By Betty Berry, Tuesday, April 19, 2011 Q: I am attempting to help an elderly relative with selecting health care coverage. I am so confused and I can’t believe that a senior is required to understand all of the options available. I have run into Medicare, MediCal, Medicaid, Medigap and Medicare Advantage. Everything starts with “M,” and they all sound alike. Also, can a senior only have one of these items or can they have a combination. Can you help a nonsenior make sense of all of this?
A: At first glance, this may seem overwhelming, but I think I can provide some definitions that will help clear up this confusion. Sorry about everything starting with “M,” but all plans mentioned are related to Medicare coverage, the main health care coverage for seniors, and “M” seems to be the common denominator.
Let’s take the items you mentioned in order and start with Medicare. Medicare is a nationwide, federally financed health insurance plan for the senior population (65 and older), the disabled (those eligible for Social Security disability benefits) and people on dialysis for chronic kidney disease. It is the major health insurance used by the senior population and has been in effect since 1965. Medicare is a fee-for-service program under which the cost is billed to the government. This option is one that remains today.
You next mention MediCal and Medicaid. I put these two programs together because they are basically the same. Medicaid is a federal health care assistance program that is designed to help pay medical expenses for low-income families. MediCal is California’s version of that federal program.
The MediCal program is jointly funded by the federal government and the state of California. Each state designs and administers its own program, and it is managed on a county basis. To be eligible for MediCal, coverage applicants must meet residency, age or disability requirements and must show need for financial assistance.
Medigap insurance is an additional coverage that is purchased by many seniors who are covered by original fee-for-service Medicare. Since Medicare does not fully cover health care costs, the purchase of a Medigap policy provides coverage for those expenses approved by Medicare but not included in Medicare’s payment. These policies also offer some additional coverage for items not covered under the Medicare system.
Last, but not least, is Medicare Advantage. Medicare Advantage, now known as Senior Advantage, was added to Medicare coverage in the 1980s and gave seniors a choice of how they wanted their coverage provided. This addition gave seniors a choice of selecting Medicare fee-for-service or assigning their coverage to an alternate plan. Medicare Advantage plans include HMOs and PPOs.
You asked if beneficiaries are restricted to only one type of coverage. Someone with Medicare fee-for-service is very likely to also have a Medigap policy and could also qualify for MediCal.
A person with an HMO or PPO would not need a Medigap policy but could qualify for MediCal. Those who have Medicare and MediCal are referred to as dual-eligible (previously called a Medi-Medi).
This is a very simple explanation of the various parts of the Medicare health care program, which is a very complicated plan. I hope it helps you to put the pieces together.
Betty Berry is an advocate for Senior Concerns. The advocates are at the Goebel Senior Adult Center, 1385 E. Janss Road, Thousand Oaks, CA 91362; phone 495-6250 or email betty@seniorconcerns.org (please include your telephone number). You are invited to submit questions on senior issues.
