Railroad Retirement Board
Medicare for Railroad Families
April 2011
The Federal Medicare program provides hospital and medical
insurance protection for railroad retirement annuitants and their families,
just as it does for social security beneficiaries. Medicare has the
following parts:
· Medicare
Part A (hospital insurance) helps cover inpatient care in hospitals and
skilled nursing facilities (following a hospital stay), some home health care,
and hospice care.
Part A is financed through payroll taxes paid by employees and employers.
· Medicare
Part B (medical insurance) helps cover medically-necessary services like doctors’
services and outpatient care. Part B also helps cover some preventive
services. Part B is financed by premiums paid by participants and by
Federal general revenue funds.
· Medicare
Part C (Medicare Advantage Plans) is another way to get Medicare
benefits. It combines Part A, Part B, and sometimes, Part D (prescription
drug) coverage. Medicare Advantage Plans are managed by private insurance
companies approved by Medicare.
· Medicare
Part D (Medicare prescription drug coverage) helps cover prescription
drugs.
The
following questions and answers provide basic information on Medicare
eligibility and coverage, as well as other information on the Medicare program.
1.
Who is eligible for Medicare?
All
railroad retirement beneficiaries age 65 or over and other persons who are
directly or potentially eligible for railroad retirement benefits are covered
by the program. Although the age requirements for some unreduced railroad
retirement benefits have risen just like the social
security requirements, beneficiaries are still eligible for Medicare at age
65.
Coverage
before age 65 is available for disabled employee annuitants who have been
entitled to monthly benefits based on total disability for at least 24 months
and have a disability insured status under social security law. There is
no 24-month waiting period for those who have ALS (Amyotrophic Lateral
Sclerosis) also known as Lou Gehrig’s disease.
If
entitled to monthly benefits based on an occupational disability, and the
individual has been granted a disability freeze, he or she is eligible for
Medicare starting with the 30th month after the freeze date or, if
later, the 25th month after he or she became entitled to monthly
benefits. If receiving benefits due to occupational disability and the
person has not been granted a disability freeze, he or she is generally
eligible for Medicare at age 65. (The standards for a disability freeze
determination follow social security law and are comparable to the medical
criteria for granting total disability.)
Under
certain conditions, spouses, divorced spouses, surviving divorced spouses,
widow(er)s, or a dependent parent may be eligible for
Medicare hospital insurance based on an employee’s work record when the spouse,
etc., turns age 65. Also, disabled widow(er)s
under age 65, disabled surviving divorced spouses under age 65, and disabled
children may be eligible for Medicare, usually after a
24-month waiting period.
Medicare
coverage at any age on the basis of permanent kidney failure is also available
to employee annuitants, employees who have not retired but meet certain minimum
service requirements, spouses, and dependent children who suffer from permanent
kidney failure requiring hemodialysis or a kidney
transplant. The Social Security Administration has jurisdiction of
Medicare for those eligible on the basis of permanent kidney failure.
Therefore a social security office should be contacted for information on
coverage for kidney disease.
2.
How do persons enroll in Medicare?
If a retired
employee or a family member is receiving a railroad retirement annuity,
enrollment for both Medicare Part A and Part B is generally automatic and
coverage begins when the person reaches age 65. For beneficiaries who are
totally and permanently disabled, both Medicare Part A and Part B start
automatically with the 30th month after the beneficiary became
disabled or, if later, the 25th month after the beneficiary became
entitled to monthly benefits. Even though enrollment is automatic, an
individual may decline Part B, if so desired; this does not preclude him or her
from applying for Part B at a later date. Premiums may be higher if
enrollment is delayed. (See question #7 for more information on delayed
enrollment.)
If an
individual is eligible for but not receiving an annuity, he or she should
contact the nearest Railroad Retirement Board (RRB) office before attaining age
65 and apply for both Part A and Part B. (This does not mean that the
individual must retire if presently working.) The best time to apply is
during the 3 months before the month in which the individual reaches age
65. He or she will then have both Part A and Part B protection beginning
with the month age 65 is reached. If the individual does not enroll for
Part B in the 3 months before attaining age 65, he or she can enroll in the
month age 65 is reached or during the next 3 months, but there will be a delay
of 1 to 3 months before Part B is effective. Individuals who do not
enroll during this Initial Enrollment Period may sign up in any General
Enrollment Period (January 1 – March 31 each year). Coverage for such
individuals begins July 1 of the year of enrollment.
