Changes in Medicare for 2011

Updated November 12, 2014.

The Affordable Care Act has made several changes in Medicare for 2011 that may affect you whether you are in the Original Medicare program or have a Medicare Advantage plan. The following is an overview of the coming changes that are effective on January 1, 2011.

Cost and Availability

As a cost-saving measure, Medicare will reduce payment to Medicare Advantage plans and no longer allow plans to operate unless they use a network of health care providers.

This may impact you in several ways:

You will continue to receive all basic Medicare benefits.
Your Advantage plan will most likely increase your monthly premium and some out-of-pocket expenses.
Your Advantage plan may eliminate or decrease extra benefits not covered by Medicare, such as eyeglasses and membership in exercise clubs.
If you were in an Advantage fee-for-service plan, you will need to switch to an Medicare Advantage HMO or PPO.

Additionally, each state will have fewer Part D plans available. Most insurance companies that offer drug coverage will have two plans available, one with a low premium and high out-of-pocket expenses and one with a high premium and low out-of-pocket expenses.

Cost of Preventive Services

You will not be required to pay a deductible or coinsurance for most preventive services. Medicare defines preventive services as health care to prevent illness or detect illness at an early stage, when treatment is likely to work best. Examples of preventive services include flu shots, testing for diabetes and high cholesterol, and procedures to screen for cancer such as Pap tests and mammograms.

These services have no cost sharing even if you do not have Medicare Supplement insurance. However, without gap insurance, you may be responsible for a 20% coinsurance for your doctor’s office visit.

New Yearly Wellness Exam

Previously, Medicare only paid for one wellness exam in the first six months after you enrolled. Starting in 2011, Medicare will cover two types of physical exams – one when you are new to Medicare and one each year thereafter. According to Medicare:

The “Welcome to Medicare” physical exam is a one-time review of your health, education and counseling about preventive services, and referrals for other care if needed. Medicare will pay for this exam if you get it within the first 12 months you have Medicare Part B.
The “Yearly Wellness” exam is covered if you have had Medicare Part B for longer than 12 months. This visit is intended to develop or update your personalized prevention plan based on your current health and risk factors. Medicare will pay for this exam once every 12 months.

Durable Medical Equipment (DME)

If you live in certain areas, you may have to get your DME (such as walkers, wheelchairs, and oxygen equipment) from specific suppliers. This program will help save you and Medicare money and make sure that you get quality equipment and supplies.

In all areas of the U.S., you must get your covered DME, supplies, and replacement or repair services from a supplier approved by Medicare. However, in some areas of the country for certain items, Medicare requires that you use specific suppliers. If you do not, Medicare will not pay for the item and you may have to pay the full price out-of-pocket.

This program saves money through a competitive bidding process and will start on January 1, 2011 in the following 11 states:

California
Florida
Indiana
Kansas
Kentucky
Missouri
North Carolina
Ohio
Pennsylvania
South Carolina
Texas

For a list of approved Medicare suppliers and the specific covered items visit the Medicare Supplier Directory.

Medicare Part D Prescription Drug Coverage Gap

If you reach the coverage gap, or donut hole, in your Medicare Part D prescription drug coverage, you may qualify for savings on brand-name and generic drugs.

If you reached the coverage gap in 2010, you should have received a one-time $250 rebate check to help cover the costs of your drugs.

If you reach the donut hole in 2011, you will get a 50% discount on brand-name prescriptions drugs at the time you purchase them. This discount only applies to brand-name medications that are on your drug plans formulary, or approved drug list. Your plan may also offer additional savings on some generic drugs.

A Tip from Dr. Mike: Your brand-name savings actually may be a little less than 50%. Your pharmacist gets paid a small amount for filling the prescription, which may lower your discount to somewhere between 46% and 49%. For example: Mr. Smith takes a medication that costs $200 every month. When he has this prescription filled, instead of paying $100 he will need to pay $103 to cover the cost of filling his prescription.

New Dates to Change Your Medicare Plan

Medicare has an open enrollment period during which you can change your health or prescription drug coverage. Traditionally, the Medicare annual open enrollment period started on November 15 and ended on December 31. However, Medicare has made some changes for 2011, including:

Change in Open Enrollment Dates
In the fall of 2011, the annual open enrollment period dates have been changed to give you more time to select and join a Medicare health plan or prescription drug plan. The new enrollment period will start on October 12, 2011 and end on December 7, 2011. Any changes you make during this period will be effective on January 1, 2012.

Making Changes to Your Medicare Advantage Plan Coverage after December 31
Between January 1, 2011 and February 14, 2011, if you are in a Medicare Advantage plan you can leave your plan and switch to Original Medicare. If you decide to switch to Original Medicare during this period, you will have until February 14 to also join a Medicare Prescription Drug Plan to add drug coverage. Your coverage will begin the first day of the month after the plan gets your enrollment form.

During this period, you can only switch from your Medicare Advantage plan to Original Medicare, you cannot do any of the following: