By Rick Banas of assisted living provider BMA Management, Ltd.
If you are on Medicare, please pay attention. From what I learned on Saturday thanks to a Client Care program conducted by Law Elder Law of Aurora, Illinois, there are a number of issues and cutbacks to the Medicare program that are affecting seniors right now and more changes are on the way.
Starting last October, hospitals began to be penalized for excessive re-admissions of Medicare patients who are re-admitted within 30 days of when they were discharged from the hospital. There are two key reasons for the penalty, explained Rick Law of Law Elder Law. Rick is a Certified Elder Law Attorney.
First, the government is working to pressure hospitals to keep the cost of care down. Secondly, the government has come to the conclusion that too many doctors have been admitting too many seniors to the hospital just so that the patient can qualify for rehabilitative care in a Medicare-certified skilled nursing facility.
As a result of the potential penalty, hospital staff members are being told that it is their job to not admit those on Medicare as Inpatients. Rather, they are diverting Medicare patients to the Emergency Room or holding and treating them under Observation Status, often in a hospital bed in a hospital room alongside an Inpatient. This practice has an enormous financial impact for those on Medicare.
It means that the person on Medicare will be responsible for a much higher share of the cost of care for being treated in the hospital as Medicare Part B, which helps cover Outpatient care and Emergency Room care, has a much higher deductible than Medicare Part A, which covers Inpatient care.
It also means that the person on Medicare will not be eligible for any Medicare coverage for the cost of Rehabilitative care after you are hospitalized, even if you have been in the hospital for the required period of time. One of the requirements for Medicare coverage is that you have to have been admitted to the hospital as an Inpatient for at least three days, not including the day that you are discharged from the hospital. Being in the hospital under Observation Status does not count.
The Centers of Medicare and Medicare website, in fact, has these words of warning:
Did you know that even if you are in the hospital overnight, you might still be considered an Outpatient? Your status affects how much you pay for hospital services and whether Medicare will cover care at a skilled nursing home.
If you are in the hospital for more than a few hours, always ask your doctor or the hospital staff if you are an Inpatient or Outpatient?
Click here for more information on Inpatient or Outpatient.
Those on Medicare need to be much more conscious about contacting their doctor to be sure that they fully understand what is happening with their care, Rick said. There is the potential to lose enormous amounts of money and possibly your house. One client was presented with a $43,000 bill for her mother’s care in a rehabilitation center. The mother needed the rehabilitation following her hospitalization, but was not eligible for coverage because she was treated in the hospital as an Outpatient rather than as an Inpatient.
She was not alone. Rick cited information from the Center for Medicare Advocacy, Inc., that indicated that the Office of the Inspector General found that in 2012, 600,000 Medicare recipients who had more than three days in the hospital did not qualify for post-hospital skilled nursing facility Rehabilitation because they were in the hospital under Observation Status. The Center for Medicare Advocacy also reports that the new rules issued by the Centers for Medicare and Medicaid to go into effective Oct. 1, 2013 on Inpatient hospital reimbursement do not resolve the Observation Status issue.
Rick also talked about a letter that many patients are receiving from their doctor, saying that “we have really good news for you.” The letter contends that your doctor will be able to provide you “with much better service” as the doctor no longer is in private practice, but is now an employee of a hospital or a health care system. The concern, Rick noted, is that your doctor now has to follow the directives of the hospital. The hospital, not you, is now the doctor’s boss.
Michael Sams, of Sams/Hockaday & Associates, Inc. of Decatur, Illinois, talked about Medicare Supplement Insurance, which also is known as Medigap or MedSupp. Medicare Supplement Insurance helps to cover costs such as deductibles and co-insurance that are not covered by Medicare Parts A and B.
All Medicare Supplements are standardized by Medicare so the benefits are the same, no matter the company providing the insurance. Whether or not you will be eligible for coverage also does not depend on the company providing the insurance as Medicare, not the insurance company, approves coverage and the charges.
What is different is the cost to the Medicare recipient for the same Medicare Supplement Plan. Prices can vary significantly from one insurance company to the next. For example, the cost for the same plan for a 75-year-old female non-smoker in the Chicago area among three different insurance companies differed by nearly $60 a month. He recommended talking with a capable Medicare Supplement Insurance agent.
Sams also urged those on Medicare to be sure that they re-evaluate their Medicare Part D Plans during the 2013 Open Enrollment Period, which is scheduled to run from Oct. 15 through Dec. 7.
Not all the specifics are available yet, but your current plan is likely to change for 2014 even if you just allow it to roll-over.
Brian Timothy LeClercq, who is a financial advisor with Walnut Street Securities, Inc. and the President of the Village of Oswego, provided some tips on Long-Term Care Insurance.
The right type of long-term care insurance should include coverage for in-home care, assisted living, skilled nursing and adult day care. He highlighted coverage for adult day care because of the toll that caregiving has on the caregiver. Adult day care can provide the caregiver with relief.
He also noted that hybrid life insurance policies that include long-term care insurance are a potential alternative to traditional long-term care insurance.
As they advised, you need to pay attention.
All affordable assisted living communities managed by BMA Management, Ltd. are certified and surveyed by the Illinois Department of Healthcare and Family Services. All assisted living communities are licensed and surveyed by the Illinois Department of Public Health.
“BMA Management, Ltd. is the leading provider of assisted living in Illinois
and one of the 20 largest providers of assisted living in the United States.”
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