3.
What is covered by Part A (hospital insurance) of the Original Medicare
Plan, the traditional fee-for-service plan available nationwide?
Medicare Part A is designed to help pay the bills when an
insured person is hospitalized. The program also provides payments for
required professional services in a skilled nursing facility (but not for
custodial care) following a hospital stay, some home health care, and hospice
care.
There is a limit on how many days of hospital or skilled
nursing care Medicare helps pay for in each “benefit period.” A benefit
period begins the day a patient goes to a hospital or skilled nursing
facility. It ends after a person has not received any hospital or skilled
nursing care for 60 days in a row. There is no limit to the number of
benefit periods a person can have.
When a patient receives Part A benefits, he or she is
billed by the hospital only for the deductible amount, any coinsurance amount
and any noncovered services. The remainder of
the bill from the hospital, as well as bills for services in skilled nursing
facilities or home health visits, is sent to Medicare to pay its share.
Benefits are ordinarily paid only for services received in
the
4.
What are the Medicare Part A deductible and
coinsurance charges in 2011?
For
the first 60 days in a benefit period, a Medicare patient is responsible for
paying a deductible which, for 2011, is the first $1,132 of all covered
inpatient hospital services. The daily coinsurance charge that a Medicare
beneficiary is responsible for paying for hospital care for the 61st
through the 90th day is $283 in 2011. If a beneficiary uses
“lifetime reserve” days, he or she is responsible for paying $566 a day for
each reserve day used in 2011. Lifetime reserve days are an extra 60
hospital days a beneficiary can use if illness keeps him or her in the hospital
for more than 90 days; a beneficiary has only 60 reserve days during his or her
lifetime and the beneficiary decides when to use them.
In
addition, the daily coinsurance charge a beneficiary is responsible for paying
for care in a skilled nursing facility for the 21st through the 100th
day is $141.50 in 2011.
5.
What are some of the services covered by Part B (medical insurance) of
the Original Medicare Plan?
Part B covers
physicians’ services, outpatient medical and surgical services, and many other
medical and health services in and out of medical institutions. More
information on specific services is available by calling 1-800-MEDICARE
(1-800-633-4227) or by visiting www.medicare.gov.
There
is an annual deductible for Part B services ($162 in 2011). After the
deductible is paid, Medicare will generally pay 80 percent of the approved
charges for covered services during the rest of the year; the beneficiary is
responsible for paying the remaining 20 percent of the cost.
Claims for Part B benefits filed on behalf of railroad
retirement beneficiaries in the Original Medicare Plan are generally handled by
Palmetto GBA on a nationwide basis. Palmetto GBA is a private company
that contracts with the RRB and Medicare to pay Part B claims for railroad
retirement beneficiaries.
Palmetto GBA
Railroad Medicare Part B Office
1-800-833-4455
Part B generally does
not pay for services outside the
6.
What is the Medicare Part B premium in 2011?
The standard premium is $115.40 in 2011. However, most Medicare beneficiaries did not see an
increase in their monthly Part B premiums because of a “hold-harmless”
provision in current law. Monthly premiums for beneficiaries protected by
this provision continue to be $96.40 or $110.50, the same monthly amount that
they paid in 2010.
Monthly
premiums for some beneficiaries are greater, depending on a beneficiary’s or
married couple’s modified adjusted gross income. The income-related Part
B premiums for 2011 ($115.40 plus a monthly adjustment amount) are $161.50,
$230.70, $299.90, or $369.10, depending on the extent to which an individual
beneficiary’s income exceeds $85,000 (or a married couple’s income exceeds
$170,000), with the highest premium rates only paid by beneficiaries whose
incomes are over $214,000 (or $428,000 for a married couple). Some
individuals also pay premium surcharges because they enrolled late for Part B.
7. How much can Medicare Part B premiums increase for delayed
enrollment?
Premiums for Part B are increased 10 percent for each
12-month period the individual could have been, but was not, enrolled.
However, individuals age 65 or older who wait to enroll in Part B because they
have group health plan coverage based on their own or their spouse’s current
employment may not have to pay higher premiums because they may be eligible for
special enrollment periods. The same special enrollment period rules
apply to disabled individuals, except that the group health insurance may be
based on the current employment of the individual, his or her spouse, or a
family member.
