Nebraska Department of Insurance
THE NEBRASKA HEALTH INSURANCE INFORMATION, COUNSELING, AND ASSISTANCE (NICA) PROGRAM
DECEMBER 1998 NICA NEWS
ISSUES
Web Sites
While "surfing" the Web, one needs to remember that not all sites are equal. When it comes to health care, there are several thousand sites. These sites may address a type of illness that comes from a specific research center. For example:High Blood pressure is a risk factor for congestive heart failure, myocardial infarction (heart attack), diabetes, valvular heart disease and cardiomyopathies (diseases of the heart muscle). Work with your doctor to keep your blood pressure under 140/90.
For the new DASH high blood pressure diet, visit http://dash.bwh.harvard.edu
The Mayo Clinic site includes topics such as allergies, dental specialties, nutrition and skin conditions. Their site address is http://www.mayo.edu
The Hope Health Letter, sponsored by the Hope Heart Institute has a web site for general health information articles at http:// www.hithope.com/findit
1999 Medicare Deductibles, Coinsurance and Premium Amounts
The Department of Health and Human Services announced 1999 rates for the Medicare Part A deductible and Part B monthly premium. These amounts are recalculated each year to reflect changes in health care costs and the Medicare law. For 1999, the Medicare Part B premium will increase $1.70 a month - the first increase since 1997. The total monthly premium will be $45.50.
The Medicare Part A deductible for inpatient hospital care will rise by $4, to $768, from $764 in 1998. The small increase largely reflects savings from reductions in Medicare hospital payments and other program changes signed into law in the Balanced Budget Agreement to help protect and preserve the Medicare Hospital Insurance Trust Fund.
After the first 60 days of inpatient hospital care, the beneficiary coinsurance for hospital stays is rising by $1per day to $192 a day. (Last year, the coinsurance was $191 per day.) The beneficiary coinsurance for stays longer than 90 days will be increased by $2 per day to $384 per day. The skilled-nursing facility coinsurance, which must be paid after the first 20 days of skilled-nursing care, will increase by $.50 per day to $96 per day.
GRANT AWARDED TO NICA FOR TELEVISION COMMERICAL
The NICA Program has been awarded a Special Project grant from the Health Care Financing Administration. This is a grant that is above and beyond the NICA yearly grant. In order to receive this, a special application for funding was required. It was also required that the grant money be used in a creative way to help Medicare Beneficiaries understand the recent changes in Medicare with Medicare+Choice. Nebraska is proud to be one of a handful of states that were awarded this Special Project grant.NICA proposed to air a commercial about Medicare+Choice. The commercial will give more Nebraska Medicare beneficiaries the opportunity to hear that, "Medicare is changing, but you don't have to change." The more individuals that hear this message, the less confusion there will be about Medicare+Choice.
The television station that offers the largest coverage in Nebraska is 10/11 KOLN/KGIN, the CBS affiliate. This station has the ability to reach most of the Nebraska counties. This is the station that was hired to produce and air the NICA commercial.
Research was conducted on the dominant market area of people over 55 and television viewing. It was determined there are six television shows on KOLN/KGIN that are routinely viewed by older Nebraskans. They are CBS This Morning, CBS News Sunday Morning, CBS Morning Rotation, Midday Report, Six O'clock News and Wheel of Fortune. The NICA commercial will be run at different times during these broadcasts. Selecting these programs will give NICA the opportunity to reach approximately 2,756,000 viewers. The commercial will run for two months starting in December!
The commercial was shot on November 20, 1998 at the Nebraska State Capitol. NICA is happy to announce that Jean Meyer agreed to be the talent in the television commercial. Jean is a NICA Volunteer for the South Central Region. She drove to Lincoln the day before the commercial and stayed the night at a hotel. She was ready to start work at 9:00 the next morning. Thank you, Jean, for taking time out of your schedule to participate on this special project.
The NICA Program Office hopes that you have an opportunity to see the commercial for yourself!
CONSUMER BULLETIN
By Don Stenberg
Nebraska Attorney General
Living Trust Scams Target Elderly
Lincoln - Attorney General Don Stenberg said that the rapid growth in the sales of living trusts has spawned a fraudulent industry which directly targets the elderly.According to Attorney General Stenberg, a "living" or "revocable" trust is a document created during your lifetime that is used as a form of estate planning as an alternative to a will in property distribution.
