Medicare and You -- 2002-2003 Beneficiary Brochure (English)

Focus on the Basics

What is Medicare?

Medicare is a federal health insurance program. Congress established the Medicare program in 1965 as Title XVIII of the Social Security Act.

The Centers for Medicare and Medicaid Services (CMS), formerly known as the Health Care Financing Administration (HCFA), run the Medicare program. The Social Security Administration helps by enrolling qualified people into the program.

Medicare offers basic protection against the cost of healthcare, but it doesn't cover all expenses.

Although Medicare is a federal program, private insurance companies called intermediaries and carriers actually manage it under CMS' direction.

Who qualifies for Medicare benefits?

Three groups of people qualify for Medicare:

t People 65 years of age or older

t Certain disabled people under 65 years of age

t People of any age who have permanent kidney failure

How does Medicare work?

Medicare has two parts, Part A and Part B.

Part A is hospital insurance. Part of the payroll (FICA) tax paid by workers and their employers finances Part A. Medicare Part A is managed by intermediaries that process Medicare claims submitted by:

t Hospitals

t Skilled nursing facilities

t Hospice

t Home health agencies

Part B is medical insurance. People with Medicare Part B pay monthly premiums to finance Part B. Your Part B premium either automatically comes out of your Social Security check or you get a quarterly bill. Medicare Part B is administered by carriers that handle claims from:

t Physicians and nurse practitioners

t Suppliers

t Other healthcare providers

Medicare Part B includes, but is not limited to the following services:

t Ambulance

t Physician

t Durable medical equipment, prosthetics, orthotics and supplies

t Outpatient hospital care

Focus on Part B

Deductible/coinsurance

The 2001 Part B deductible is $100 and coinsurance is 20%.

Generally, the Part B deductible and coinsurance stay the same from year to year. After you pay the yearly $100 deductible, Medicare will generally pay 80% of the approved charges for covered services. You pay the other 20%, called the coinsurance amount.

Mandatory claim submission

In 1989, Congress ruled that providers/suppliers of Medicare Part B services must submit claims on behalf of people with Medicare. If your supplier does not file claims for you, please call the Palmetto GBA Service Center at 1-800-583-2236.

Assignment

Assignment is an agreement between the provider and a person with Medicare. The provider agrees to accept the Medicare-approved amount as full payment for covered items or services.

If your Medicare provider accepts assignment, you generally pay only 20% of the Medicare-approved charge, plus any unmet part of your deductible. You are not liable for charges over the Medicare-approved amount. Of course, your doctor or supplier can charge you for items or services that Medicare does not cover.

Whether or not they accept assignment, providers/suppliers must submit the claim.

Participation

Doctors and suppliers who have agreed to accept assignment for all of their services are called "participating" providers. They always accept the Medicare-approved amount as payment in full for covered services.

If physicians or suppliers choose to participate, they must do so for the calendar year. If a doctor or a supplier does not participate, he may still accept assignment on a claim-by-claim basis.

Focus on DMEPOS

In an effort to provide greater efficiency in the Medicare program as it applies to durable medical equipment, prosthetics, orthotics and supplies (DMEPOS), effective October 1, 1993, CMS awarded contracts to four healthcare carriers. These four carriers are called Durable Medical Equipment Regional Carriers, or DMERCs.

Each DMERC covers a specific area of the country and only handles DMEPOS claims for its own region.

Who is my DMERC?

There are four DMERC regions–Region A, Region B, Region C, and Region D. If your permanent address is in one of the states listed on the next page, Palmetto GBA, the Region C DMERC, will process your DMEPOS claims.

Region C includes the following states and U.S. territories:

If you have questions regarding your Medicare DMEPOS claims, please contact Palmetto GBA for assistance.

The Medicare Summary Notice (MSN) details the date of service, the item or type of service provided, the amount charged, and the amount Medicare allowed and paid.

