If you’re worried about out of pocket spending for medical care when you have Medicare, you need to consider adding a private option to get some protection. Which option is good for you is a very individual matter. What’s good for one person may not be good for you. Choosing the optimal plan involves understanding how Medicare works, assessing your needs, and choosing a plan from a carrier that fits your needs. In this article, we will review how much you could potentially spend on medical care with Original Medicare, and how Cigna Medicare Plans can help you get the care you need while protecting your wallet.
The key to understanding what to do about your coverage is to understand how much your care will cost if all you have is Original Medicare. Original Medicare refers to Part A (hospital insurance) and Part B (medical insurance). While these are good coverages, there are definitely some glaring gaps. These gaps can range from costs you’ll have to pay out of pocket to services that aren’t covered by Original Medicare at all.
For starters, there are a number of costs that you’ll encounter when you use your Medicare benefits. These costs include:
An important aspect of these costs that you need to keep in mind is that there is no cap on your spending under the terms of Original Medicare. This is totally different from most other kinds of health insurance you’ve had before getting Medicare. Instead, you’ll keep paying the co-payments and co-insurances listed above, no matter how high your spending has become. This lack of a spending cap is one of the primary reasons that people choose to add some kind of private coverage to their basic Medicare benefits.
Besides these costs, there are also a number of services that aren’t covered by Medicare. These gaps include:
While these services aren’t covered by Original Medicare, they are covered by some of the private Medicare Plan options, including by Cigna.
Cigna traces its roots all the way back to the 1700s. Cigna was formed by the 1982 merger of Connecticut General Life Insurance Company, which was founded in 1865, and INA Corporation. INA Corporation was the parent of Insurance Company of North America, which was founded in 1792.
Historically, Cigna and its subsidiary companies have offered life insurance, health insurance, disability, dental, and property casualty insurance. Cigna has mostly spun off or sold its non health insurance and ancillary insurance products business.
Today, they have a large market share in the Medicare and Medicaid product market. They are ranked number 12 in the Fortune 500.
Cigna offers all three types of private Medicare coverage:
Next, we’ll review how CIgn’s Medicare Plans work.
Part D is the prescription drug program of Medicare. It is regulated by the federal government through the Centers for Medicare and Medicaid Services (CMS). Part D drug plans help pay for some of the cost for your prescription drugs.
Cigna Prescription Drug Plans have a formulary, which is a formal list of all the medications and vaccines that the plan covers. The formulary also assigns every covered drug a Tier. Higher Tier medications are more expensive, and tend to be brand name drugs.
Besides co-payments or co-insurance for your prescription fills, you can expect to encounter these costs:
All standalone Part D drug plans have a monthly premium. Most of them have a deductible as well. Once you’ve met your deductible for the year, you’ll pay co-payments or co-insurance based on the Tiers of your medications.There is no cap on your drug spending; you’ll pay co-payments all year long.
Cigna Medicare Prescription Drug Plans feature a network of pharmacies. You should use a pharmacy that’s in-network so that you get maximum savings on your medications.
Medicare ADvantage Plans are also referred to as Part C of Medicare. A Medicare Advantage plan is a contract between Medicare and a private insurance company; in this case, Cigna. A Medicare Advantage plan is required to cover all services and procedures that are covered by Part A and Part B.
Cigna Medicare Advantage Plans negotiate prices for medical treatment directly with providers like doctors, laboratories, and hospitals. The plan pays providers whenever you receive services and procedures. You will also pay a co-payment or co-insurance amount for all the care you receive. All of your spending during the calendar year is kept track of, and counts towards your annual Out of Pocket Maximum (OOPM) amount. Every Medicare Advantage Plan has an annual cap on spending, which is an improvement over your exposure to unlimited spending with Original Medicare.
Most Medicare Advantage Plans, including those from Cigna, are either HMOs or PPOs. Both types of plan have a network of providers. With HMOs, you must use network providers, or the plan won’t pay for any part of your care. PPOs are more flexible. With PPOs, you’ll pay lower costs if you use providers who are in the network. However, you can see out of network providers; you'll pay more than for in-network providers, but the plan will still pay part of your cost.
Many Medicare Advantage Plans offer what are called “extra benefits,” which are benefits and coverages for things not covered by Original Medicare. Common extra benefits can include:
Besides these, some Medicare Advantage Plans also provide emergency coverage outside of the United States. Many Plans, including Cigna Medicare Advantage Plans, also incorporate Part D prescription drug benefits. All of these extras are an improvement over Original Medicare.
Medicare Supplement Insurance, also called Medigap, is the oldest of the three private insurance options for lowering your out of pocket costs with Medicare.This kind of insurance works as a secondary coverage. This means that Medicare pays first, as the primary coverage; a Medigap plan then pays some (or all) of whatever costs are left over. When you see the doctor or get other medical care, you’ll pay with both your Original Medicare card, and your Cigna Medicare Supplement Plan card.
Medicare Supplement Plans work by paying some or all of the specific costs that you’d normally have to pay out of pocket. It doesn't matter what the service or procedure you receive is; Medigap plans are only billed for the amounts that you would otherwise pay. For example, assume you receive a knee replacement in an outpatient setting. Your surgeon, anesthesiologist, attending nurses and surgical technicians, as well as the outpatient surgery center will all bill Medicare for their services. Medicare will pay the first 80% of the costs they approve, assuming that you’ve already met the Part B deductible. The rest of the bill is sent to your Medigap plan. Your Plan will pay most (or all) of the 20% that you’d normally have to pay. As long as your claim was approved by Medicare, your plan will pay their share.
Medigap plans are sold in ten standardized forms in 47 of the U.S. states. These plans are identified by Plan Letter: A, B, C, D, F, G, K. L, M, and N.Each one of them offers a slightly different benefit level. You can choose your level of coverage by selecting the Medigap plan that best fits you. Since the benefits are standardized in the 47 states, the coverage is identical: Plan A is always the same, no matter which state you live in, for example.
Cigna Medicare Supplement Plans are available on a state by state basis. They don’t offer all ten standardized plans in all 50 states. Instead, they choose which plans to offer on a state by state basis. However, the most popular Medigap Plans have historically been Plans A, F, G, and N. Note that Plan F is only available for people who became eligible for Medicare before January 1, 2020.
Not necessarily. You need to be actively enrolled in both Parts A and B for either Medicare Advantage or Medicare Supplement Insurance. In some states, you may need to be age 65 or older to get Medigap, but there’s no minimum age requirement for Part D drug plans or Medicare Advantage.
You can combine Part D drug coverage with Medicare Supplement Insurance. But, you can’t combine Medicare Supplement and Medicare Advantage. You also cannot generally combine Medicare Advantage with a standalone Part D drug plan.
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