AmeriTex Brokerage Group, LLC

Texas Individual Medicare Supplements

Medicare is a federal health insurance program for people 65 or older, some people under 65 with disabilities, and people with end-stage renal disease or Lou Gehrig´s disease. If you are on Medicare, it will pay for much - but not all - of your health care. Medicare supplement insurance can help you fill in some of the "gaps" that Medicare won´t pay. There are 10 standardized Medicare supplement insurance plans, labeled "A" through "J." Each plan offers a different combination of benefits. Two plans, F and J, offer a high-deductible option.

Not everyone needs a Medicare supplement policy. If you have certain other types of health coverage, the gaps in your Medicare coverage may already be covered.

You probably don´t need Medicare supplement insurance if

• you have group health insurance through an employer or former employer, including government or military retiree plans
• you belong to a Medicare Advantage plan
• you receive Medicaid or are a Qualified Medicare Beneficiary (QMB).

Medicare Basics

Medicare Part A (hospital) pays for in-patient hospital services, skilled nursing facility care after a hospital stay, home health care, and hospice care. Medicare Part A also pays for all but the first three pints of blood in a calendar year.

Medicare Part B (medical) pays for medical expenses, clinical laboratory services, and outpatient hospital treatment. In most cases, Medicare pays 80 percent of the cost of covered services.

Covered medical expenses include physicians´ services and supplies. Some Medicare Part B services are paid as a fixed copayment under the outpatient prospective payment system.

Medicare also pays for some preventive services. Ask your physician whether Medicare will pay for the preventive services you´re considering.

Read the Centers for Medicare and Medicaid Services´ Medicare and You handbook for information on what you´ll have to pay for Medicare Part A and B. The handbook is mailed to Medicare beneficiaries each year.

Services Not Covered by Medicare

• Custodial care, such as help walking, getting in and out of bed, dressing, bathing, toileting, shopping, eating, and taking medicine (these are commonly referred to as activities of daily living)
• More than 100 days of skilled nursing facility care during a benefit period following a hospital stay (the Medicare Part A benefit period begins the first day you receive a Medicare-covered service and ends when you have been out of the hospital or a skilled nursing facility for 60 consecutive days)
• Private duty nursing care
• Most outpatient prescription drugs, although a Medicare-endorsed prescription drug discount card will be available sometime in 2004
• Homemaker services
• Most dental care and dentures
• Health care received while traveling outside the United States, except under limited circumstances
• Cosmetic surgery and routine foot care
• Routine eye care, eyeglasses (except after cataract surgery), and hearing aids.

What You´ll Have to Pay with Medicare

Both Medicare Part A and Part B have costs that you must pay. These include monthly premiums, deductibles, copayments, and coinsurance. The amounts may change each year in January. You pay the full cost of services not covered by Medicare.

A deductible is the amount you must pay for covered medical expenses before Medicare begins to pay. A copayment is a fixed charge for a medical service. Coinsurance is the percentage of the cost of a covered service that you pay after Medicare pays its portion of the cost.

Health care providers who accept "assignment" agree to limit their fee to the Medicare-approved amount for a service or supply, although you must pay any deductibles, coinsurance, or copayments due. Providers who do not accept assignment may charge as much as 15 percent above the Medicare-approved amount when treating Medicare patients. You must pay the excess amount. The amount you owe is shown on the Explanation of Medicare Benefits or Medicare Summary Notice that you receive from Medicare. If you were charged more than the 15 percent and paid it, your provider must refund the excess charges to you within 30 days. If you believe a provider has overcharged you, question the bill before you pay it and contact TrailBlazer Health Enterprises, the Medicare carrier for Texas.

TrailBlazer maintains the Medicare Participating Physician/Supplier Directory, which lists physicians and other providers who accept assignment on all Medicare claims. For a list of providers who accept assignment in your area, call TrailBlazer or visit the TrailBlazer website.