Medicare pays 80% of the approved amount. You may be billed for the deductible, the coinsurance, and any non-covered service(s).

Customer service information

In the top right-hand corner of your MSN, you will find very important information about your claim(s). The box contains your Medicare number which should match the number on your red, white, and blue Medicare card.

The box also gives the address and phone number for Palmetto GBA. Please refer to this box for questions about your MSN.

For all inquiries, include the following information:

t Your Medicare number

t The date of the MSN

t The date of service

Advance Beneficiary Notice (ABN)

The ABN agreement protects people with Medicare and suppliers from unknowingly being liable for services that Medicare denies as "not medically needed," a violation of the prohibition on unsolicited telephone contacts, supplier number requirements that are not met, and failure to obtain advance determination of Medicare coverage (on certain power wheelchairs only).

If the supplier informs you in advance--in writing--and you sign the ABN agreeing to be personally and fully responsible for payment if Medicare denies your services for these reasons you are liable for payment of the denied services.

The ABN applies only to assigned and non-assigned claims. It does not apply to items not covered by the Medicare program. You are responsible for payment of items not covered by the Medicare program.

Durable medical equipment

Durable medical equipment (DME) is equipment that meets all of the following requirements:

t Can withstand repeated use

t Is primarily and customarily used to serve a medical purpose

t Is generally not useful to a person in the absence of an illness or injury

t Is appropriate for use in the home

A physician often prescribes special equipment for a person with Medicare to use in his home. The equipment may provide healing benefits or enable you to perform certain tasks precluded by certain medical conditions and/or illnesses.

DME includes, but is not limited to:

Diabetic supplies	Power operated vehicles (POVs, or scooters)
Canes, crutches, walkers	Seat lift mechanisms
Commode chairs	Traction equipment
Home oxygen equipment	Wheelchairs
Hospital beds

Prosthetic items replace all or part of the function of an internal body organ. Orthotic items help to correct or prevent physical deformities. Examples of prosthetic and orthotic devices include the following items:

t Artificial limbs and eyes

t Breast prostheses

t Corrective lenses after cataract surgery

t Diabetic shoes

t Leg, arm, and neck braces

Certificate of Medical Necessity

A Certificate of Medical Necessity (CMN) is a form required by Medicare authorizing the use of certain DME prescribed by a physician. This form is to be completed by your doctor or the doctor's employee.

Your supplier will work with your doctor to submit all necessary information to Medicare. If your condition or prescription changes, you will need an updated CMN.

The following items require a CMN:

Air-fluidized beds	Parenteral and enteral nutrition
Hospital beds	POVs, or scooters
External infusion pumps	Seat lift mechanisms
Lymphedema pumps/pneumatic compression devices	Transcutaneous electronic nerve stimulators (TENS)
Osteogenesis stimulators	Wheelchairs
Oxygen

Prescription before delivery

Medicare will pay for certain covered items only if the supplier has a written order for the item before its delivery. These items are:

t Decubitus care cushions/mattresses

t Items to prevent pressure/bed sores

t POVs, or scooters

t Seat lift mechanisms

t TENS

Important note

Medicare will only pay for items delivered after, not before, the physician prescribes them.

Rental or purchase

Medicare approves some DME items for purchase and others for rental. Your supplier will know whether Medicare requires purchase or rental for your items.

If you purchase an item covered by Medicare, you may also be entitled to repairs and replacement parts.

You may keep rental items for as long as they are medically needed. Any repairs or replacement parts for rental items are the responsibility of the supplier. The supplier will pick up the equipment when you no longer need it.

Rented items and services

Medicare requires that you rent certain types of medical equipment and places a limit on the number of rental payments.

This "capped" rental category consists of any item meeting the following qualifications:

t Not customized

t Not oxygen or oxygen-related

t Not routinely purchased

t Not service-intensive

Examples of capped rental items include, but are not limited to, the following items:

t CPAP devices

t External infusion pumps

t Hospital beds

t Nebulizers

t Air-fluidized beds

t Wheelchairs

The capped rental program enables people with Medicare to spread their share of the rented item's cost (i.e., coinsurance) over a longer time period instead of paying in one lump sum. This also protects the person with Medicare from making an incorrect purchase decision.

