You’ve finally got your Medicare all setup and you breathe a sigh of relief. Then whammo – a slew of claims denials flood your mailbox. Post-enrollment Medicare mistakes sometimes happen, and in this post, I’m going to show you how to avoid them.
First, let’s look at an example:
A long-time client sent me an email about $1500 in unexpected charges. He had changed drug plans during the Annual Election Period to a new plan we found that would save him about $500 annually next year on his prescription drugs. (He did not change his Medigap plan.)
Even though the annual election period does not affect Medigap plans, it’s not unusual for all the annual Part D plan changes to confuse people. Somehow he started using his new Part D drug plan card when attempting to purchase replacement parts for his CPAP machine.
All the bills were denied of course because Part D doesn’t cover durable medical equipment. That falls under Part B and would have been covered entirely by Medicare and his supplement if he had presented the right insurance card.
Fortunately, he knew to call us when he received a denial and an unexpected bill. Our Client Service Team quickly stepped into help him straighten it out and get the bills to the right place. But these are the kinds of things that constantly happen to Medicare beneficiaries. Many who don’t have an insurance agent on their policies are left to fix these Medicare mistakes on their own.
Here are a few of the most common Medicare mistakes we’ve seen over the years so that you can avoid them.
Failing to Pay Your Part B premiums
Many people today work well past age 65, and most of these people delay their Social Security income benefits because they still have working income. Since Medicare can’t deduct your Part B premiums from your Social Security check in that situation, they send a quarterly invoice to you instead.
With the mountain of mail that Medicare beneficiaries get every day from insurance companies, it can be very easy to overlook a bill from Social Security. Unfortunately, the result is catastrophic.
When Social Security revokes your Part B for non-payment, they notify your Medigap carrier, who promptly cancels your Medigap plan. Now you are left with no coverage for outpatient services, which includes doctor visits, lab-work, medical equipment, surgeries, chemotherapy, dialysis and many other expensive services.
What’s worse is that you then must wait until the next General Enrollment Period (GEP) to enroll. The GEP runs from January 1st – March 31st each year. Though you can enroll during this period, your coverage won’t start until the following July.
Let’s think about this. If you failed to pay your bill in April, you would wait 8 months to reapply in January. Then that new Part B coverage wouldn’t start for yet another 7 months. That would be 15 months without coverage for anything except your Part A hospital related services.
A serious illness or injury during this uncovered time could result in thousands of dollars of unpaid medical expenses. We want to avoid that at all costs.
Not Notifying Medicare That You’ve Left Employer Coverage
A quick call to Medicare to confirm your primary coverage can prevent denials and hassles.
In a perfect world, your former employer would accurately notify Medicare that you are no longer working there. Then Medicare would know that it is now your primary insurance, and it would begin to pay as primary.
This works like it should about 95% of the time. However, every year there are a handful of situations where the employer fails to properly notify Medicare that you have left your job. Your doctor bills Medicare based on your presenting your Medicare card at the time of service. Medicare will promptly deny all of those claims because they believe the bills should have gone to your employer insurance first.
On occasion, we’ve even seen instances where the next year the employer again notifies Medicare that they are still covering you. This results in a whole new round of denied claims.
Presenting your Provider with the Wrong ID Card – Part 1
This one has several versions of easy Medicare mistakes. If you have chosen Medicare as your primary coverage then you will present your Original Medicare card (and Medigap card) to your provider at the time of service
If you enrolled in a Medicare Advantage plan though, that plan pays INSTEAD OF Medicare. People don’t realize this and they give their doctor their Medicare card by mistake. What does Medicare do? Deny all of the claims because those bills should have gone to your Medicare Advantage Company.
I’ve also seen this one where a Medicare beneficiary is rushed to the hospital. His or her spouse digs through their wallet and pulls out the Medicare card for the hospital. The hospital sends all the bills to Medicare because they assume the spouse is presenting the correct coverage.
It’s particularly awful because treatment in the hospital can be billed from a variety of places – radiology, anesthesiology, physical therapy, the hospital itself. Each of those bills then has to be corrected separately which can take you several hours by phone to straighten out.
My Best Tip: If enrolled in Medicare Advantage, put your red, white and blue Medicare card away in a safe place. You will not be using it unless you later decide to drop your Medicare Advantage plan. Give your providers only your Advantage card.
Presenting your Provider with the Wrong ID Card – Part 2
The second version of “id card mistakes” that we see happen often is that beneficiaries will present their Medicare card for drug-related expenses, or vice vera, their Part D card for non-drug related expenses. This is what happened to my client that I mentioned in the first paragraph of this post.
Think of your Part D drug plan as a pharmacy card. You only use it at the pharmacy. So unless you are picking up a retail prescription, you generally won’t be presenting your Part D card for payment.
So what should you do about things like test strips for diabetes or replacement parts for insulin pumps or CPAP machines? These fall under Part B. You will present your Medicare card if you have Original Medicare, or if you are enrolled instead in an Advantage plan, you’ll present your Advantage plan ID card. See Medicare’s website to find a list of approved suppliers in your area. We look them up all the time for our clients. It’s easy to find good vendors.
