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FEHBP and Medicare: Make the BEST Choice
A NARFE Federal Benefits Institute Webinar
Presented by Tammy Flanagan
Sponsored by National Active and Retired Federal Employees Association 2
Medicare
Original Medicare: Part A–Hospitalization
Part B–Doctors services, outpatient care
Part C–Medicare Advantage Plans
Includes Part A and Part B
Part D–Prescription drug coverage
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FEHBP
• Federal Employees Health Benefits Act of 1959
• 90 different plans with 250+ plan options
• OPM authorizes contract and regulates
• Employees & retirees: same plans / same cost
• $50 billion program
• 8.2 million enrollees
• About 85% of federal employees participate
• About 90% of retirees participate
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Test Your Knowledge When did federal employees begin paying into Medicare?
A. 1960 B. 1965 C. 1983 D. 2001
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Test Your Knowledge When did federal employees begin paying into Medicare?
A. 1960 B. 1965 C. 1983 D. 2001
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Did you know?
You are not required to enroll in Medicare at age 65
Your Federal Employee’s Health Benefits Program
plan will continue to provide coverage
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Part A - The Easy Part!
No premium, covered by 1.45% Hospital Insurance Tax
In general, Part A covers:
• Hospital care
• Skilled nursing facility care
• Nursing home care (as long as custodial care isn't the only care you need)
• Hospice
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Part A - Hospital Insurance
Medicare pays FEHBP pays
Days 1 - 60 All but $1,288 deductible $1,288 deductible
Days 61 - 90 All but $322/day of each benefit period
$322 / day
Days 91 and beyond All but $644/day up to 60 days per lifetime
$644 / day
Beyond lifetime reserve days
$0 All Costs
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Excerpt from 2016 OPM Carrier Call Letter
• Limiting cost growth;
• Managing prescription drugs;
• Ensuring access to care;
• Coordinating benefits for the Medicare population;
• Implementing plan performance assessment; and
• Continuing to implement Self Plus One coverage. https://www.opm.gov/healthcare-insurance/healthcare/carriers/2016/2016-03.pdf
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Hold Harmless
No COLA for Social Security benefit
= No increase in Part B Premium
The provision protects only people who have Part B
premiums withheld from their Social Security checks.
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NARFE and others are urging Congress to act quickly to avert Medicare increase:
“Should the Medicare trustees’ assumptions hold, roughly 70
percent of Medicare beneficiaries will be held harmless,
while the remaining 30 percent will shoulder the cost of the
expected premium increase,” the letter said.
New Medicare enrollees; individuals not collecting Social
Security benefits; and beneficiaries already paying higher,
income-related premiums will be most affected.
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History of
Part B Premiums
Year Part B Premium
1966 $3
1976 $7.20
1986 $15.50
1996 $42.50
2006 $88.50
2007 $93.50*
2013
$104.90*
2014
2015
2016 $104.90 or $121.80*
2017 possible 22% increase
to $149*
Yearly cost: $121.80 x 12 months = $1,461.60
$1,461.60 x 2 people = $2,923.20
*Higher premiums for high-income enrollees
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Your Annual Income
Your 2016
Monthly Premium
% of Part B
Premium Individuals Couples
Equal to or
below $85,000
Equal to or
below $170,000
$121.80 25%
$85,001 –$107,000 $170,001 – $214,000 $170.50 35%
$107,001 – $160,000 $214,001 – $320,000 $243.60 50%
$160,001 – $214,000 $320,001 – $428,000 $316.70 65%
Above $214,000 Above $428,000 $389.80 80%
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Test Your Knowledge
Percentage of non-pediatric primary care physicians who accept Medicare in the United
States
A. 50% B. 72% C. 93% D. 35%
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Test Your Knowledge
Percentage of non-pediatric primary care physicians who accept Medicare in the United
States
A. 50% B. 72% C. 93% D. 35%
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Finding Medicare Doctors
Medicare
Physician
Compare
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Enrolling in Medicare
Initial Enrollment: 7 months beginning 3 months before you turn 65
General Enrollment: January 1 - March 31 (coverage begins July 1)
Special Enrollment: 8 months following
end of employment that included group
health insurance coverage
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Enrolling in Medicare
Enrollment is automatic for Medicare Part A and Part B if you are:
• Receiving benefits from Social Security or the Railroad Retirement Board
• Under age 65 and have a disability.
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Enrolling in Medicare
● Apply online www.ssa.gov
● By phone 1-800-772-1213
● In person at any Social Security office
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Primary Payer
When you – or your covered spouse – are age 65+ and you…
Medicare FEHBP
Are working and have your insurance deducted through current employment
The Federal Employees Health Benefits Program and Medicare (RI 75-12)
Special Enrollment: 8 months following end of employment that included
group health insurance coverage
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Primary Payer
When you – or your covered spouse – are age 65+ and you…
Medicare FEHBP
Are retired and have your insurance deducted from your retirement benefit
The Federal Employees Health Benefits Program and Medicare (RI 75-12)
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Advantages of enrolling in Medicare A & B
Caution: Many of the advantages of enrolling in
Medicare A & B are realized after Medicare is primary payer.
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Reasons to Consider Enrollment Medicare A & B
• Avoid late enrollment penalty for Part B
• You may leave a regional plan / HMO
• Better chance of avoiding catastrophic cap
• Begin scheduling social life around doctor appointments
• Move back to U.S. from overseas
• Live another 40+ years after 65
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When Medicare is primary...