Medicare requires the supplier to offer you a "purchase option" after the item has been rented for nine consecutive months. You should respond to the purchase option letter within 30 days and indicate whether you would like to purchase or continue renting the equipment.

t If you choose the purchase option, Medicare will make a total of 13 rental payments. You then own the equipment, and Medicare will pay for necessary repairs.

t If you choose the rental option or do not respond to the purchase option letter, Medicare will make a total of 15 rental payments.

After 15 rental payments, Medicare pays only a semi-annual maintenance and servicing fee (whether or not service is provided). This continues as long as the item is medically necessary or until Medicare coverage ceases.

After 15 rental payments, even though your supplier still owns the item, you can keep the item as long as your doctor feels it is medically necessary.

Important note

If your doctor prescribes a capped rental item and you decide to purchase it without first renting for nine months, your Medicare claim will be denied. The only exception to this rule is motorized wheelchairs. They may be purchased in the first rental month.

Focus on secondary payer

It's not uncommon for people with Medicare to have other insurance. The primary insurer is the plan that pays first.

The other plan is the secondary payer, the one that helps pay the rest of the charges. But, which is which?

Medicare may be secondary if you have other coverage through any of the following insurers:

t Employer group health plan(s)

t Public Health Service or Indian Health Service

t Veterans Administration, Workers' Compensation, or Department of Labor Black Lung Program

You should always tell the doctor, hospital, or supplier if you have other insurance. If Medicare is secondary, ask your provider/supplier to file the claim with your primary insurer first. Give the explanation of benefits from the primary insurer to your provider so he can file for your Medicare benefits.

This system of coordinating benefits helps protect Medicare funds.

If you have questions regarding Medicare as a secondary payer, please contact Palmetto GBA for assistance.

Focus on appeals

If you disagree with the Medicare decision

There may be an occasion when you disagree with Medicare's decision on your claim. You always have the right to appeal.

You will find details on the Medicare Summary Notice (MSN), but here is some general information about the appeals process.

You can appeal Medicare coverage decisions regarding any of the following issues:

t Amount of the deductible

t Coverage of furnished items and services

t Medical necessity of a service

t Any other issues affecting the amount of benefits, such as an overpayment or underpayment

Filing the appeal

Effective January 1, 2003, you have 120 days from the MSN date to file an appeal. (Previously, the time limit was six months.) If the claim is assigned, the supplier may also appeal. If the claim is nonassigned, you must request the appeal.

Filing an appeal is easy. It has to be in writing, but it does not have to be formal. It can be as simple as sending in a copy of the MSN and writing, "Please review" on top of the page. If you prefer to send a separate letter, you should include the following information:

t Specifics on which claims are in question

t Your address and phone number

t Your Medicare number

If you prefer, you can fill out the form entitled, "Request for Review of a Part B Medicare Claim." You can get this form at your local Social Security office.

Palmetto GBA has 45 days to review your claim. The review process will result in payment or a letter agreeing with the denial. The denial letter will provide information about the next appeal level.

Further stages of appeal

What if you disagree with the review? You have a right to appeal again, if the total of the claim or claims is at least $100.

More than one claim can apply toward the $100 amount in question.

You have six months from the date of the review decision to request a carrier hearing. There are additional appeals, such as an Administrative Law Judge hearing and Appeals Council review.

All Medicare denial letters include information on how to appeal to the next level. You may call Palmetto GBA for assistance.

Special circumstances

What happens if you are unable to appeal within the time limit? For example, hospitalization may prevent some patients from responding in a timely manner. If there is a good reason for the delay, the time limit may be extended.

