Medicare’s Changes Merit a Close Watch

Many consumers will need a scorecard to keep up with the rapid changes occurring in Medicare this year, and the latest revisions offer mixed news for 35 million Americans enrolled in the giant federal medical plan.

On one hand, the government is expanding coverage this year for some people with serious health problems, such as cancer and diabetes, and renewing efforts to reach low-income individuals who need help paying Medicare premiums. It is also promising to remove some hurdles that were making it difficult for people with Alzheimer’s disease to access medical care. But other changes will make it more difficult for Medicare enrollees to switch back and forth between the traditional Medicare program and HMOs.

The coverage changes are being led by Tom Scully, director of the Centers for Medicare and Medicaid Services, who has announced a drive “to make the latest effective technology available� to Medicare recipients. If successful, the effort will assure that people enrolled in Medicare, many of whom live on modest fixed budgets, will have available the same state-of-the-art equipment and treatments found in the best private health insurance plans.

One key change is that Medicare will begin paying for major, sophisticated diagnostic tools for the detection of breast cancer, which strikes 90,000 Medicare beneficiaries a year. The program will cover Positron Emission Tomography, or PET, a scanning system that shows cross-sectional images of biological activity in tumors or lesions. It can detect the disease when X-rays appear to be normal. The technology gives patients and doctors “potentially lifesaving information not provided by traditional imaging,� said Health and Human Services Secretary Tommy G. Thompson.

Medicare also will cover the cost of “image guidance,� which uses ultrasound to determine where to insert a needle for a biopsy of the breast. The ultrasound technique is a less-invasive alternative to surgical biopsy, in which a piece of tissue is surgically removed. Another change is that Medicare, which normally excludes coverage for routine foot care, will now pay for two foot exams a year for diabetics. The coverage will be available to people who have peripheral neuropathy, a nerve condition limiting the ability to feel the pains that might signal a foot injury. Many diabetics have undetected foot injuries that sometimes lead to amputations.

Also, Medicare will now pay for consultations with professional dietitians for patients suffering from diabetes or kidney disease. The dietitians will prepare an individual diet plan for patients and chart their progress. “This is very important for diabetics because of their problems with metabolizing carbohydrates, and for patients with renal diseases for eliminating proteins from the body,� said Dr. Jeffrey Kang, the CMS chief clinical officer. “Both conditions cause damage to other parts of the body if not controlled.�

Another important new policy forbids discrimination in services for those with Alzheimer’s disease. Families had long complained that Alzheimer’s patients were being denied services such as occupational therapy or speech therapy. Someone who suffered a stroke, for example, might need help in relearning to walk or speak. Someone who had a hip replacement might need help in walking again. Some local insurance carriers in different regions of the country were denying these services on the grounds that Alzheimer’s patients, having lost their mental acuity, could not benefit from the rehabilitation.

After years of complaints, the federal government decided this was discriminatory and ruled that all patients, regardless of their medical condition, are entitled to all services covered by Medicare. Many Medicare beneficiaries have low incomes and are eligible for financial help from the federal government. About 13% of the beneficiaries--about 4.6 million people--have incomes below the federal poverty line: $8,860 for an individual, and $11,940 for a couple.

All are eligible for free Medicare services. And partial help with Medicare expenses is available to millions more on the Medicare rolls, depending on their incomes and assets.

But these assistance programs are not well-known--fewer than a quarter of those eligible are enrolled. The government aims to change that. In May, the Social Security Administration will begin sending up to 18 million letters to those who might be entitled to aid.

Eligibility is linked to income and assets. The Qualified Medicare Beneficiary, or QMB, program is open to those individuals with incomes up to $739 a month and financial resources (stocks, bonds, savings accounts) of $4,000 or less. A couple can have an income up to $995 a month and assets up to $6,000.

If you qualify, the government will cover your cost-sharing expenses under Medicare, all co-payments and deductibles (such as $812 for the first day in the hospital, and 20 co-payments for approved services by doctors). It also will cover the $54 a month premium you pay for Part B coverage for doctor bills. In effect, all your Medicare costs will be covered and you will have no out-of-pocket expenses.

The Specified Low-income Medicare Beneficiary, or SLMB, program is available to individuals with income up to $886 a month, and couples with income up to $1,194 monthly. The asset test is the same as for QMB, a limit of $4,000 for an individual and $6,000 for a couple.

This program will cover the cost of the Part B premium, the $54 a month each beneficiary pays. The monthly premium is deducted from Social Security benefit checks.

When someone qualifies for QMB or SLMB, the premium is no longer deducted from the Social Security benefit payment. Information on these programs, as well as other Medicare activities, is available from the Health Insurance Counseling and Advocacy program, operated by the California Department of Aging. The statewide number is (800) 434-0222. The Web site is www.cahealthadvocates.org. The Medicare Rights Center in New York also operates a helpful Web site at www.medicarerights.org.

Another important change--and something new in Medicare’s history--begins July 1. No more switching from one HMO to another, from regular Medicare to an HMO, or from an HMO back to regular Medicare.

The ability to switch has always been a safety valve for Medicare beneficiaries, especially those who are frail and suffer chronic, expensive health problems.

Traditional Medicare gave them unrestricted selection of doctors and hospitals. But the HMOs offered extra benefits such as no co-payments or deductibles, and most important, prescription drugs, which are not covered by Medicare.

Congress decided in 1997 to make changes in the Medicare program to make it resemble regular health insurance, and ordered a reduction in the ability to move freely among health plans. Medicare enrollees had been allowed to move in and out of plans on a monthly basis.

The potential impact will be felt most heavily in California, where a third of Medicare beneficiaries belong to HMOs, contrasted with 14% nationally.

For example, if an HMO indicated it would not cover a procedure or surgery sought by a member, the individual could return to traditional Medicare, and find a doctor who would perform surgery and accept Medicare reimbursement.

“This is a huge change,� said Aileen Harper, associate director at the Center for Health Care Rights, a Los Angeles consumer advocacy group. She worries that many beneficiaries don’t realize they can no longer switch.

The rules will be even more strict next year. During open enrollment in November of this year, beneficiaries must choose a health plan for 2003. They will be allowed to make one switch between Jan. 1 and March 30, but will be locked in for the rest of the year.

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Bob Rosenblatt welcomes your questions, suggestions and tips about coping with the changing world of health care. He can be reached by e-mail at [email protected]. Dollars & Sense runs the fourth Monday of each month.