Medicare Supplement Insurance

Medicare supplement insurance fills the gaps between Medicare benefits and what you must pay out-of-pocket for deductibles, coinsurance, and copayments. Therefore, it´s often called Medigap insurance. Medigap policies only pay for services deemed by Medicare as medically necessary, and payments are generally based on the Medicare-approved charge. Some plans offer benefits that Medicare doesn´t, such as prescription drug coverage, emergency care while in a foreign country, and preventive health care services. There are 10 standardized Medigap benefit plans, labeled A through J. Each insurance company must use these same identifying letters. All companies that sell Medigap insurance must offer Plan A, but do not have to offer the other nine plans.

If you bought a Medigap policy before the 10 standardized plans were first required in 1992, you may keep your existing policy. You do not have to switch to one of the 10 standardized plans.

Medigap policies are sold by private insurance companies that are licensed and regulated by the Texas Department of Insurance. Medigap benefits, however, are set by the federal government. The benefits provided by these plans are described in the appendix.

Medicare Select

Medicare Select is a type of Medigap policy that may give you a lower price in return for using only the providers on your insurance company´s network providers list. Medicare Select coverage can be issued by an insurance company or a Medicare health maintenance organization (HMO). If you leave a Medicare Select plan, the company must make available any non-Medicare Select policy it has on the market with comparable or lesser benefits.

Alternatives to Medicare Supplement Insurance

Before you buy a Medigap policy, consider these other options:

Employee Group Plans

If you remain employed after your 65th birthday, you may continue your group health insurance where you work and may not need Medicare Part B or Medigap insurance. Likewise, if you become eligible for Medicare but are covered by your working spouse´s group health insurance, you may not need a Medigap policy.

Retirees who remain on their employers´ health plans or who have health coverage through a union or fraternal organization may not need Medigap coverage. Because health plans work differently, talk to your employer´s benefits coordinator before making a decision about Medigap insurance.

Additional information is available in the Guide to Health Insurance for People with Medicare, which is available from TDI.

Medicare Advantage Plans (formerly known as Medicare+Choice plans)

Depending on where you live, you may have the option to choose between Medicare or a Medicare Advantage plan. If you are in a Medicare Advantage plan, you don´t need a Medigap policy. Medicare Advantage plans provide at least the same benefits as Medicare. There are two different types of Medicare Advantage plans:

• managed care plans, which include HMOs, preferred provider organizations, provider-sponsored organizations, and religious fraternal benefit society plans
• private fee-for-service plans.

Medicare pays a monthly premium to the Medicare Advantage plan to provide your health care. In addition, the plan may require you to pay an additional premium and may charge a copayment each time you use a covered service. To join a Medicare Advantage plan, you must have both Medicare Part A and Part B, not have end-stage renal disease, and live in an area that has a plan. Not all plans are available in all areas of the state. Call Medicare or TDI´s Consumer Help Line to learn whether any plans are available in your area.

Medicare HMOs require you, in most instances, to use only physicians and hospitals in the HMO´s network. A Medicare HMO with a point-of-service option allows you the flexibility to choose your own doctors, but you will have to pay extra. You can generally go to any doctor or provider you want with a private fee-for-service plan and may receive care anywhere in the United States. The doctor and provider, however, must agree to treat you and accept the plan´s payment terms.

If your Medicare Advantage plan terminates its contract in your service area, you are guaranteed the right to purchase any Medigap plan A, B, C, or F offered in Texas without regard to your medical history or condition. Companies may not place any restrictions, such as pre-existing condition waiting periods or exclusions, on these policies. This is called "guaranteed issue." If your Medicare Advantage plan ends services in your area, it must explain to you in writing your options and timeframes to buy a Medigap policy.

Medicaid and Medicare Savings Programs

If your income and assets are below a certain level, you might be eligible for Medicaid. You do not need a Medigap policy if you receive Medicaid because Medicaid pays the gaps in Medicare. Medicaid also includes some prescription coverage.