"The marketing of living trusts, by telephone, door-to-door sales, or in seminars, has become a popular and legitimate alternative to traditional estate planning in recent years. Unfortunately, the rapid growth of this industry nationwide has also caused it to become a major source of consumer fraud - targeted directly at the elderly," Stenberg said.
"Oftentimes, defects in the documents will not be discovered until after it is too late to correct them, leaving survivors with a legal and financial nightmare," he said.
As part of the sales presentation, consumers may be told that "everyone needs a living trust" to avoid the cost and delay of probate and to reduce estate taxes. Consumers may also be told that, by purchasing the estate planning information they will have access to attorneys who will answer their estate planning questions and prepare their estate planning documents, free of any additional charge. In other cases, consumers may be told that by purchasing certain forms and other information, they can create their own living trust without hiring an attorney.
"A living trust properly prepared by a licensed attorney is legal in Nebraska, but citizens should consult an attorney before deciding to use a trust. Living trusts are the right choice for some people, but are complicated legal documents and can cause many more problems than they solve if not used properly," Stenberg said.
"Prior to entering into these agreements, consumers who are considering a living trust should educate themselves and consult their own attorney on the particulars of Nebraska law before proceeding," he said.
If you have questions regarding a company selling living trusts in Nebraska, or for information about other consumer related issues, contact:
The Office of Attorney General
Don Stenberg
Consumer Protection Division
2115 State Capitol Building
Lincoln, NE 68509
(402) 471-2682
Consumer Protection Line 1-800-727-6432
More Stupid Criminals
The following is a true story from San Francisco.A man wanted to rob a downtown Bank of America, so he walked into the branch and wrote on a deposit slip: "This iz a stikkup. Put all your muny in this bag."
While standing in line, waiting to give his note to the teller, he began to worry that someone had seen him write the note and might call the police before he reached the teller window. So he left the Bank of America and crossed the street to Wells Fargo.
After waiting a few minutes in line, he handed his note to the Wells Fargo teller. She read it and, surmising from his spelling errors that he was not the brightest light in the harbor, told him that she could not accept his stickup note because it was written on a Bank of America deposit slip, and that he would either have to fill out a Wells Fargo deposit slip or go back to Bank of America. Looking somewhat defeated, the man left.
The Wells Fargo teller then called the police, who arrested the man a few minutes later as he was waiting in line back at Bank of America.
Medicare is Changing, but You Don't Have To!
In addition to original Medicare and health maintenance organizations, a broader array of health plans will be able to join Medicare. These expanded health plan choices, known as Medicare+Choice, were created as part of the 1997 Balanced Budget Act.Medicare+Choice means that a person can opt between his or her traditional Medicare plan or change to one of the new plans.
Not everyone in Nebraska will have the opportunity to make a change. Because of the availability of Medicare+Choice contractors, the only Nebraska beneficiaries that currently have a choice are those living in Douglas or Sarpy Counties.
Regardless of a beneficiary's decision, he or she will still be enrolled in Medicare.
The Health Care Financing Administration (HCFA)-the federal agency that administers Medicare -has already begun its Medicare+Choice campaign. The campaign includes dissemination of information, an 800 number that some beneficiaries can call with questions, and information on the Internet. The Internet site is www.Medicare.gov
Listed below are the new Medicare + Choice options. The only option available in Nebraska is the health maintenance organizations in Douglas or Sarpy County. Otherwise, there are no other options available to Nebraska Medicare Beneficiaries. Instead, they would continue to receive Medicare in the same manner they are they are currently receiving it. They would not change. Remember, Medicare is Changing, but You Don't Have to Change!
Listed below are the options that Medicare+Choice created.
- Original Medicare: This option-available everywhere-allows beneficiaries to select almost any doctor, hospital, or other health care provider. Medicare makes its payment for health care services, and the beneficiary pays deductibles and coinsurance and balance billing amounts. They can choose to purchase a Medicare supplemental insurance policy (Medigap) to help defray their portion of their health care costs. Some beneficiaries also have supplemental coverage from other sources such as a former employer or Medicaid.
- Health Maintenance Organizations (HMOs): In HMOs, beneficiaries must obtain services from a designated network of doctors, hospitals, and other health care providers who have agreed to provide care to plan enrollees, usually with little or no out-of pocket payments.
