitled to Part A coverage and are enrolled in Part B coverage are eligible to enroll in a Part C Medicare+Choice plan.
Yes, but only in limited situations. Medicare will provide coverage for up to one hundred days of care in a nursing home or a section of a hospital that qualifies as a skilled nursing facility. This coverage will only be provided if the beneficiary was hospitalized for at least three consecutive days prior to entry into the institution, and the beneficiary requires a skilled level of nursing care or skilled rehabilitation services on a daily basis. This coverage is limited to skilled nursing services. There is no Medicare coverage if the beneficiary requires only custodial care.
Yes. The Medicare deductible and coinsurance amounts are revised annually. For the year 2001 the amounts are as follows:
•Inpatient hospital services - $792 deductible per spell of illness, as well as a coinsurance amount of $198 per day for days 61 through 90, and a coinsurance amount of $396 per day for 60 lifetime reserve days.
•Nursing home care - $99 per day coinsurance for days 21 through 100
•Part B services - $100 annual deductible and a coinsurance amount which is 20% of approved allowable charges.
If a Medicare denies coverage on a claim, does the beneficiary have the right to appeal?
Yes. If Medicare denies coverage, the beneficiary is entitled to receive written notice of the determination. The general time limit for appealing the denial is sixty days. By regulation, five days are added to the decision date to allow for mailing. As a result, the beneficiary has 65 days from the date of the decision to appeal.
Medicare Part A claims are reviewed through the Social Security claims process. If a claim is denied, the beneficiary has the right to request reconsideration. The reconsideration is done by a reviewer of the same rank as the initial decision maker, and the review is conducted with the same information. If the claim is again denied, and the claim involves $100 or more, the beneficiary has the right to request a hearing before an administrative law judge (ALJ). If the ALJ decision is unfavorable, it can be appealed to the Departmental Appeal Board of the Department of Health and Human Services. If that appeal is unsuccessful, and the claim involves $1,000 or more, the beneficiary can seek judicial review in federal district court.
Under Part B beneficiaries submit claims to private carriers, who determine those claims according to procedures established under the Medicare Act. The carrier then notifies the beneficiary of its determination. If the beneficiary is dissatisfied with the determination, he or she may request a review determination. A different employee of the carrier then reviews the initial determination on the claim. If the beneficiary is still dissatisfied, and the claim involves $100 or more, the beneficiary can request a fair hearing. The hearing is conducted by a hearing officer designated by the carrier. The fair hearing may be conducted by telephone, in person, or by a simple review of the record. The hearing officer then issues a written decision. If the fair hearing decision is unfavorable, and the issue involves $500 or more, the beneficiary can then request a hearing before an ALJ. From that point on the appeals process follows the same process that is used for Part A claims.
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Legal Assistance of Western New York, Inc.
This article provides general information about this subject. Laws affecting this subject may have changed since this article was written. For specific legal advice about a problem you are having, get the advice of a lawyer. Receiving this information does not make you a client of our office.
Medicare laws are constantly changing. This information is accurate as of March, 2001.