Medicaid-sponsored Medicare Savings Programs may pay Medicare premiums, deductibles, and coinsurance amounts for eligible Medicare beneficiaries. These programs enable Medicare beneficiaries to apply their savings to cover other expenses or buy more coverage.

The Qualified Medicare Beneficiary (QMB) program, the Specified Low-Income Medicare Beneficiary (SLMB) program, the Qualified Individuals (QI), and the Qualified Disabled Working Individuals (QDWI) are all Medicare Savings Programs.

The federal QMB program pays the Medicare Part B premium and covers all Medicare deductibles and copayments for people with incomes below a certain level. You do not need Medicare supplement insurance if you are in the QMB Program. QDWI pays Medicare Part A premiums. The other plans pay all or part of your Medicare Part B premium.

Your Rights as a Medicare Supplement Consumer

Open Enrollment

Seniors: Medigap companies must sell you a policy - even if you have health problems - if you are at least 65 and apply within six months after enrolling in Medicare Part B. These six months are called your "open enrollment" period. During open enrollment, a company must allow you free choice among all the Medigap plans it offers. You can use your open enrollment rights more than once during this six-month period. For instance, you may change your mind about a policy you bought, cancel it, and still have the right to buy any other Medigap policy, so long as the sale takes place during the six months after you enroll in Medicare Part B.

Even though a company must sell you a policy during your open enrollment period, it may require a waiting period of up to six months before covering your pre-existing conditions. Pre-existing conditions are conditions for which you received treatment or medical advice or recommendations from a physician within the previous six months.

Your right to open enrollment is absolute, even if you wait for several years after you become 65 to enroll in Medicare Part B because of continued employment or other reasons.

Texans with disabilities: In Texas, people under age 65 who receive Medicare because of disabilities have a six-month open enrollment period beginning the day they enroll in Medicare Part B. This open enrollment right is only applicable to Medigap Plan A. Companies selling Medicare supplement insurance in Texas may not deny you a Plan A policy because you have pre-existing conditions. Companies are not required to offer plans B through J to Texans with disabilities, but they may do so if they wish. During the first six months after you turn 65 and are enrolled in Medicare Part B, you will have a right to buy any of the 10 plans. For more information, read TDI´s publication, Insurance for Texans with Disabilities.

Guaranteed Issue Right to Buy a Medicare Supplement Policy

You may have the right to buy a Medigap policy outside of your open enrollment period if you lose or change certain types of health care coverage. In general, your guaranteed issue right to purchase Medigap coverage is limited to plans A, B, C, or F. There are limited time periods for you to purchase a policy and you must provide proof of the loss of your health care coverage. Texans with disabilities also have guaranteed issue rights. For more information, read the Guide to Health Insurance for People with Medicare or call The Texas Department of Insurance.

30-Day "Free Look"

You can return your Medigap policy within 30 days after receiving it and get your money back-with no questions asked. Be sure to keep a record of the date you received the policy. Read the policy as soon as you get it. If you return the policy to the company, use certified mail with a return receipt as proof that it was returned within the 30-day time limit.

Renewability

All Medigap policies are guaranteed renewable. A company cannot cancel your policy or refuse to renew it unless you made intentional material false statements on your application or failed to pay your premium. However, the amount of the premium is not guaranteed. An insurance company may raise your premium as often as once a year on a class basis. In addition, if you have an "attained-age policy," a company may raise your premium on your birthday.

Medicare Supplement Claims

Your doctor and other health care providers must submit Medicare claims to the appropriate carrier or fiscal intermediary for you. In most cases, the carrier or intermediary will send your Medigap claim directly to your insurance company.

Medigap policies won´t pay for services that Medicare does not deem medically necessary.

