Surprise: Medicare Premiums Won’t Rise in 2009

Written By: Attorney Jeffrey A. Marshall, CELA*

The Centers for Medicare and Medicaid Services (CMS) has announced the new Medicare premiums and deductibles for 2009.  In a pleasant surprise for seniors, the standard Medicare Part B monthly premium will be $96.40 in 2009.  This is the same amount as the Part B premium for 2008. This is the first year since 2000 that there was no increase in the standard premium over the prior year.

This monthly premium is paid by beneficiaries enrolled in Medicare Part B to cover a portion (25%) of the cost of physicians’ services, outpatient hospital services, certain home health services, durable medical equipment, and other items.  Normally, the Part B premium increases at the same rate as average Part B expenditures from year to year.  However, while expenditures will likely increase in 2009, a premium increase will be avoided this year due to the adequacy of the reserve in the Medicare Part B trust fund. That reserve gained $9.3 billion earlier this year after officials discovered money was inadvertently being drawn from Medicare Part B to cover hospice benefits that should have been paid by Medicare Part A. 

The freezing of the Part B premium is expected to last only one year.  Because one-time events led to next year's premium relief, Medicare officials expect 2010 rates to rise.  A few higher income Medicare beneficiaries will nevertheless see their premiums increase in 2009.  About 5 percent of the nearly 44 million people in Medicare are subject to a higher premium due to an adjustment that is based on their income. Congress approved higher premiums for wealthier beneficiaries as part of the Medicare Modernization Act in 2003.  Individuals earning more than $85,000 and couples earning more than $170,000 are affected. The amount of their premiums will range from $134.90 to $308.30, depending upon their incomes.

Some beneficiaries can eliminate the premium. About one-fourth of Medicare beneficiaries are eligible for assistance that will pay for their entire Part B premium.  (For more information on premium assistance see our article "An Alphabet Soup for Saving on Medicare Costs: QMB, SLMB and QI" at http://www.paelderlaw.com/capchanges.html). Unfortunately, many of the seniors who are eligible for this help with Part B premiums do not receive it either because they are unaware of its existence or find it too difficult or confusing to apply. 

The Part B annual deductible will also be unchanged in 2009 at $135.

Medicare is a federal health insurance program for people 65 years of age and older, some disabled people under 65 years of age, and people with end-stage renal disease.  Medicare plays a significant role in providing health care in the United States.  In Pennsylvania, over 2 million people (17% of the population) are Medicare beneficiaries.

The announced Medicare Parts A and B deductibles, premiums, and co-pay amounts for 2009 are as follows:

Medicare Hospital Insurance (Part A)  (Medicare Part A pays for inpatient hospital, skilled nursing facility, hospice, and certain home health care services):

- Deductible - $1,068 per benefit period (was $1,024 in 2008).  The Part A deductible is the beneficiary’s only cost for up to 60 days of Medicare-covered inpatient hospital care in a benefit period. 

- Coinsurance - $267 a day for the 61st through the 90th day (was $256 in 2008), per benefit period; $534 a day for each "nonrenewable, lifetime reserve day" ($512 in 2008)

- Skilled Nursing Facility Coinsurance - $133.50 a day for the 21st through the 100th day Medicare covered days per benefit period (was $128.00 in 2008)

- Hospital Insurance Premium - $443 (paid by those few seniors who do not have 30 quarters of coverage through themselves or a spouse)

- Reduced Hospital Insurance Premium - $244 (paid by those seniors who have under 40 and between 30 and 39 quarters of coverage).  

Medicare Medical Insurance (Part B)

- Deductible - $135 per year (unchanged from 2008)

- Monthly Premium - $96.40 (unchanged from 2008)

Medicare Part D

Based on the bids submitted by Part D plans, CMS estimates that the average monthly premium that beneficiaries will pay for standard Part D Medicare prescription drug coverage in 2009 will be $28.00. This is about 37 percent lower than originally projected when the benefit was established in 2003.  The average expected premium for basic coverage in 2009 is about $3.00 higher than the actual average for 2008.

Under Part D, beneficiaries with low incomes can receive valuable extra assistance with their drug plan premiums and cost-sharing.  Nearly 10 million beneficiaries are currently receiving drug coverage for little or no cost through the Low-Income Subsidy (LIS) benefit.

The average value of the Part D benefit, premium subsidy, and cost-sharing subsidy for low-income enrollees is estimated to be about $3,900 in 2009.    

For further information see the Federal Register / Vol. 73, No. 186 / Wednesday, September 24, 2008 / Notices.   

