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Millions of Americans have diabetes and it is one of the costliest health conditions to treat. Americans older than age 45 have an increased risk of diabetes, so it’s normal for people to ask about how well Medicare covers diabetes treatment.
Medicare has several parts, and treatment for diabetes may occur under each part. In this article, we’ll explore how each part of Medicare covers diabetes so that you’ll know exactly which costs to expect. Since Medicare doesn’t cover everything, we’ll also explain how Medigap plans can help with some of the cost-sharing that would be normally up to you.
Diabetes and Medicare Part A
Your inpatient hospital care falls under Medicare Part A. Your Part A also covers skilled nursing, home health care, blood and hospice care when needed. Should you have an inpatient hospital stay for diabetes or anything else, you will owe a deductible ($1316 in 2017).
After that Medicare covers the first 60 days in the hospital. On Day 61, you will begin to incur a daily copay that gets greater over time. Your benefits run out at Day 150.
Fortunately, it is uncommon for someone to have a hospital stay that long, so we don’t see people in that situation. A Medigap plan will provide an additional 365 days of coverage.
Sometimes after a surgery or long illness, you may need skilled nursing facility care. Medicare Part A covers 20 days with no cost-sharing from you. After that, you have an additional 80 allowed day in skilled nursing, but you will pay a daily copay as well. Again, a Medigap plan can cover this for you.
Diabetes and Medicare Part B
Medicare Part B covers your outpatient needs. This medical coverage provides doctor’s visits, lab-work, preventive care, surgeries, durable medical equipment and much more.
Very importantly, Part B also covers test strips, lancets and glucose meters as well as glucose control solutions.
Your cost-sharing starts with an annual Part B deductible, which is $183 in 2017. After that, Medicare pays 80% and you must pay the other 20%. This is a concern because 20% of hundreds of test strips every year can be quite expensive. Fortunately, Medigap plans will pick up the other 20% for you. We’ll discuss how those work further below.
It’s important to mention that Medicare itself has a competitive bidding program to keep your costs for diabetic supplies low. You can also order these supplies through a national mail order vendor for additional savings.
Diabetes and Medicare Part D
Many people with diabetes take oral medications or inject themselves with insulin. These medications fall under Medicare Part D, which is your retail drug coverage.
Part D is voluntary; you are not required to purchase it. However, some diabetes medications can be quite expensive, and Part D helps to greatly reduce the cost of those medications.
Each state has many different insurance companies offering Part D. The company decides how much it will charge for the plan. This is called your monthly premium. Premiums can range anywhere from $15/month to well over $150/month depending on the company you choose.
The individual insurance companies also determine the pharmacy network, drug formulary and copay or coinsurance for each medication. Most plans have a 5-tier formulary, with generics being the cheapest, and specialty drugs being the most expensive.
You can look your medications up in the drug plan’s formulary to find out what your copay will be for each one. We also highly recommend the plan finder on www.medicare.gov. You can enter your medications and your preferred pharmacies, and Medicare will tell you exactly which plans will be most effective for you.
If you start a new medication that is not on the plan’s formulary, then you can ask your doctor to request an exception for you to see if the insurance company will cover it.
How to Cover the Gaps in Medicare
It would be great if Medicare covered 100% of care. However, since it doesn’t, you should prepare for how you will pay for the deductibles and coinsurance that Medicare doesn’t pay.
Since the 1960s, Medigap plans have been one of the best ways to fill in the gaps in Medicare. There are around 10 standardized plans to choose from, which makes them easy to compare.
For well over a decade, Medigap Plan F has been one of the top-selling plans. This is because Plan F is the most comprehensive policy that you can buy. It covers both your Part A and B deductibles. It also pays for the 20% that Part B does not.
If you are someone who will worry about bills that you may owe, then Plan F is a great choice. Since it picks up all of Medicare’s cost-sharing that you would normally pay, you will not need to get out your wallet.
Other plans like Medigap Plan G offer slightly lower premiums than Plan F because you will pay the $183 Part B deductible. This is an annual deductible, so you only pay it once, at your first outpatient treatment of the year. After that, everything is covered just like Plan F.
Qualifying for Medigap
Many people with diabetes worry that they will not be able to qualify for a Medigap plan. You need not worry. When you turn 65, you will be given a six-month period called your Medigap open enrollment period. During this period, you can apply for any Medigap plan without medical questions. You are guaranteed to be issued the policy.
Likewise, if you are coming off an employer health plan, you will have a shorter 63-day window to switch from your employer insurance over to Medicare and Medigap with no pre-existing condition exclusions. A Medicare insurance broker who specializes in Medicare can help you find a suitable plan in your area.
Medicare Part C Plans
In the late 90’s, Congress introduced Medicare Part C, which is now known as Medicare Advantage. These plans are a private option that you can choose to administer your Medicare Part A and B benefits instead of Medicare. Often Advantage plans have lower premiums than Medigap plans.
However, there are some differences you’ll want to be aware of. The most important one is that Medicare Advantage plans have their own network of doctors. These might be HMO or PPO networks. On HMO networks, you must choose a primary care physician and you will probably need to get a referral from him if you want to see a specialist.
Some Medicare Advantage plans operate a PPO network. These have more flexibility, allowing you to treat outside the network at a greater cost to you. Check with your important doctors, such as your endocrinologist, to be sure that they are in the network before you join a Medicare Advantage plan.
Diabetes is a manageable illness, and Medicare’s coverage of treatment is thorough. You will have access to both doctor and medications to help you. Medicare covers most of the cost of your treatment, but there are voluntary programs like Medigap or Medicare Advantage to further help you fray the costs. Find an insurance broker who specializes in Medicare insurance to help you review the plan options in your area.
Danielle Kunkle is a Medicare expert on the Forbes Finance Council and founder of Boomer Benefits an award-winning insurance agency founded in 2005.