Therefore, if the carrier or intermediary denies your claim as medically unnecessary, your Medigap company won´t pay it. You have the right to appeal the decision to deny a claim. The appeal process and timeframes to request an appeal are described in your Medicare Summary Notice.

If your Medigap company refuses to pay a claim for a Medicare-approved charge or delays payment of your claims, you may file a complaint with TDI. Texas law requires insurance companies to pay claims promptly.

Group Medicare Supplement Insurance

Your rights with a group Medigap policy are essentially the same as with an individual policy. Because the group might make decisions that are out of your control, you have the following protections:

• If the group changes insurance companies, the new company must offer coverage to everyone previously covered. The new Medigap policy must cover pre-existing conditions that were covered by the old policy.
• If you leave the group, the insurance company must offer to provide unbroken Medigap coverage with an individual policy or continuation of your group insurance.
• If the group cancels its coverage, the insurance company must offer you either an individual policy continuing the benefits you had before or a different policy meeting Texas requirements.

Shopping Wisely for Medigap Insurance

Money-Saving Tips

• The best time to buy a Medigap policy is during your Medicare open enrollment period because companies must sell you any plan they offer without regard to pre-existing conditions.
• Shop around. Standardized benefit plans make price shopping easy. Use the rate guide section of this handbook to compare the prices of the plans that interest you.
• Consider other factors. Price should not be your only consideration. You can learn a company´s complaint record and A.M. Best financial strength rating by calling TDI´s Consumer Help Line. Both are important indicators of the service you can expect from a company. Your family and friends are other sources of information about a company´s customer service. Ask them if they have had any experiences with the companies you are considering.
• Consider your needs. Although it is illegal to sell you more than one Medigap policy, insurers may offer other policies with benefits that may overlap Medigap coverage. These include cancer, specified disease, hospital indemnity, and long-term care policies. Any duplication of benefits must be disclosed in writing. In general, duplicate coverage wastes money because you are paying twice for the same coverage. Before buying, consider your budget and your health care needs.
• Investigate alternatives for prescription drugs. Some drug companies offer free or reduced-cost drugs to people who use prescriptions regularly. Contact Medicare for more information. Also, some companies offer drug discount cards. These companies usually charge a membership fee for you to obtain the discount. Before paying a membership fee find out whether pharmacies in your area accept the discount car and whether your prescriptions are covered by the card. You may not need a discount card if your prescriptions are available for a similar price at a discount pharmacy or if your local pharmacy has a discount program. Neither TDI nor the Texas Board of Pharmacy regulates drug discount cards.

Protect Yourself

• Read what you are asked to sign before you sign it. Never sign a blank application form.
• If an agent tries to rush you, be suspicious! Tell the agent you need more time.
• If you buy insurance by mail, ask if the company has a local agent or a toll-free number that you can call if you have questions.
• Try to buy from an agent you know and trust. Ask questions and take notes when you talk to an agent. These could help you later if there is a dispute over what you were told about a policy.
• Make sure the agent and company are licensed. You can verify company and agent licenses by calling TDI´s Consumer Help Line.
• Don´t buy a policy on the agent´s first visit. Invite someone you trust to be present during the second visit. An agent shouldn´t object.
• Answer all questions on the application accurately. If an agent helps you complete the application, make sure the information is correct and complete before you sign. Omitting or falsifying information could cause the company to deny your claims or cancel your policy.
• Do not pay cash or make a check out to an individual agent. Always pay by check or money order so you have a clear record of payment. Make checks payable only to the insurance company or insurance agency. Insist on a receipt signed by the agent on the company´s letterhead.
• Before making a lump-sum payment, ask the agent or company about reimbursement of unearned premium. This is especially important during the open enrollment period when you have the right to change companies.
• Be sure you have the names and addresses of the agent and the insurance company. Know how to contact the agent and the company if you need help.

