Prepare for that bon, voyage by knowing the limits of Medicare while traveling

senior couple at airport.By Dr.Katy Votava, August 4, 2017

The travel season is in full swing!  Whether a fabulous trip to a new destination or a familiar one it is wise to include planning for your health care needs while you are developing the itinerary. Be smart and think ahead to include your routine health needs as well as emergencies in the process before you go to limit snafus along the way!

How does my Medicare work when I travel?

One of the questions I am frequently asked is, “How does my Medicare work when I take a trip?” It is important to know what works and what doesn’t with Medicare and travel so that you do not get stuck with insufficient care and unexpected high bills. The answer to this question is determined by what the person’s health needs are and what type of Medicare coverage they have.

What “Style” is your Medicare

The first thing folks need to know to answer that question is what “style” of Medicare do they have? What I mean is that there are two “styles” or methods of putting the pieces of Medicare together. The two most common “flavors” are:

  • “A La Carte” Medicare: Similar to ordering a meal a la carte, Medicare has various parts that are separate and hopefully complementary. Medicare “A La Carte” includes Medicare Parts A (hospital care) and Part B (outpatient services), a stand alone Medicare Part D (prescriptions drugs) plan and many times a Medigap plan for supplemental coverage.
  • “Prix Fixe” Medicare: Just like a prix fixe meal, Medicare parts and pieces can be combined into one package call Medicare Part C or Medicare Advantage. Typically “Prix Fixe” Medicare combines Medicare Parts A, B, usually D and some supplemental coverage into one package.

Medicare health care benefits while traveling vary between the “A La Carte” and “Prix Fixe” styles of coverage. The benefits also differ depending on if the travel is domestic or foreign.

Traveling in the US

“A La Carte” Medicare allows for very flexible travel coverage for medical emergencies as well as routine health care all over the 50 U.S., Washington, D.C., Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa and the Northern Mariana Islands. Given that there are no health provider networks involved, beneficiaries can use their Medicare to pay for care at any facility that accepts Medicare nationwide.

If the person also has a Medigap plan, that can be used in conjunction with Medicare anywhere in the U.S. to pay for some or all of Medicare copayments, deductibles, and co-insurance. Medigap is not networked dependent. Therefore, the beneficiary can use Medigap to reimburse standard Medicare copayments and coinsurance from any provider who accepts Medicare.

“Prix Fixe” Medicare plans work anywhere in the United States and its territories for an actual medical emergency. If folks need urgent care or other services, they will get more value for their money for by going to an in-network center.

The “Prix Fixe” style may provide coverage for routine health care if there is an in-network provider nearby. People can quickly find which providers are in network with their Medicare Part C plan by calling the customer service number on the back of their insurance card or by checking the website for in-network health care services.

Medicare & Foreign Travel

In rare instances Medicare may pay for health care services in a foreign hospital if the person is:

  • In the U.S. experiencing a medical emergency and the foreign hospital is closer than the nearest U.S. hospital.
  • Traveling through Canada by the most direct route between Alaska and another U.S. state when a medical emergency occurs, and the Canadian hospital is closer than the nearest U.S. hospital.
  • Living in the U.S. and the foreign hospital is closer to their home than the nearest U.S. hospital that can treat their medical condition, regardless of whether it is an emergency.
  • Under certain limited conditions, Medicare will even pay for services on a cruise ship.

Many people with the “A La Carte” Medicare have a Medigap policy for supplemental coverage. While Medigap has 11 different levels of coverage, some of those levels have the bonus of some foreign travel emergency coverage. Medigap Plans C, D, F, G, M, and N pay 80% of medically necessary emergency care outside the U.S. Foreign travel emergencies are covered during the first 60 days of the trip and if Medicare does not otherwise cover the care. There is a $250 annual deductible with a $50,000-lifetime limit.

Very few “Prix Fixe” Medicare plans offer any foreign travel medical emergency coverage. For those that do, the dollar amounts are insufficient. A person with “Prix Fixe” Medicare may want to consider purchasing a stand-alone foreign travel health policy.

Regardless of the style of Medicare coverage, a word to the wise is to consider buying medical evacuation insurance, particularly if you are traveling to exotic locations or have complex medical conditions. Neither Medicare, Medigap or basic travel health policies pay for medical evacuation. Medical evacuation can run more than $100,000. Travel services are a good source of that type of insurance.

Medicare Prescription Drug Coverage and Travel

Medicare’s prescription drug coverage, whether as part of an “A La Carte” or “Prix Fixe” style of Medicare, is relatively flexible for travel throughout the U.S. and territories. It is always a good idea to stock up on routine medications before embarking and store them properly along the way.