- Health Maintenance Organizations with a Point of Service (POS) Option: When combined with a basic HMO package, the POS allows beneficiaries to selectively go out of network to receive services, with higher out-of-pocket payment requirements.
- Preferred Provider Organizations (PPOs): Beneficiaries in PPOs obtain services from a network of health care providers that has been set up by the health plan. Unlike an HMO, beneficiaries can choose to go to providers who are not in the network and the plan will pay a percentage of the costs while the beneficiary is responsible for the rest.
- Provider Sponsored Organizations (PSOs): PSOs are a relatively new form of managed health care that, for beneficiaries, work much like an HMO, except that they are formed by a group of hospitals and doctors who directly take on the financial risk of providing comprehensive health benefits for Medicare beneficiaries.
- Private Fee-For-Service Plans (PFFS plans): The Medicare beneficiary elects a private indemnity-type insurance plan. The insurance plan, rather than the Medicare program, decides how much to reimburse providers for health care services. Medicare pays the private plan a premium to cover traditional Medicare benefits. Providers are allowed to bill beyond what the plan pays (up to a limit), and the beneficiary is responsible for paying what the plan doesn't cover. The beneficiary may also be responsible for additional premiums.
- Medical Savings Accounts (MSAs): Up to 390,000 Medicare beneficiaries will be allowed to participate in an MSA demonstration. The beneficiary chooses a Medicare MSA Plan-a health insurance policy with a high deductible. Medicare pays the premium for the MSA Plan and makes a deposit into the Medicare MSA that is established by the beneficiary. These funds pay for services before the deductible is met and for other non-covered services. Unlike other Medicare plans, there are no limits on what providers can charge above the amount paid by the Medicare MSA Plan. Individuals who enroll in MSAs are locked in for the entire year. However, they have until December 15 of the year they enrolled to withdraw.
Medicare Handbooks
There will not be a Medicare Handbook in 1999. Instead Medicare had published a few different brochures titled Medicare & You. This is a different approach than previous years. Please read the following to become familiar with the new Medicare & You brochures. Included in this mailing, all NICA Volunteers will receive a copy of the Medicare & You bulletin. If you need additional copies of this brochure, please contact the program office at (402) 471-3845.
There is a tri-fold brochure that will be sent to all Medicare Beneficiaries that are already receiving Medicare benefits. There are a total of seven pages in this brochure. This bulletin provides beneficiaries with a brief introduction to the changes in the Medicare program. There is also a removable page with important phone numbers.
There is a revised Medicare Handbook with the new name of Medicare & You. A copy will be sent to individuals that are turning 65 and are eligible for Medicare. This brochure includes a description of the original Medicare plan, new preventive benefits available to you, the rights you have as a patient and the new health plan options available to you. There are 36 pages included in this brochure.
Medsupp Closures
Four of the Medicare Supplement Plans listed below are changing their block of business.Effective 12/1/98, American Family Life Assurance Company of Columbus (AFLAC) will no longer be issuing Individual Medicare Supplement Plans A, B, C, F, and G. Therefore, AFLAC will no longer have a plan available to the individual market as it had previously withdrawn plans D and E to the individual market.
AFLAC will continue to support its existing block of Individual Medicare Supplement policies in accordance with appropriate state laws.
Effective 1/1/98, American Republic Insurance Company (Americare) will discontinue Medicare Supplement Plans "B" and "J".
Effective 1/1/99, National States Insurance Company will no longer offer the "H" and "J" plans for sale.
Effective 12/31/98, Continental Life Insurance Company of Brentwood, Tennessee will no longer be selling Medicare Supplement Plans "H" or "I".
What happens when a block of business closes?
There will be no new policies sold; consequently, there will not be any new people added to the block of business. As the existing block members age, it is likely that the cost of claims per member will increase.Therefore, the premium will also increase. Healthy members, seeing the increase in premiums, will be able to switch to a different policy. This decrease in the number of healthy members will also cause the premiums to increase. As those healthy persons move to other policies, the cost of claims per person in the closed block increases.
Theoretically, as policyholders die or switch to cheaper policies, those who remain do so because they cannot obtain coverage elsewhere. When those remaining persons file claims, it causes the premiums to increase further. Eventually, the premiums could exceed the "reasonable" cost of the benefits provided.
As a Seniors Insurance Volunteer, you may wish to let your clients with these policies know the above information. What a policyholder decides to do about changing or not changing should remain his or her own decision.