Unfair Practices

Agents and companies who engage in any of the following activities are breaking the law:

• Knowingly making misleading statement that causes you to drop a policy and buy a replacement from another company. This is called twisting.
• Using high-pressure tactics, including the use of force, fright, or threat to pressure you into buying a policy.
• Obtaining sales leads through advertising that hides the fact that an agent or company may try to sell you insurance. This is called cold lead advertising.
• Using misleading advertisements made to look like mail from the government by using eagles or similar graphics or a return address with a name that sounds like an official government agency or bureau.
• Posing as a representative of Medicare or a government agency.
• Selling you a Medigap policy that duplicates Medicare benefits or health insurance coverage you already have. An agent is required to review and compare your other health coverages.
• Suggesting that you falsify an application.

If you believe that an agent or company has used unfair and illegal practices with you, file a complaint with TDI.

How to Use the Guide

The companies listed are licensed to sell their plans throughout Texas. Companies selling Medicare Select, however, will sell by specific areas of the state. For information about a company´s plans, call the company at the toll-free number listed in the guide or call one of the company´s agents.

Check your phone book for the phone numbers of agents in your area. If a company has a website, the address is included in the guide.

The rate guide includes only companies that are actively selling Medigap plans. Your company may no longer be selling the plan you purchased.

Appendix

The Appendix describes the basic benefits offered in plans A through J and the additional benefits offered in plans B through J.

Organization of the Rate Information

All the companies that sell Plan A are listed together in alphabetical order. The company´s rates for ages 65, 70, and 75 are shown. After the list of companies offering Plan A is an alphabetical list of companies that sell Plan B policies. Separate lists follow for companies that sell plans C through J. The number of companies selling each plan varies. All companies must offer Plan A, but they do not have to offer any of the other plans. The guide identifies companies that offer a high-deductible option for plans F and J. Following the tables for the 10 standardized plans is a table with information about Plan A rates for people under age 65 with disabilities. Group policies are listed at the end of each individual plan list.

Key to the Rate Tables

Benefits: The chart on the inside back cover summarizes the benefits provided in each of the 10 plans. An explanation of the standard benefit plans is provided in the appendix.

Rates: The rates shown are the annual premiums you might expect to pay in one lump sum for a year. Rates are given for the lowest annual premium the company charges and the highest annual premium. The rates listed are provided by the companies and are only estimates. Your premium will likely vary. The exact premium you will pay is based on a variety of factors. Rates vary if you pay monthly or quarterly. If you have an issue-age policy, your premiums are based on your age at the time you buy. Companies may increase issue-age policy premiums once during your first year of coverage. After that, the company may not increase the premium for 12 months. If you have an attained-age policy, your premium will increase on your birthday, in addition to any rate increase during the first 12 months. Some companies base rates on the ZIP code in which you live. To learn the exact premium you would pay, call your agent or the company. Medigap rates are set by insurance companies, and are subject to approval by the Texas Department of Insurance. Companies can obtain approval for rate increases at any time during the year.

Age: Rates are shown for people buying at ages 65, 70, and 75. You should compare costs at different ages over time. For people under 65 with disabilities, one price is shown.

Pre-existing conditions: In most cases, an insurance company may impose a waiting period of up to six months before covering pre-existing medical conditions. The amount of time you must wait before a policy covers pre-existing conditions is shown in the column labeled "Pre-Ex-Wait" in the rate tables.

However, if you move from one Medicare supplement policy to another, you get credit for the time you were covered under your prior policy. If you have had a policy for at least six months, your new policy will not have a waiting period for pre-existing conditions. If you are age 65 or over, have had an employer health insurance plan for at least six months, and if you purchase a Medigap policy within 63 days of leaving your employer plan, you should not have a waiting period for pre-existing conditions.

Group policies: You must be a member of a particular group, association, or organization to get group insurance coverage. In general, rates for group coverage are lower than rates for individual policies. Group policies are listed by plan after the individual policies.