All Medicare Part D prescription drug plans involve networks. The best cost for any medication is at a “preferred” or “in-network” pharmacy. As mentioned earlier, folks can call customer service or check out the plan website for covered pharmacies.

Medicare Part D plans do not cover medications purchased outside of the US. Make sure that you have adequate supplies before travel. Be very careful of buying medications when you are traveling abroad. If you must purchase medicines; do so only from reliable providers.  Also, make sure that the drugs you get are the same as the one you expect. Many medications have different names and formulations outside the US.

Healthcare Travel Planning Checklist

Here is a checklist for your healthcare travel planning:

  • Find out if you have “A La Carte” or “Prix Fixe” Medicare.
  • Review my advice that fits your Medicare style.
  • Double check your prescriptions and medical supplies and stock up as necessary.
  • A copy of all your coverage cards, front and back, with you and leave copies with a trusted friend or family member.
  • Pack lists of medications, allergies and health care provider names and contact
  • Consider packing a copy of your health care proxy and other relevant medical documents

If you plan, you are prepared for the routine and as well as unexpected medical things that pop up, leaving the most focus on having fun!  Bon, voyage!

For more information about Medicare read our book Making the Most of Medicare: A Guide for Baby Boomers

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Posted in Medicare, Medicare Travel Coverage

HSAs: Little Understood, But Here To Stay

JUNE 28, 2017 • BEN MATTLIN -Financial Advisor
Quote by Dr. Katy Votava in this article

Back in December 2003—well before there was an Affordable Care Act, let alone talk of repeal and replace—then-President George W. Bush created health savings accounts (HSAs). Still scarcely understood, HSAs have nonetheless grown in popularity. According to the Devenir Group, a Minneapolis-based industry organization, there were nearly 17 million HSAs, with an aggregate value of more than $30 billion, at the end of 2015, the most recent results available.

But as the health care debate continues in Washington, are HSAs still relevant? More importantly, are they a good idea for your clients?

HSAs For Retirement Planning

HSAs are only for people with certain high-deductible health plans (HDHPs). They allow account holders to put aside money to help pay those high deductibles and other medical expenses later, as needed. But advocates insist they are also great savings and retirement planning vehicles.

There are several reasons. First, money that goes in can be deducted from federal income taxes. Plus, it grows tax-free. And it can be withdrawn tax-free at any time if used for qualified medical expenses. “HSAs are the only account type that gives you the tax trifecta,” says Christopher Hershey, a senior financial planning analyst at eMoney Advisor in Radnor, Pa. “Simply put, they are the most tax-efficient savings vehicles available.”

HSAs are similar to flexible spending accounts (FSAs) with one important difference: Health Savings Accounts are not use-it-or-lose-it. “There’s no requirement to deplete the account by a specific date,” says Tim Steffen, director of financial planning at Baird in Milwaukee. “You can use it to pay for any health-care expenses incurred after the date you fund it. This means you can fund it today, let it grow during your working years, and then take withdrawals later in life for expenses you incurred in previous years.”
READ the entire article

Posted in HSAs

Republican health proposal may mean you work longer and save less for retirement

This is what the proposed health-care bill means for older American

BY Robert Powell, Retirement Columnist, Marketwatch
With quotes from Dr. Katy Votava
Published: June 28, 2017

 

Older pre-Medicare Americans will have to pay more for health insurance and health care should the Senate’s bill to repeal and replace the Affordable Care Act (ACA) — the Better Care Reconciliation Act (BCRA) — become the law of the land.

What’s more, older Americans may have to reduce the amount they save for retirement or use retirement funds to pay for current health-care needs or keep working to age 65 if only to keep their employer-sponsored health insurance plan.

Number of people to lose coverage

The Senate bill would increase the number of individuals who are uninsured by 22 million in 2026 relative to the number under current law, slightly fewer than the increase in the number of uninsured estimated for the House-passed legislation, according to a Congressional Budget Office (CBO) report released on Monday. By 2026, approximately 49 million people would be uninsured, compared with 28 million who would lack insurance that year under current law, the CBO says.

What’s more, the increase would be disproportionately larger among older people with lower income—particularly people between 50 and 64 years old with an income of less than 200% of the federal poverty level, the CBO wrote.

Under the House bill, the American Health Care Act (AHCA), the CBO estimated that more than five million older adults ages 50-64 would lose health insurance.These older Americans would likely have to return to work, or dip into retirement savings, or stop saving for retirement, or go without health care in the worst of cases, experts say.

Wider age bands and less generous subsidies

Older adults across the country, not yet eligible for Medicare but in need of health insurance, can also expect higher premiums under the Senate bill due to wider age bands and less generous subsidies than current law, according to Tricia Neuman, a senior vice president with the Henry J. Kaiser Family Foundation.

Read the entire article here.

 

Posted in Medicare, retirement planning
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