Attorney Marshall can be contacted at webmail@paelderlaw.com or at 1-800-401-4552

LIFE (Living Independently for Elders) Offers a New Community Based Care Option

Written By: Perry Landon, Executive Director of Albright LIFE

LIFE (Living Independently for Elders) is Pennsylvania’s version of the program known nationally as PACE (Program of All-Inclusive Care for the Elderly).  This model of care is centered around the belief that it is better for the well-being of seniors with chronic care needs, and their families, to be served in the community whenever possible. A full range of preventive, primary, acute and long term care services are provided by LIFE programs, so that participants can live in the community as independently as possible.

This model of care began in the early 1970’s in the China-Town Beach area of San Francisco, where a non-profit corporation was formed to create a new community based system of care.  Over the next 30 years, this model of care developed, with the first programs receiving Medicare and Medicaid “waivers” to operate in 1990.  The Balanced Budget Act of 1997 established the PACE model as a permanently recognized provider type under both the Medicare and Medicaid programs.

Until recently, PACE (LIFE) programs were established in urban neighborhoods, with designated service areas defined by zip codes covering a few city blocks.  More recently, states, including Pennsylvania, have begun to expand the services into rural settings, with designated service areas defined by county boundaries. 

Like the aging waiver program, LIFE serves individuals who are 60 years of age or older, who would otherwise qualify clinically to be in a nursing facility, but who choose instead to remain in their homes with the support of LIFE program services.  The National PACE Association describes the typical participant as very similar to the average nursing home resident: 80 years of age; 7.9 medical conditions and limited in approximately three activities of daily living.  Forty nine percent of PACE participants have been diagnosed with dementia.  Despite the high level of care needs, 90% of PACE participants are able to continue to live in the community.

PACE/ LIFE services are comprehensive in nature.  Services can include: 1) Adult day health center, that provides nursing; physical, occupational and recreational therapies; meals; nutritional counseling; social work; and, personal care; 2) Medical care provided by the Albright LIFE primary care physician; 3) Home health care and personal care; 4) All necessary prescription drugs; 5) Social services;  6) Medical specialists such as audiology, dentistry, optometry, podiatry, and speech therapy; 7) Respite care; and, 8) Hospital and nursing home care when necessary. Because the LIFE interdisciplinary health care team authorizes and coordinates their care, Participants and their families see the program as a one-stop shopping alternative that simplifies their access to health care.

Clinical eligibility for participation in LIFE programs is determined through an assessment done by the Area Agency on Aging, in cooperation with the individual’s personal physician. The level of care is called “nursing facility clinically eligible.”

Payment for Albright LIFE services may come from Medicaid and Medicare or from private funds.  Long term care insurance may also be a source of payment for LIFE services. To qualify for Medicaid to pay for LIFE services, the individual’s available income and available resources must be at or below certain ceilings. The available income ceiling is 300% of the federal benefit rate, which is currently $1,911 a month. The available resource ceiling is $8,000. The Medicaid program does allow individuals with income in excess of the ceiling to qualify for Medicaid benefits by paying a monthly share of the cost of LIFE services, with Medicaid paying the monthly remainder.  If an individual wishes to pay privately for participation in the LIFE program, his/her monthly premium is equal to that amount that would otherwise be paid by Medicaid. Currently that monthly private pay premium amount is $4,178. 

You can learn more about PACE by logging on to the National Pace Association website at www.npaonline.org or log onto the PA Office of Long Term Living web site at www.dpw.pa.us and select Information for Families and Individuals, and scroll down to LIFE.

Marshall, Parker & Associates has a complete listing of current LIFE Programs in Pennsylvania (as of September 2008) on its website at www.paelderlaw.com/LIFE.html .

Perry Landon is the Executive Director of Albright LIFE in Lycoming and Clinton Counties.  He can be contacted at 322-5433 or at perry.landon@albrightcare.org.

Why Do Women Need an Estate Plan?

Written By: Attorney Tammy A. Weber

Statistics tell us that women live longer than men,¹ earn less than their male counterparts², have smaller pensions and social security benefits than men³ because of a career hiatus to have children or care for aging parents,⁴ and often opt out of pension plans because of a need for current income.  Married women tend to have their husbands handling the finances and planning their estate and retirement. 

Then, an unanticipated change occurs – divorce, severe illness, incapacity, death.  Estate planning and estate administration attorneys see the devastating effects of this failure to plan for the crisis.  Women, whether married, single or in a committed relationship, should educate themselves about their current situation and be active participants in planning for their financial future. 

Here are a few questions to get you thinking --

– If you pass away today, would your money and assets go where you want them to?  If you are single with no children and no will, your assets will go to your parents if they are living.  Perhaps you would prefer a charity or a niece or nephew . . . Pennsylvania’s plan for people who pass away without a will may not match your plan.

- Are people dependent upon you financially or for their care? For example, are your children minors or do they have special needs?  Have you picked a guardian for your children or for the money they will inherit from you?  This is especially important if you are divorced from their other parent.  Are you the caregiver for an aging parent or a special needs child?