Disability Under Age 65 - Other Plans: This table lists companies that offer additional plans to people under age 65 with disabilities. Since Texas law requires companies to offer only Plan A, people with disabilities must meet a company´s guidelines to be eligible for any of the additional plans the company offers.

Notes: Rates and policies vary according to several factors. Each one is given a different symbol in the guide:

Appendix-Summary of Medicare Supplement Benefits

All Medigap plans provide these basic benefits:

• Your daily copayments for hospitalization expenses from the 61st through the 90th day of any Medicare benefit period.
• Medicare Part A copayments for any hospital confinement beyond the 90th day in a benefit period, up to an additional 60 days during your lifetime. (These are your inpatient reserve days. You may use these days when you require more than 90 days in the hospital during a benefit period. When you use a reserve day, it is subtracted from your lifetime total and cannot be used again.)
• All Medicare-eligible hospital charges for a period of up to 365 additional days during your lifetime after you have exhausted all your Medicare hospital benefits.
• The reasonable cost of the first three pints of blood, or their equivalent, under Medicare Parts A and B.
• Your 20 percent Part B coinsurance for Medicare-eligible expenses for medical services - including doctor bills, hospital or home health care, and copayments for services under the prospective payment system - after you have met your Part B deductible.

Additional Benefits in Plans B through J

Plans B through J offer the following additional benefits:

• Skilled nursing facility care: Covers actual billed charges up to your coinsurance amount from the 21st day through the 100th day in a benefit period for post-hospital skilled nursing facility care eligible under Medicare Part A. This is not custodial care. (Available on plans C through J.)
• Part A deductible: Pays the entire Medicare Part A deductible amount per benefit period. (Available on plans B through J.)
• Part B deductible: Pays the entire Medicare Part B deductible amount per calendar year. (Available on plans C, F, and J.)
• Medicare Part B excess doctor charges: Pays 80 percent or 100 percent of the excess fees, which are limited by law to 15 percent above the Medicare approved amount. If most of your doctors take Medicare assignment, you may not need this benefit. (100 percent coverage in plans F, I, and J; 80 percent coverage in plan G.)
• Foreign travel emergency: Pays 80 percent of the billed charges for foreign emergency care that Medicare would have covered if provided in the United States. Care must begin during your first 60 days outside the United States. Calendar year deductible is $250. Lifetime maximum benefit is $50,000. (Available on plans C through J.)
• At-home recovery: Pays for doctor-approved, short-term, at-home assistance with activities of daily living while recovering from an illness, injury, or surgery. Limited to seven visits per week by a qualified care provider. Pays actual charges up to $40 per visit, with a maximum of $1,600 per year. (Available on plans D, G, I, and J.)
• Preventive medical care: Includes an annual physical examination, certain lab tests, and other preventive measures deemed appropriate by your physician. Maximum benefit is $120 per year. (Available on plans E and J.)
• Prescription drug benefits:
  1. Basic: Pays 50 percent of your outpatient prescription drug charges after you meet a deductible of $250 per calendar year. To receive the maximum benefit of $1,250 per calendar year, your prescriptions would have to cost $2,750. (Available on plans H and I.)
  2. Extended: Same as the basic prescription benefit but with a maximum benefit of $3,000 per calendar year. Your prescription costs must be at least $6,250 for you to get the maximum benefit. People with high prescription or medical costs will probably not be able to get this plan unless they apply during their six-month open enrollment period. (Available on Plan J.)
• High deductibles: Offers the same benefits, but you pay a lower premium in exchange for paying a higher deductible. A deductible is the amount you pay out of pocket before the policy pays. The deductible amount is set by Medicare and can change each year. In addition to meeting the high deductible, you must also meet the deductible for foreign travel emergency and, if you have Plan J, the deductible for prescription drugs. (Available on plans F and J.)

Contact us today, for more information!

Not all policies and product features are available in all states.
This is not an offer or solicitation in any jurisdiction where the policies are not approved for sale.

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