Medicare Health Insurance Definitions

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Medicare Health Insurance Definitions

[usa_container toggle=”true” closeall=”true” animate=”fade” search=”true” theme=”theme-blue” highlight_bg=”#eeee22″ highlight_color=”#000000″ nav_box=”square” nav_icon=”angle_double” placeholder=”Type your search term here” msg_item_found=”> is the total number of categories your search phrase was found under. Each one is under a separate word or phrase below.” msg_no_result=”We couldn’t find anything…try another search term” limit=”3″][usa_item acc_title=”Accountable Care Organizations (ACO)”]The concept of an ACO sort of works like an HMO where groups of health care providers, hospitals and doctors, agree to be responsible for the costs and overall care of their Medicare members who are a part of the ACO to improve the quality of care their patients receive, reduce waste and duplication, and minimize bureaucracy.  These groups will create new ways of doing things better and more efficiently and cost effectively, to save in overall health care expenses.  Health care providers will receive financial incentives only IF they improve patient care outcomes and cost savings.  These ACO’s will be closely linked to “Quality of Care Reporting.”[/usa_item][usa_item acc_title=”Annual Election Period (AEP)”]Every year, Medicare’s Annual Election Period (AEP) is from October 15th through December 7th.[/usa_item][usa_item acc_title=”CLASS Act”]Not moving forward with this program.  It has been shelved for now.[/usa_item][usa_item acc_title=”Co-Insurance”]Co-insurance means 2 parties will be paying for the bill.  “Co” means joint, mutual, 2 or more.  The insurance company will usually pay the larger amount (example 70%) and you the member will usually pay the lesser amount (example 30%).  This would be a co-insurance 70/30. 

This (co-insurance) usually happens AFTER the deductible (see definition).[/usa_item][usa_item acc_title=”Co-Pay”]A Co-pay is a set dollar amount you pay for a procedure or office visit.  (Look at your plan summary very carefully)  A co-pay is helpful because you’ll GENERALLY pay just the co-pay (unless other procedures are billed by your doctor in addition to the co-pay).  For example, let’s say you see your family doctor for a sore throat.  If your plan had a co-pay of $35 dollars, you’d pay the $35. 

But wait, there’s more:  Sometimes you can be billed more than just a co-pay.  For example, let’s say you went to a specialist (specialist co-pays are generally more than a primary care doctor) to have a spot on your skin looked at.  The office co-pay may be $50.  You’d pay the $50 for the office visit.  But if the doctor wanted to remove the spot, he could charge you/your insurance company for a “procedure”.  That charge would be in addition to the co-pay.  So the procedure could be billed to your insurance company and you’d pay whatever your insurance company had negotiated with the doctor for that procedure.[/usa_item][usa_item acc_title=”Medicare Changes”]There are changes for seniors with the Affordable Care Act (ACA).  The goals are to improve the quality of care for those eligible for Medicare, improve the Medicare system (how Medicare works), make pricing changes (reimbursement changes), and modernizing systems and pro-actively deterring how we fight fraud, waste, and abuse.

♦ Quality of care

◊ Hospital Re-Admissions Reduction Program.  The goal of this program is to improve the quality of care for Medicare patients.  Hospitals will be working with other hospitals, doctors and health care providers to find ways to reduce readmissions that were avoidable, reducing readmissions back into the hospital.  The ACA wants to send people home healthier, and to avoid readmissions for the same problem they were originally admitted for.  If hospitals can prove they are sending home healthier patients that don’t get re-admitted, they’ll receive a greater financial incentive to do that.  Readmissions info on hospitals can be found at www.hospitalcompare.gov.

◊ Reduce hospital acquired infections/conditions.  The ACA will penalize the bottom 25% of hospitals whose hospital acquired conditions are the highest.  Examples would be like getting bedsores, complications from using urinary catheters too long, falls that cause injuries.

◊ Rewarding Better Care.  The program increases payments to Doctors who improve care to their patients for five of the most frequently treated medical conditions that require care.  Physician payments will closely match the value given to their patients, with the launch of a physician value-based payment system, and the implementation of a “value-modifier”.

◊ Bundling payments for Renal Failure expenses.  Expenses like supplies and dialysis related services will be bundled.

♦ Reform our delivery system.  The ACA has several provisions that will help doctors and nurses to spend more time with their patients and to reduce repetitive testing and procedures.  These provisions encourage a team-based approach to caring for patients and encourage better physician and hospital performance with programs in place to measure outcomes.