- Do you wish to leave your assets to someone the rest of your biological family would not approve of?  There are ways to minimize the possibilities of challenges to your estate after you are gone.

- If you are divorced, have you updated your plan?  Most plans are voided by divorce; however, some beneficiary designations are not.

- Do you own land with other persons?  You may believe that when you pass away, your portion of that land will go to your children, but it will depend upon the wording of the deed.

- Have you made arrangements should you need long-term care?  Is long-term care insurance a possibility?

- If your husband passes away, do you know if you will receive any portion of his pension or retirement?  Your income stream may change drastically.

- If you become mentally incapacitated, have you appointed an agent to handle your financial affairs?  If not, your loved ones may have to go to Court and try to get appointed to be your Guardian. 

Several documents are necessary for the protection of one’s goals, assets and loved ones:

- Financial Power of Attorney – establishes who will handle your financial affairs and decisions should you become mentally incapacitated; also outlines the degree to which the agent can handle your funds.

- Health Care Power of Attorney – although Pennsylvania now has default provisions as to who can make your health care decisions should you be mentally incapacitated, those persons may not be the ones you want in charge of your health care. 

- Will – provides for distribution of your assets and who you would like to be in charge of this distribution.                           

Each person’s situation is unique.  It is important to consider all of the issues above as well as how they interrelate to your specific circumstances.

1. http://geography.about.com/od/populationgeography/a/lifeexpectancy 

2. http://www.swivel.com/graphs/show/22519323

3. http://www.latimes.com/business/investing/la-plan4retire-story2,1,4640911.story 

4. http://www.womenseverything.com/womens-pensions-c352.html

Attorney Weber can be contacted at webmail@paelderlaw.com or at 1-800-401-4552

Join Marshall, Parker & Associates in the Fight to end Alzheimer’s Disease

Written By: Melissa Bottorf

With the leaves quickly beginning to turn and the air becoming brisk, it can only mean one thing—Memory Walk season is right around the corner.

Every October the Alzheimer’s Association kicks-off their number one fundraiser to help people and families battling Alzheimer’s Disease. Families, friends and professionals gather together for Memory Walks across the nation. It’s a time to remember those we have lost to Alzheimer’s, honor those who are fighting it now and raise awareness and money so one day we will have a cure.

The staff at Marshall, Parker & Associates will participate in the Lycoming-Clinton and Wilkes-Barre Memory Walks. If you would like more information or to make a donation to our team, please contact Melissa at mbottorf@paelderlaw.com.  We hope to see you on October 11th.

October 11, 2008- Kirby Park in Wilkes-Barre

Registration at 9:00 AM.  Walk Begins at 10:00 AM

October 11, 2008 at Indian Park in Montoursville

Registration Begins at 10:00 AM.  Two-Mile walk begins at 11:00 AM.

Events & Entertainment from 10:00 AM until 2:00 PM.

Classic Car Cruise-In – Children’s Games – Chinese Auction – Food – Goof Troupe Clowns – Memory Board – DJ Jake Michaels

Melissa can be contacted at webmail@paelderlaw.com or at 1-800-401-4552

Community Invited to Hear Dr. Nesbitt Speak on End-of-Life Care

How would you like to live at the end of your life? What can you do to help your family and doctors make sure you get the right care? What do you tell your clients?

On Wednesday, October 29, 2008, the Northcentral Pennsylvania Estate Planners Council will hold a Presentation and Luncheon at the Williamsport Country Club on End-of-Life Care and Advance Directives.  The luncheon will be served at Noon with the one-hour program beginning at 12:30 PM.  Dr. Alexander Nesbitt will be the featured speaker.

Dr. Nesbitt is the Medical Director of Susquehanna Hospice and Palliative Medicine in Williamsport, PA.  He received his Medical Degree from George Washington University School of Medicine and completed his residency at North Memorial Medical Center in Minnesota.  He is Board Certified in Hospice and Palliative Medicine and works full-time overseeing Hospice care in patients' homes and in the inpatient Hospice unit, The Gatehouse.  He is also the director and coordinator of the Lycoming County POLST (Physician Ordered Life Support Treatment) Project.  Dr. Nesbitt is responsible for developing and implementing a countywide process of documenting and carrying out advance care planning preferences for patients in health institutions across the county. 

The cost for this luncheon and presentation for members of the Council is $15; $20 for nonmembers.  There will be one continuing legal education credit available for an additional fee of $15; and one CPE available for no additional cost.  Kindly note on your check whether you will be requesting CLE or CPE credit.

Please make your check payable to Northcentral Pennsylvania Estate Planners Council and mail it to Amy Dowling, Citizens & Northern Bank, Trust & Financial Group, 130 Court Street, Williamsport, PA 17701.  The deadline is October 24.

For additional information on the Northcentral Estate Planners Council, please visit www.paestateplanners.org.