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Medicare Enrollment Form

UNEXPECTED MEDICARE PENALTIES AND INCOME-RELATED ADJUSTMENTS: CAN YOU APPEAL? HOW?

Medicare can be confusing and lead to unexpected costs. This is especially true if you’re not informed on the front end when you first become eligible for Medicare; or, if you delay enrollment, when you enroll that first time. The three most common surprise-cost culprits sprung on those new to Medicare include:

1.)   Medicare Income-Related Monthly Adjustment Amount (IRMAA)

2.)  Part B late enrollment penalty (LEP)

  • For each 12-month period you delay enrollment in Medicare Part B, you may have to pay a 10% Part B premium penalty, UNLESS you have other credible coverage that is compliant with Medicare rules (such as insurance based on your or your spouse’s job-based insurance).

3.)  Part D late enrollment penalty (LEP)

  • For each month you delay enrollment in Medicare Part D (Prescription Drug Plan), you may to pay a Part D late enrollment penalty unless you have creditable coverage that is as good or better than the basic Part D benefit or get “extra help” (Low Income Subsidy).

The good news, if you want to call it that, is if you get dinged for income adjustments or penalties – Yes, you can appeal.

In cases of IRMAA adjustments you can request a new initial determination right out of the chute if you have experienced a life-changing event that caused an income decrease, or if you think the income information Social Security used in making the initial determination is incorrect. If you don’t agree, you can also file for reconsideration or file an appeal.

You can also appeal your Part B and/or your Part D Late Enrollment Penalties (LEP) though the processes for doing so are different for Part B and Part D.

For Part B LEP, just follow the instructions on the notice that you received informing you of the penalty. You will need to prove that you were enrolled either in Part B or in coverage through current employment during the period of time for which you are being penalized.

For Part D LEP, you can appeal the penalty if you think you were continuously covered or if you think the amount of the penalty was calculated incorrectly. This appeal must be filed with Medicare’s contractor (MAXIMUS Federal Services) for handling appeals.

For more information on adjustments, penalties and how to file an appeal refer to this month’s Medicare Minute Newsletter courtesy of The Medicare Rights Center.

And go to:

Medicare Part B Premium Appeals | HHS.gov

Medicare IRMAA Life Changing Event Form

Late Enrollment Penalty (LEP) Appeals

If you have questions, we are happy to help:
Email: 65Plus@bbginc.net
Phone: 866-845-8600; Ext 130

Medicare Basics: 5 Things to Know About Medicare Part A

There are four basic parts of Medicare: A, B, C, and D. Each part helps pay for certain medical services. Here are 5 things to know about Part A:

#1  Part A is one of two parts of what is considered “Original Medicare”. (Part B is the other).
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#2  Most people don’t have to pay a premium for Part A. They’ve already paid into the system in the form of the Medicare tax deductions in their paycheck if they (or their spouse) worked at least 40 calendar quarters (10 years) in the U.S.

#3  Medicare Part A helps cover the costs of inpatient care in the hospital, short-term skilled nursing facilities, home health care, and hospice care.

#4  Benefit periods apply. These benefit periods measure the use of inpatient hospital and skilled nursing facility services. Medicare will stop paying for your inpatient-related hospital or skilled nursing facility costs (such as room and board) if you run out of days during your benefit period.

#5  Most people either add a Medicare Supplement (Medigap) Plan or they opt to enroll in a Medicare Advantage Plan.  Both of these options in different ways can serve to limit liability, extend benefit periods, and cover some out of pocket costs (like deductible and coinsurance) associated with Medicare Part A.

You can read more about Medicare Part A covered services in this Medicare Minute Newsletter courtesy of the Medicare Rights Center.

 

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FSA and HSA Contribution Limits for 2020

Every year the Internal Revenue Service (IRS) announces new contribution limits for tax-advantaged accounts. Many of these accounts are indexed for inflation so the limits rise year over year. This article is geared at educating you about the new contribution limits for two tax-advantaged accounts in relation to healthcare.

Flex Spending Account (FSA) 2020 Limits:

FSA limits have been announced for 2020. If you have health insurance through your job, you can utilize an FSA for using pre-tax money to cover your out-of-pocket healthcare expenses. FSAs are more of a use it or lose it type of account so it’s best to estimate the amount of healthcare you typically consume before making your elections.

The IRS announced on October 31, 2013, that employers would be allowed to either offer a carryover or a grace period for FSAs effective in 2014. If you have access to an FSA through your employer we advise you check with them on whether or not they offer one of the following options:

  1. Two and a half months grace period in the new year to use up the previous year’s dollars
  2. $500 carryover to use in the new year

Here are the health FSA contribution limits for 2020 compared to 2019 and 2018:

Dependent care FSA limits are not indexed for inflation and so they remain at:

Health Savings Account (HSA) 2020 Limits:

If you are on an HSA qualified plan you are able to contribute to an HSA. If you qualify, HSAs have several benefits over FSAs:

  1. The contribution limits are higher
  2. You never lose the money
  3. You can invest HSA funds in mutual funds

Here are the HSA contribution limits for 2020 in comparison to 2019 and 2018:

Closing Thoughts

We realize healthcare costs continue to increase so any opportunity to save on taxes should be considered. Please check with your employer’s human resource department to confirm which of these accounts you may be eligible for.

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2020 Medicare Part B Monthly Premium and Income-Related Monthly Adjustment Amounts

On Friday Medicare announced the Part B rates that most Medicare enrollees will be responsible for paying in 2020.  Effective January 1, 2020 the standard monthly premium for Medicare Part B enrollees will be $144.60.  This represents an increase of $9.10 from the $135.50 enrollees paid in 2019.

Starting in 2007, a beneficiary’s Part B monthly premium has been based on income. Income-related monthly adjustment amounts (IRMAA) affect approximately 7 percent of all Medicare beneficiaries. The 2020 Part B premium levels adjusted for income as well as the Part D (Prescription Drug Plan) are shown in the following tables:

2020 Medicare Part B Income-Related Monthly Adjustment Amounts

 

Part D (Prescription Drug Plans) IRMAA in 2020

And, If your modified adjusted gross income is above a certain amount, you may also pay a Part D income-related monthly adjustment amount (Part D IRMAA).  Those amounts for 2020 are listed below.

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