◊ Accountable Care Organization (ACO).  The ACO sort of works like an HMO where health care providers agree to be responsible for the costs and overall care of their members who are a part of the ACO.  The Department of HHS can grant these organizations the ACO status, and once these groups (doctors, nurses, hospitals) work together to make improvements and find ways to reduce costs by working together, they can share financially in some of these savings.

◊ Independent Payment Advisory Board (IPAB).  In addition to the ACO, there is the IPAB.  This committee is designed to slow down Medicare spending.  In 2014, if spending is greater than allowed, this IPAB must recommend ways to reduce Medicare spending, but the board has been instructed to maintain quality for Seniors.  This will probably get pushed back to 2018.  Many folks that do not like health care reform have termed this part of the health care reform bill the “Death Panels”.

◊ Center for Medicare and Medicaid Innovation.  This program develops new ways of making payments to health care providers and the delivery of health care services by creating the Center for Medicare and Medicaid Innovation.  $10 billion will be invested in this Center over the next 10 years to test better payment and delivery programs that will streamline payments and increase cost efficiency.

♦ Modernize Pricing and Financing systems.  This does several things including update their systems to more modern systems.  Creates competitive bidding for medical equipment to drive prices down and increase competition.  “Ends Overpayments” to Medicare Advantage plans.  It “adjusts reimbursement rates” (medical professionals get paid less).  It ends “overpayments to insurance companies”.  It “makes improvements to productivity and market basket adjustments”.  What this means is the law reduces funds for inpatient and outpatient hospital services, psychiatric facilities, long term care hospitals and inpatient rehab facilities.  This program will also modify payments for imaging services.  According to the CMS, these reductions in payments are estimated to save $370 billion dollars over the next 10 years starting in 2010 when the law passed.

♦ Reduce Fraud, Waste and Abuse.  There is allocated $350 Million dollars to be spent hiring on-site inspectors and fraud investigators and staff RAC’s (Recovery Audit Contractors).  They will have new screening processes, better ways of sharing data with one another and new penalties.  Preventing Fraud, Waste and Abuse is the new goal to reduce fraud, waste and abuse instead of finding the abuser after they have abused.   There are new screening tools that will be used to make certain that only legitimate providers are billing Medicare.  Certain groups contracted with Medicare that bill Medicare will be required to post “surety bonds” depending on the volume they are billing Medicare and also risk factors.  The CMS will be using state of the art technology that can monitor Medicare billing threats in “real time” that could suspend payments.  There will be in person on site visits of suspicious entities to stop fraudulent schemes.  2 big new changes.  From now on, home health visits and DME (durable medical equipment) to be paid for by Medicare, the client must be enrolled in Medicare for it to be paid AND the patient must have a face to face visit with his/her doctor in order to have the home health visits or the DME order paid for by Medicare.  Also, there is a new “transparency in nursing home ownership” law.

[/usa_item][usa_item acc_title=”Plans That Don’t Have To Comply With ACA – “Excepted Benefits””]These plans do not have to comply with the ACA.  Accident only plans, Wellness plans that are not associated with a major medical plan that are considered “stand alone”, stop loss plans, retiree only plans, Medicare, Tricare, Medicaid, CHIP, group plans that have less than 2 employees, disability income, long term health care, workman’s comp, auto medical, liability insurance, on-site medical clinics, mini-medical plans, limited scope benefits, credit-only, and non-coordinated benefits. 

Check with your plan to see if it is an “Excepted Benefits” plan.[/usa_item][usa_item acc_title=” Medical Records System – HIPAA”]As part of the Health Care Reform law, there was an addition to the HIPAA (Patient Protection) Regulation Act starting in 2013.  The new law requires streamlining (sharing) of all medical records between hospitals and doctors and health care providers.  For example, if you are admitted to a hospital in the future, all your past medical history would be available to the doctors at the hospital you are newly admitted to.  Medical professionals (doctors) will be able to access your baseline medical history and add to your medical chart all your new diagnosis and procedures into the same system.  This applies to all health care providers.  This new system will help to cut down on duplicate ordering of tests, and allow doctors to see results of prior tests.  It will assist in reducing overall medical costs and increase speed and accuracy of medical records.[/usa_item][usa_item acc_title=”What types of coverage does NOT have to comply with the ACA?”]Also called “Excepted Benefits” –  Accident only plans, Wellness plans (that are not associated with a major medical plan that are considered “stand alone”), retiree only plans, stop loss plans, Medicare, Tricare, Medicaid, CHIP, group plans that have fewer than 2 employees, disability income, long term health care, workman’s comp, auto medical, liability insurance, on-site medical clinics, limited scope benefits, mini-medical plans, credit-only, and non-coordinated benefits. 

Check with your plan to see if it is an “Excepted Benefits” plan.
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