Understanding Medicare means understanding the meaning of many unfamiliar terms. The following is a list of words and acronyms that are used when discussing Medicare or are important to give you a better understanding of how Medicare works.
Affordable Care Act (also known as the Health Care Law)
The Affordable Care Act (ACA) includes provisions to expand health coverage to eligible Americans, control health care costs, and improve the health care delivery system. The ACA closes the Medicare Part D donut hole/coverage gap and expands coverage of preventive services for people with Medicare. The Act also creates state-specific Marketplaces, where individuals can go to purchase health insurance. Generally, those with Medicare should not buy health insurance in the Marketplace.
Annual Notice of Change (ANOC)
The Annual Notice of Change (ANOC) is the notice you receive from your Medicare Advantage or Part D plan in late September. This notice gives a summary of any changes in the plan’s cost and coverage that will take effect on January 1 of the next year. Review this notice to see if your plan will continue to meet your health care needs in the following year. If you do not receive an ANOC from your plan, you should contact your plan. The ANOC is typically mailed with the plan’s Evidence of Coverage (EOC), which is a more comprehensive list of the plan’s cost and benefits for the upcoming year.
Benefit Period The benefit period is the amount of time during which Medicare pays for hospital and skilled nursing facility (SNF) services. A benefit period begins the first day you enter the hospital or SNF and ends when you no longer receive hospital care or skilled care in an SNF for 60 days in a row. With each new benefit period, you pay a new deductible. Your coinsurance is determined by the number of days you have been in the facility during each benefit period.
Insurance is designed to protect you from having to pay very high out-of-pocket costs. Catastrophic coverage usually begins after you have spent a pre-determined amount on your health care. Original Medicare Part A and Part B do not offer catastrophic coverage. They always pay the same amount regardless of how much you have spent. The Medicare prescription drug benefit (Part D) does offer catastrophic coverage. After you have spent a certain amount out-of-pocket, you will only pay five percent of the cost of each prescription drug (in addition to your monthly plan premium). Medicare private plans, like regional PPOs (Preferred Provider Organizations), may also have catastrophic coverage or caps on out-of-pocket costs, but these caps may exclude certain high-cost services. Also, Medicare Medical Savings Accounts (MSAs) must pay all or most of your Medicare Part A and B costs after you have met your deductible.
A discharge plan is a plan for post-hospitalization care intended to identify an individual’s need for medical and social services and resources available to help prevent re-hospitalization. A discharge plan must involve:
- input from you and your representatives about your preferences and care needs after hospitalization;
- information and instructions to you and your caregivers about post-hospitalization care you need; and
- arrangement of necessary post-hospital services, transfers, and referrals to appropriate services and facilities.
A Medigap is a supplemental insurance policy that is sold by private insurance companies to fill “gaps” in Medicare. This insurance policy is usually available in the form of twelve different plans labeled A through L and works only with Original Medicare.
EPIA inc. is a private Insurance Agency with no ties with legal entities. The information contained in this article is based on information provided by the Medicare Official Website.