Focus on fraud and abuse

Defining the problem

There are always some people who try to take advantage of any system. The Medicare program is no exception.

Fraud and abuse do exist in the Medicare program, but Medicare has a powerful weapon for targeting these crimes--you!

You are in the best position to alert Medicare of fraud and abuse cases.

Here's how the CMS defines fraud and abuse:

Fraud

It is an intentional deception or misrepresentation that could result in payment of an unauthorized Medicare benefit.

Abuse

This is a provider practice that directly or indirectly results in unnecessary costs to Medicare or improper reimbursement.

Examples

Here are some examples of fraud and abuse:

t Billing Medicare for unnecessary services

t Billing Medicare for services not provided

t Billing Medicare after picking up a piece of equipment

t Billing Medicare for more money than you were actually charged

t Requiring payment other than coinsurance and deductible on assigned claims

What to do

Whenever you receive an MSN, always check it carefully to make sure everything is correct. Call your provider if you have a question about your claim. If you suspect Medicare fraud or abuse--report it! Call your DMERC and explain why you believe there is a possible case of fraud and abuse.

Have this information ready when you call:

t Your Medicare number

t Date(s) of the service(s) in question

t Doctor or supplier's name and address

Medicare will investigate every call. There's no cost to you, and your report is strictly confidential.

Focus on important topics

Eyeglasses

Refractive lenses are covered when they are medically necessary to restore vision not provided by the crystalline lens of the eye because of surgical removal or congenital absence.

One pair of eyeglasses or contact lenses is covered after each cataract surgery with insertion of an intraocular lens. This is true even though a prior set was provided before the patient was Medicare-eligible. The date of cataract surgery must be included on the claim to Medicare.

For patients who do not have an intraocular lens, these lenses or combinations of lenses are covered when determined to be medically necessary:

t Bifocal lenses in frames

t Lenses in frames for far vision

t Lenses in frames for near vision

t When contact lenses for far vision are prescribed, payment will be made for the contact lenses and lenses in frames for near vision (to be worn at the same time as the contact lenses) and lenses in frames to be worn when the contacts have been removed.

Medicare covers tinted, oversized, or ultraviolet lenses if your doctor prescribes them, and if Medicare determines that such lenses are reasonable and medically necessary.

Standard and deluxe frames

Medicare will allow payment for standard frames.

If you choose deluxe frames, you will be responsible for that payment.

Standard and progressive lenses

Medicare will allow payment for standard lenses.

If you choose progressive lenses, you will be responsible for that payment.

Low vision aids

Low vision aids are non-covered items.

These aids are used to maximize residual vision rather than replace "all or part of an internal body organ" and, therefore, do not meet the definition of a prosthetic device.

Additional non-covered vision items are listed below:

t Cataract sunglasses (obtained in addition to the regular untinted lenses)

t Contact lens solutions

t Replacement glasses and lenses

t Scratch-resistant coating

Diabetic supplies

Glucose monitors and supplies

Medicare covers diabetic supplies for both insulin treated and non-insulin treated patients. Covered diabetic supplies include the monitor, lancets, spring-powered devices, and blood glucose test reagent strips.

Your physician must document the following information on the prescription:

t The number of strips to be dispensed

t Whether or not you are being treated with insulin injections

t The frequency with which you should use the supplies

The physician's order must be kept on file by the supplier and renewed every six months.

Suppliers must file your claims for diabetic supplies. Medicare does not accept diabetic supply claims filed by persons with Medicare.

External insulin pump

Medicare covers the administration of continuous subcutaneous insulin for the treatment of Type I diabetes when administered via an external insulin pump.

Insulin is covered for patients who have completed a comprehensive diabetes education program, have been on multiple injections of insulin (at least three injections per day), with frequent self-adjustments of insulin dose for at least six months prior to use of the insulin pump, and have documented self-testing of at least four times per day during the two months prior to insulin pump use.