My Best Tip: Your Part D plan will usually have the word RX somewhere on the card. This is the one you should present at the pharmacy when purchasing prescriptions.
Paying your Part B Deductible to Your Provider Before Medicare has Processed the Claim
Medicare Part B has a deductible of $183 in 2017. This goes up a little bit in most years. There are several popular Medigap plans, such as Plan G and Plan N where you agree to pay the annual Part B deductible.
Do NOT pay this to your provider at the time of treatment, even if he asks for it. The proper procedure is for your doctor to see you first, then send the bill to Medicare. Medicare will pay all but the deductible to your provider. Your provider will then bill you for the $183 due. The doctor does not need to collect the deductible from you at the time of service. Here’s why:
It’s very common for people to have lab-work on the same day of their doctor appointment, or sometimes a few days before that appointment. When Medicare receives the bills from your lab facility and your doctor’s office, it will apply the deductible to the first one processed. So Medicare might pay 100% of your doctor’s office bill, and apply the deductible to the bill from the lab facility. Now the lab facility will bill you for $183.
Your doctor’s office, on the other hand, will not only have your $183, but it will also get paid by Medicare. Doctor’s offices do not like to give the money back to you. They often will want proof that you’ve paid this deductible elsewhere.
This can be even worse if your first outpatient service of the year happens as part of a hospital stay. You will have no idea which provider will be the first bill that Medicare processes. Therefore do not pay the deductible until after Medicare has processed the claim.
My Best Tip: Tell your doctor you are aware a deductible is owed, and they can bill you for it. Then when Medicare has paid the claim and sent you its notice, you can pay the doctor what he is owed. I promise this will help you avoid a monster headache.
Wishful Thinking on Preventive Care
Wishful thinking on Medicare’s preventive care benefit can cost you a bundle.
Medicare has a number of great preventive care benefits which are fully covered. Medicare pays them 100% for you. This includes screenings for cardiovascular disease, diabetes, and aneurysms. It also includes common cancer screenings such as colonoscopy, mammograms, and tests for lung cancer. Furthermore, you will have coverage for vaccine coverage, a yearly wellness visit, bone mass measurements and more. You can find a full list on Medicare’s site.
What the preventive care does NOT include is a $6000 Executive physical from the Cooper clinic or Mayo clinic. Your local hospital might offer a really great full body exam complete with stress testing and an EKG and nutrition counseling session. None of that is likely to be covered by Medicare. Your primary care doctor will know the proper billing codes for what is covered by Medicare. Those are the tests for which you can expect coverage. Anything that you do beyond that is on your own dime.
Keep in mind also that while certain screenings may be covered, related services may not be. We see this all the time on Medicare Advantage plans, where a colonoscopy might be covered, but the anesthesiologists’ services during that exam are separate.
My Best Tip: Get your preventive care from your primary care doctor. If you seek out additional preventive/wellness care from another facility, confirm with them ahead of time as to what you will owe.
Failure to Review Your Annual Notice of Change
Every year here in the fall, we run a series of webinars for our existing clients about the upcoming Annual Election Period. All of our existing clients are invited and we publicize it via email ahead of time. The reason we go so far is simple. People forget what they are supposed to do in relation to their drug plan each year.
Medicare has an annual election period in the fall, sometimes also called the open enrollment period. It runs from October 15 – Dec. 7th. This is when you can make changes to your Part D drug plan or your Medicare Advantage plan if enrolled in one.
The election period exists because the benefits in those plans change from year to year. Your premium might be going up or your drug formulary may be changing. Your current carrier will send you a letter in September called the Annual Notice of Change.
You should review this letter thoroughly EVERY YEAR.
Unfortunately, all the insurance companies will also market you to death around this same time. This causes some people to mistakenly throw out their Annual Notice of Change letter. Then January rolls around and they go to fill their $300 diabetes medication and find out it’s not covered anymore. By then it’s too late to change.
Reviewing the ANOC letter is a critical piece of staying cost-effective with your Medicare benefits. Since Part D plans and Medicare Advantage plans lock you in for the calendar year, you can’t afford to miss reading about upcoming changes.
My Best Tip: Set a reminder on your calendar every year for September 30th. Sit down with your Annual Notice of Change packet and compare the plan’s current benefits with the upcoming benefits. All of this info will be laid outside by side for you in the packet. If you see a big premium increase or an important medication being dropped, call your insurance agent. We can help you evaluate other options for the coming year.
While Medicare mistakes happen, the tips in this post should help you to avoid the most common problems. Since even the most prepared person might encounter hiccups, it’s in your best interest to work with an insurance agent who knows what they are doing when it comes to Medicare. Our agency offers this with our amazing Client Service Team who are accessible to you right from Day One. Wouldn’t it be nice to have someone on your side with Medicare?