Individuals deciding when to enroll in Medicare Part B must
consider how this will affect eligibility for health insurance policies which
supplement Medicare coverage. These include “Medigap”
insurance and prescription drug coverage and are explained in the answers to
questions 8 through 11.
8. What is Medigap insurance?
Many private insurance companies sell insurance to help pay
for services not covered by the Original Medicare Plan. This kind of
insurance is called “Medigap” for short.
Policies may cover deductibles, coinsurance, copayments,
health care outside the
When someone first enrolls in Medicare Part B at age 65 or
older, he or she has a 6-month “Medigap open
enrollment period.” During that time, the individual has a right to buy
the Medigap policy of his or her choice regardless of
any health problems. The company cannot refuse a policy or charge the
individual more than all other open enrollment applicants. If an
individual does not buy a policy when first eligible, the cost may go up or the
desired policy may not be available.
More detailed information about Medigap
policies can be found in the publication Choosing a Medigap
Policy: A Guide to Health Insurance for People with Medicare, available by
calling the Medicare toll-free number 1-800-633-4227 or at www.medicare.gov.
9.
Do Medicare beneficiaries have choices available for receiving health
care services?
Yes. Under the
Original Medicare Plan, a beneficiary can see any doctor or provider who
accepts Medicare and is accepting new Medicare patients, or a beneficiary can
choose a Medicare Advantage Plan (Part C). In limited instances, other
Medicare Health Plans may be available. To find out which plans are
available in an area, beneficiaries should go to www.medicare.gov or they can
call
1-800-633-4227.
10.
What is Medicare Advantage?
Medicare Advantage Plans combine Medicare Part A and Part B
coverage, and are available in most areas of the country. A beneficiary
must have both Medicare Part A and Part B to join a Medicare Advantage Plan,
and the individual must live in the plan’s service area. Medicare
Advantage Plan choices include regional preferred provider organizations (PPOs), health maintenance organizations (HMOs), private
fee-for-service plans and others. A PPO is a plan under which a
beneficiary uses doctors, hospitals, and providers belonging to a network;
beneficiaries can use doctors, hospitals, and providers outside the network for
an additional cost. Under a Medicare Advantage Plan, a beneficiary may
pay lower copayments and receive extra
benefits. Most plans also include Medicare prescription drug coverage
(Part D).
For those in a Medicare Advantage Plan, information on
out-of-pocket cost is available by calling 1-800-633-4227 or by going to
www.medicare.gov.
11.
How do Medicare prescription drug plans work?
Medicare
offers voluntary insurance coverage for prescription drugs (Part D) through
Medicare prescription drug plans and other health plan options.
Medicare contracts with private companies to offer
beneficiaries prescription drug coverage through a variety of options, with
different covered prescriptions and different costs. Beneficiaries pay a
monthly premium (averaging about $32 in 2011), a yearly deductible (up to $310
in 2011) and part of the cost of prescriptions. Those with limited income
and resources may qualify for help in paying some prescription drug costs.
Beginning in 2011, the Affordable Care Act requires some
Part D beneficiaries to also pay a monthly adjustment amount, depending on a
beneficiary’s or married couple’s modified adjusted gross income. The
Part D income-related monthly adjustment amounts are $12.00, $31.10, $50.10, or
$69.10, depending on the extent to which an individual beneficiary’s modified
adjusted gross income exceeds $85,000 (or a married couple’s income
exceeds $170,000), with the highest amounts only paid by beneficiaries whose
incomes are over $214,000 (or $428,000 for a married couple).
To enroll, individuals must have Medicare Part A or Part
B. (They are also required to live in the prescription drug benefit
plan’s service area.) Beneficiaries can join during the period that
starts 3 months before Medicare coverage starts and ends 3 months after the
first month of Medicare coverage. There may be a higher premium if an
individual doesn’t join a Medicare drug plan when first eligible, and he or she
does not have other prescription drug coverage that, on average, covers at
least as much as standard Medicare prescription drug coverage. In most
cases, there is no automatic enrollment to get a Medicare prescription drug
plan. Individuals enrolled in Medicare Advantage Plans will generally get
their prescription drug coverage through their plan.
More
information about Medicare prescription drug plans, as well as free
personalized information, is available online at www.medicare.gov, or by
calling the Medicare toll-free number, 1-800-633-4227.
In addition, free personalized counseling is available from the local State
Health Insurance Assistance Program (SHIP) and other local and community-based
organizations.
Public Affairs 312-751-4777
Posted: 04/11/11