Diabetic shoes

Diabetic shoes, inserts and/or modifications to the shoes are covered if:

t You have diabetes mellitus and

t You have one or more of these conditions:

a. Previous amputation of the other foot, or part of either foot, or

b. History of previous foot ulceration of either foot, or

c. History of pre-ulcerative calluses of either foot, or

d. Peripheral neuropathy with evidence of callus formation of either foot, or

e. Peripheral neuropathy with evidence of callus formation of either foot, or

f. Poor circulation in either foot.

Medicare-covered drugs

The Benefits Improvement and Protection Act of 2000 requires Medicare suppliers to accept assignment on Medicare-covered drugs. Some of these drugs are nebulizer drugs, oral anti-cancer drugs, immunosuppressive drugs and parenteral nutrition.

Immunosuppressive drugs

Following transplant effective December 21, 2000, there is no longer a 36-month time limit for drug coverage under this benefit. For persons whose benefits expired prior to December 21, 2000, drug coverage resumes on that date.

Parenteral and enteral nutrition therapy

Parenteral and enteral nutrition (PEN) therapy is covered by Medicare when a person with Medicare cannot swallow or absorb nutrients through oral feeding.

In the case of parenteral therapy, all or part of the gastrointestinal tract must be missing or nonfunctioning. Parenteral therapy is delivered into a central vein, since the inoperative gastrointestinal tract of the patient does not allow nutrients to be absorbed into the bloodstream.

Enteral therapy provides complete nutrition to a patient who cannot swallow or take food orally. Enteral therapy is tube feeding that is administered directly into the gastrointestinal tract.

If a patient meets the coverage requirements for PEN therapy, all nutrients, equipment, and supplies are covered by Medicare Part B. Medicare will pay for only one month's supply of PEN therapy items at a time.

Power operated vehicles

Power operated vehicles (POVs, or scooters) are covered when all of the following criteria are met:

t You require a wheelchair to maneuver in your home

t You cannot operate a manual wheelchair

t You can safely operate the controls of a POV

t You can transfer safely to and from the POV and have adequate trunk stability to safely ride in the POV

A Certificate of Medical Necessity (CMN) must be completed by a physician in one of the following specialties:

t Neurology

t Orthopedic surgery

t Physical medicine

t Rheumatology

If the ordering physician is not a member of one of the four specialties listed above, Medicare needs an explanation of the special conditions that prevent you from consulting such a doctor.

Important note

Medicare does not cover POVs if they are needed outside of the home only.

Seat lift mechanisms

If your physician prescribes a lift chair for you, Medicare may assist in paying for the seat lift mechanism.

Coverage is limited to the actual lift mechanism. You are responsible for payment of the chair itself.

Payment is allowed if all of the following coverage guidelines are met:

t You must have severe arthritis of the hip or knee, or have a severe neuromuscular disease

t You must be completely incapable of standing up from any chair in your home

t Once standing, you must be able to walk

t The seat lift mechanism must be part of the physician's course of treatment and be prescribed to improve, or arrest deterioration of, your condition

Your physician must complete a CMN. The supplier must submit the CMN, as well as your Medicare claim, to Palmetto GBA for processing.

Important note

Medicare cannot allow payment for a seat lift mechanism and a wheelchair or power operated vehicle at the same time.

If you have questions regarding Medicare medical policies, please call the toll-free number.

Focus on non-covered services

Please keep in mind that Medicare is a program of basic insurance; it is not a comprehensive insurance program.

Congress passes very specific laws that define benefits. The CMS then translates these laws into Medicare coverage guidelines.

There are many medical services and supplies that are accepted as medically necessary and reasonable, but they are not all covered by the Medicare program.

