Q&A: Medicare Advantage information for state and university retirees

The changes to retiree health care plans only apply to SERS and SURS annuitants and their covered dependents who are enrolled in Medicare Parts A&B and reside in the United States. Also, in order to transition to the new plans ALL your covered dependents must be enrolled Medicare eligible. So, if you are 66 and your spouse is 60, neither of you will transition onto the new plans until your spouse is 65.

If you are Medicare-eligible and wish to remain in the state health plan, you must choose a Medicare Advantage plan. However, you can opt out of the state health plan and purchase your own Medicare Supplement if you so choose.

Co-plays and deductibles will be consistent with the plan design changes that were implemented on July 1, 2013. However, the annual maximum out-of-pocket costs for your medical care will be lower under the Medicare Advantage PPO—$1,300 annually. 

If you select the Medicare Advantage United Health care PPO:

Under the United Health care PPO (UHC) you can see any willing medical provider anywhere in the United States as long as the provider accepts Medicare patients. Even if the provider is not part of the UHC network, the UHC PPO will still cover your medical expenses up to the Medicare allowable rate. Your provider can simply bill UHC directly or they can bill you and you can submit the bill to UHC. In either event, UHC will pay the provider (or reimburse you) within ten (10) days. You will pay the same percentage co-payment whether or not your provider is in the UHC network. However, your costs may be lower with an in-network provider because he or she may be billing at a lower rate.

To summarize, here is a chart of the various possibilities:

Willing provider that is part of the UHC network:

• Covered under the plan.

Willing provider that accepts Medicare patients and agrees to accept payment from UHC:

• Covered under plan up to the Medicare allowable rate.

Willing provider that accepts Medicare patients, but does not agree to bill UHC:

• Covered under plan up to the Medicare allowable rate, but you must submit the bill to UHC who will then reimburse you or your provider for the costs of the visit in approximately ten (10) days.

Provider that does not accept Medicare patients:

• Not covered under this plan.

Important Note: If your medical provider is refusing to accept the new plans, or will not schedule treatment as a result of the new plan, please call either United Health care or CMS directly and inform them of the issue. In the first several months of the new plans this will be a possibility, as not all clinics and hospitals are aware of the new plan’s structure.

United Health care: 1-888-223-1092, TTY 711

Central Management System (CMS): (217)782-7007

If you select the Medicare Advantage Aetna or Humana HMO:

HMO plans come with a rigid network of specific providers. Care within these networks is sometimes cheaper than the PPO option, but going out-of-network can involve significantly higher costs. In addition, the annual maximum out-of-pocket for the HMO plans is much higher than for the PPO ($3,000 versus $1300), and out of network expenses do not contribute to your maximum out-of-pocket. Basically, this option is a good choice if you seldom need medical care and all the doctors and other providers you prefer are in the HMO network.

In order for you and your spouse to transition into the new Medicare Advantage plans, both of you must be Medicare eligible. For example, this means that if you are 65 (and therefore Medicare eligible) and your spouse is 62 years old (and Medicare ineligible), then neither of you will transition into the new plans. You will both stay on the plans you currently have until both of you are Medicare eligible. The same applies for dependent children.

The plan year began on February 1, 2014. The next plan year will begin on January 1, 2015, and every plan year after will also commence on January 1.

If you are not Medicare eligible, then you will stay on the plan you have now and no action is required on your part.

Insurance companies send out a large amount of advertisements in the mail which can lead to widespread confusion, especially in the fall. If the material you receive is not from CMS, AFSCME, another labor union (IFT or IEA, for example) then you should feel safe in disregarding the information contained therein. When CMS sends information about the plans, it will contain a logo that says: “Total Retiree Advantage Illinois (TRAIL)” or a CMS letterhead. Any deadlines that advertisers may be referring to likely refer to Medicare enrollment for people not yet enrolled in individual Medicare plans and do not apply to the vast majority of retirees.

All of these plans are what are known as MA-PD plans, which is short for Medicare Advantage Plan with Prescription Drug Coverage. Under all of the Medicare Advantage plans, Medicare’s so-called prescription drug “donut hole” does not exist. There is no gap in prescription drug coverage. Under both the HMO and PPO plans, drug coverage costs the same, both for copays and deductibles, as the current HMO and PPO plans respectively.

Your dental and vision coverage will remain the same as it is now if you enroll in a Medicare Advantage plan. If you do not enroll in Medicare Advantage and instead decide to opt out of the state insurance plans during the enrollment period, you will not be able to keep your vision coverage, but you may elect to keep your dental.

This is dependent on what county you live in. Most counties will have the choice between the United Health care PPO and one or more HMO plans.

In short, it doesn’t. There is a lot of misinformation being spread about the Affordable Care Act (ACA) to seniors. The switch to Medicare Advantage plans is not related in any way to the rollout of the ACA. The Affordable Care Act does make some improvements to Medicare benefits, such as allowing an additional wellness visit annually and some additional free preventative services—and these will be available to retirees in the Medicare Advantage plans as well.

People on Medicare disability will go on to the new Medicare Advantage plans if they were receiving Medicare part A & B prior to September 30, 2014. People that are receiving A&B after September 30, 2014 will go on the MA plan during the next enrollment period in November 2015.

Here are the pricing plan details based on available information.

Note that the copay structure for the HMO plans is different from the PPO plan. Under the HMO plans you have a flat copay as outlined below, but this only applies to providers/services that are in-network. For the most part, out-of-network providers and services are not covered under the HMO plans. The United Health care PPO, however, has a 15% copay for most services, which applies whether you are in-network or not. This means that you will pay 15% of your medical bill every time you visit a provider/ use a service.

However, another big difference between the HMO plans and the United Health care PPO plan is the annual out-of-pocket maximum, which is the most that you can pay for medical services in a given year. The annual out-of-pocket maximum for the HMO plans are $3000 for each plan participant, while the United Health care PPO is only $1300. That means that while you may be paying more in copays with United Health care PPO, you will reach the maximum out of pocket limit much sooner. Another difference is that with the United Health care PPO both in-network and out-of-network copays count towards your out-of-pocket maximum. With the HMO plans only in-network copays count–any costs associated with out-of-network services do not count towards your out-of-pocket maximum.

Please also carefully review the materials that CMS and the insurance companies have sent you.