Taking Care of Mom and Dad: Doctors and Medicare
The main reason that your parents should keep private-sector health coverage as long as possible is that using Medicare effectively requires a lot of paperwork and attention to bureaucratic detail.
About half of the doctors in the United States will accept the amounts paid by Medicare as payment in full. This is referred to as accepting the Medicare assignment.
If a pathologist or radiologist who performs services on an inpatient basis accepts a Medicare assignment, Medicare will pay 100 percent of reasonable charges. It will also pay the cost of a required second opinion for surgery with no 20 percent copayment. And it will pay for services of other specialists on the standard 80 percent of reasonable charges basis.
That's the easy scenario; others are more complicated.
Doctors who do not accept Medicare assignments are prohibited by law from charging more than 140 percent of the Medicare prevailing charge for office and hospital visits.
Some doctors try to circumvent the limits on what they can charge by making patients sign a contract to pay full charges. The Health Care Financing Administration has cautioned that these contracts are not valid. Don't let your parents sign them.
Doctors and other providers must submit claims for covered Part B services directly to Medicare. Some doctors ask patients to waive the right to have doctors submit Medicare claims and obligate the patient to pay privately for Medicare-covered services. These waivers are also invalid. Don't let your parents sign them.
If your parents' doctor doesn't accept their Medicare assignment, he'll send the bill for Part A services directly to them. In this case, they fill out a Medicare claim form and attach any itemized bills from the doctor -- including date and place of treatment, description of treatment, doctor's name, etc. The documents are then sent to a Medicare administrator in their area. Upon receiving the claim, the administrator will send an Explanation of Medicare Benefits, showing which services are covered and the amounts approved for each.
Medicare claims are sometimes paid on an indemnity basis, meaning directly to your parents -- usually after they've already paid the doctor. However, if the doctor or hospital has agreed to accept the amount reimbursed by Medicare as payment in full, benefit payments may also be made directly to the provider.
In the direct payment or reimbursement model, your parents pay a deductible for each benefit period, beginning with the first day of admission to a hospital and continuing for 60 days. If they are released or hospitalized for more than 60 days, a new benefit period begins and a new deductible applies. That's the bad news. The good news: There's no limit on the number of benefit periods they can have.
If a Medicare claim is denied, your parents can appeal the claim. Within six months of receiving the Explanation of Medicare Benefits notice, they must file a written request for review. The administrator will check for miscalculations or other errors. If the administrator declines to make a change, an appeal can be made to the Social Security office (but only if the amount disputed is $100 or more).
Your parents must appear in person to attend a hearing and present evidence, such as a doctor's letter, to support their point. A written notice of the decision will be sent to them after the hearing.