Some items and services not covered by Medicare are shown below:

Non-covered items and services

Here are examples of non-covered items and services:

Adult diapers	Oxygen furnished on an airplane
Air conditioners and heaters	Spare tanks of oxygen
Bathroom safety equipment	Stairway lift
Bathtub lifts	Support hose/stockings
CCTV	Syringes and/or needles
Communication systems	Telephone alert systems
Exercise equipment	Van lifts
Hearing aids	Wigs
Massage devices

1. I purchased a box of diabetic strips in May of 2002. How long does my supplier have to file a claim?

A. Federal law requires your supplier to submit a claim within one year from the date of service.

2. I lost my Medicare card. How do I get a new one?

A. If you lose your card, contact your local Social Security office or Palmetto GBA Service Center immediately to get a new one. Another alternative is to go to www.Medicare.gov.

Please protect your Medicare card just as you would a credit card. Your Medicare number in the wrong hands can be used to submit fraudulent claims.

3. Does Medicare Part B pay for prescription drugs?

A. Medicare does not cover most prescription drugs. However, if coverage guidelines are met, Medicare allows payment for some immunosuppressive, oral anti-cancer, oral anti-emetic, and nebulizer drugs.

4. My husband and I are traveling out of the country during the holiday season. If I purchase my medical supplies outside of the United States, will Medicare pay me back?

A. No. By law, Medicare does not cover supplies or services received outside of the United States. The United States includes the 50 states, District of Columbia, Commonwealth of Puerto Rico, Virgin Islands, Guam, American Samoa, and the territorial waters adjoining the above land areas.

5. Why is it important to have written verification (a "pick-up slip") when I return a piece of medical equipment?

A. If, at any time, you return a piece of medical equipment to a supplier, please obtain written verification that you have done so.

Written verification can be obtained at the place of business or provided by the store employee who drives to your home to pick up the equipment. The written verification must include the correct return date of the item and your dated signature.

This documentation helps Medicare recover any money received in error by the supplier, and could prevent fraudulent billing.

6. I rented a wheelchair for four and a half months. However, my supplier billed Medicare for five months. I called the Palmetto GBA service center and was told that this is the policy. Is that true?

A. Per Congress and CMS, Medicare must reimburse your supplier on a "monthly" basis. Rented items such as wheelchairs and hospital beds cannot be reimbursed on a "daily" basis.

7. I recently moved to another state. How do I update my address with Medicare?

A. To protect you and to ensure your receipt of your MSN, please let your Social Security office know that your address has changed. The number for the Social Security Administration is 1-800-772-1213.

8. Although I am able to walk, I have a difficult time walking long distances. Would Medicare allow payment for a wheelchair?

A. Medicare wheelchair coverage guidelines indicate that in order to allow payment for a wheelchair, a person with Medicare must be bed- or chair-confined without the use of a wheelchair. In this case, Medicare cannot allow payment.

Glossary

Actual charge

The amount a medical professional or supplier actually bills for a service or supply.

Appeal procedure

A procedure available to a person with Medicare or provider to contest an adverse decision made on a claim.

Approved amount

The amount Medicare says is reasonable for a covered service/item. This amount may be less than the actual charge.

Assignment

An arrangement between Medicare and a healthcare professional.

The professional agrees to accept Medicare's approved amount for covered services as complete payment. Medicare pays the professional directly.

Healthcare professionals who don't accept assignment may charge more than the Medicare-approved amount. Persons with Medicare pay these providers directly, then Medicare reimburses the person with Medicare for the approved amount.

Coinsurance

The dollar amount or percentage the person with Medicare pays for covered services.

Covered service/item

Specific services/items for which Medicare may pay.

Deductible

The annual amount you are responsible for paying for covered services before Medicare will pay its share.

Hospice

An agency or private organization which supports terminally ill patients and their families with symptom management, pain relief, and counseling.

Participating doctor, supplier, or provider

A physician, supplier, or other healthcare professional who agrees to accept assignment on all Medicare claims.

Skilled nursing facility

A Medicare-approved skilled nursing facility is a specially qualified facility. It must have the staff and equipment to provide skilled nursing care, a full range of rehabilitation therapies, and related health services.