• FEHBP plans reap rewards by being secondary payer
• You no longer will need to use FEHBP preferred providers (some plans)
• You no longer need precertification hospital stays
• Use any provider that accepts Medicare
• Providers are required by law to file claims
– This is true whether or not they accept Medicare
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When Medicare is primary...
• Lower out of pocket cost for health care – Some FEHBP plans will waive deductibles,
co-payments and coinsurance – Some FEHBP plans will lower cost of
prescription expenses
• Medicare specializes in the needs of the elderly and disabled – Skilled nursing care – Durable medical equipment – Physical, occupational and speech therapy
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Medicare may be better for:
• Orthopedic and prosthetic devices
• Durable medical equipment
• Home health care
• Limited chiropractic services
• Therapies (physical, occupational, etc.)
• Some medical supplies
(Check your plan brochure for details.)
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Medicare does not cover:
• Long-term care (also called custodial care)
• Most dental care
• Eye examinations related to prescribing glasses
• Dentures
• Cosmetic surgery
• Acupuncture
• Hearing aids and exams for fitting them
• Routine foot care
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Some/all FEHBP plans provide...
• Emergency care (all plans) and non-emergency care (not all) outside the United States
• Dental and Vision care (not all)
• Catastrophic coverage
• Prescription coverage
• Hearing aids (not all)
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What Are the Options?
Change FEHBP plan Less expensive plans available
Delay Part B enrollment
Incur 10% surcharge for every 12 months delay (exception for current employment health coverage)
TRICARE for Life Only available to military retirees and spouses
Medicare Advantage Plans
May incur higher out-of-pocket expenses
Medicaid Must meet the financial requirements
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Cost of FEHB Plans
Self Only Self Plus One
Self Only Self Plus One
APWU High Option
$204.29 $406.75 GEHA Standard $116.70 $250.90
APWU CDHP $133.92 $294.62 GEHA HDHP $122.85 $264.14
BCBS / Standard $229.64 $521.67 MHBP Value Plan
$129.44 $306.69
BCBS / Basic $154.32 $356.72 MHBP Standard
$147.08 $338.56
GEHA High Option
$219.83 $509.36 MHBP HDHP $140.55 $311.03
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Cost of FEHB Plans
Self Only Self Plus One
Self Only
Self Plus One
NALC High $167.70 $381.74 United Healthcare of CA High
$177.77 $321.28
NALC CDHP $116.06 $251.06 United Healthcare of CA Standard
$153.27 $299.35
NALC Value $95.25 $206.03 Kaiser Mid-Atlantic High
$161.41 $419.40
SAMBA High $372.68 $845.67 Kaiser Mid-Atlantic Standard
$121.01 $273.47
SAMBA Standard $158.07 $360.14 Aetna Direct $120.05 $263.29
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How to choose?
• Consider a less expensive FEHBP plan
• Compare cost of prescriptions
• Compare Medicare enrollment incentives
• Is there a health fund or do you have an HSA?
• Do you have any chronic illnesses?
• Do you need additional dental / vision plan?
• Open seasons occur every year / one personal age 65+ event
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Use Tools to
Compare:
Office of Personnel Management
Health & Insurance
COMPARE PLANS
● Find plans by location
● Find plans by name
● Find plans by plan code
Enter up to 4 plans
https://www.opm.gov/healthcare-insurance/healthcare/plan-information/compare-plans/
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Use Tools to
Compare
Office of Personnel Management
Choose a Plan & Enroll
FEHBP Plan Information for 2017
https://www.opm.gov/healthcare-insurance/healthcare/plan-information/plans/
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Use Tools to
Compare
FEHBP Plan Brochures
Medicare info: Section 9
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Age 65 and over without Medicare
• Pay deductibles, co-payments and coinsurance.
• Subject to catastrophic limits of plan.
• FEHBP will limit payments for inpatient hospital care and physician care to payments you would be entitled to if you had Medicare.
• Your physician and hospital cannot bill you for more than they could bill you if you had Medicare.
• Outpatient hospital care and non-physician-based care are not covered by this law; regular Plan benefits apply.
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TRICARE for Life
• Must enroll in Medicare A & B
• May “Suspend” FEHBP
• No need for Medicare Part D
• No need for Medicare Part C
• 1-800-538-9552
• 1-866-363-2883 (TDD/TTY)
• http://www.tricare.mil/LifeEvents/Medicare.aspx
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Low-Income Benefits
• Medicaid
• Medicare Savings Programs (4 kinds of MSP)
– Call your State Medicaid Program
• PACE (community based care)
• Supplemental Security Income
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More Information Available:
• Medicare Interactive Website – https://www.medicareinteractive.org/
• National Association of Area Agencies on Aging
– http://www.n4a.org/
• State Health Insurance Assistance Program (SHIP) – https://www.shiptacenter.org/
• Medicare – www.medicare.gov (Your Medicare Costs tab)
• Social Security Administration – 1-800-772-1213 or https://www.ssa.gov/pubs/EN-05-11011.pdf
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narfe Magazine
October 2016: Pages 52 -56
Stay tuned for more: November and
December
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NARFE New York Federation
http://www.narfeny.net/
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To-Do List
• Consider Self Plus One (for family of two)
• Report Medicare enrollment to FEHBP and doctors
• Compare and consider all available FEHBP plans
• Attend a local health fair if available
• Consider future health care costs
• Spend as much time on choosing health plan as you do planning your next vacation!
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Open Season
November 14-December 12
GF-PPT-1016-001
Find the health plan that fits.
geha.com/switch