50% out of network...Primary vs Secondary

[OHenry]

I am not an agent but hope someone can help me to help my sister with who has stage 4 cancer. She may have to go to MD Anderson (out of network) and also VERY expensive oral target drugs are something i have to consider in helping her decide on insurance

She has a Group plan at work with greater than 20 employees enrolled. So Group is primary, plus have brand new Medicare Part A & B coverage plus a Supplemental Plan

The GROUP plan
1. Has an OUT OF NETWORK ded of $12,000
2. Pays 50% OUT OF NETWORK.
3. OUT OF NETWORK Max out of pocket is $19,500.

1. I assume that she would pay the $12,500 ded before any benefits. (And assume that is not reimbursed by my Supp plan)
2. After that, the Group would pay 50% of covered benefits and Medicare and the Supplemental Plan would pay the remaining 50% as 2nd and 3rd payers.
3. I would next assume that the Group's max out of pocket would not kick in at all since everything is being paid by all 3 payers ie. Group, Medicare, Supplemental)

Does anyone know with a degree of certainty if I am understanding this so far?

I will be glad to share why on earth anyone might want to consider having BOTH a Group plan AND a Supp Plan once I am sure I am sure that my understanding of the above is correct. Thanks for any help!

 

[Chazm]

I don’t deal with group plans so I may be way off here but if she has Medicare a and b plus a supplement, why would she need her group plan?

The Medicare supplement plan blows that group plan out of the water.

Are you sure she has a group plan, Medicare A and B and a supplement? Something sounds off

 

[OHenry]

Thanks Chazm.

Yes the coverage she has is as I stated. As you said, I realize that it is strange that anyone would keep the Group plan while they have medicare A and B plus a Supp and a part D drug plan

BUT The reason I think that she may want to keep the Group plan is because it pays 100% of prescription drugs.

What I found out is that she has some VERY expensive oral target cancer drugs that she has to take. These are taken at home and are on her formulary and purchased at Walgreens. IF she did NOT have the Group plan, and only had her medicare A, B and SilverScript, she would enter the catastrophic phase almost immediately and would have to pay the 5% co pay. One target drug is $30 something THOUSAND dollars and she would end up paying OVER about $1,500 per MONTH for her 5% co-pay! It is possible she will only take this drug for a few months, but it is also possible that she might have to take it a full year along with maybe other expensive drugs.

So, this is what I have to decide ASAP since she will be going to MD Anderson soon and the Group plan has a $12,000 deductible for out of network!. So on one hand having the Group plan protects her from high drug cost, but on the other hand the Group plan's $12,000 ded is a big number!

 

[bluediamond]

Medicare: How it works with other insurance, called Coordination of Benefits

 

[somarco]

She has a Group plan at work with greater than 20 employees enrolled. So Group is primary, plus have brand new Medicare Part A & B coverage plus a Supplemental Plan

Doesn't need EGH plus Medicare plus Medigap. Needs to drop something.

If she is under 65 probably paying arm and leg for the Medigap, so drop that and keep EGH plus A/B.

MD Anderson (out of network) and also VERY expensive oral target drugs are something i have to consider i

Oral Rx covered under Medicare D, not B.

The GROUP plan
1. Has an OUT OF NETWORK ded of $12,000
2. Pays 50% OUT OF NETWORK.
3. OUT OF NETWORK Max out of pocket is $19,500.

Lotsa bucks.

1. I assume that she would pay the $12,500 ded before any benefits. (And assume that is not reimbursed by my Supp plan)
2. After that, the Group would pay 50% of covered benefits and Medicare and the Supplemental Plan would pay the remaining 50% as 2nd and 3rd payers.
3. I would next assume that the Group's max out of pocket would not kick in at all since everything is being paid by all 3 payers ie. Group, Medicare, Supplemental)

You are assuming wrong . . .

If you go outside your employer plan's network, it's possible that neither the plan nor Medicare will pay.
How Medicare works with other insurance | Medicare

The reason I think that she may want to keep the Group plan is because it pays 100% of prescription drugs.

Better validate that. I would be VERY surprised if that is accurate.

MIGHT qualify for some kind of drug manufacture rebate

 

[OHenry]

Doesn't need EGH plus Medicare plus Medigap. Needs to drop something.

If she is under 65 probably paying arm and leg for the Medigap, so drop that and keep EGH plus A/B.



Oral Rx covered under Medicare D, not B.



Lotsa bucks.



You are assuming wrong . . .

If you go outside your employer plan's network, it's possible that neither the plan nor Medicare will pay.
How Medicare works with other insurance | Medicare



Better validate that. I would be VERY surprised if that is accurate.

MIGHT qualify for some kind of drug manufacture rebate

 

[OHenry]

Thanks for comments Somarco

I apologize for repeating myself and making this thing so dam lengthy. I think it somehow helps for me to see it it in print over and over. OR maybe it is my fried ex ins adjuster brain that is the blame.

1. My sister is 65yo, So the medicare/supp premiums not as bad as they could be..

2. According to her Group policy which I am looking at now, it does in fact pay only 50% for Out of Network. with a max OOP for Out of Network of $19,500. So if i keep the Group, I would also have to keep the Medicare and Supp plans as secondary payers to pick up the remaining 50%. This in effect would theoretically leave no OOP. for her planned out of network visit (or visits) to MD Anderson.

3. The reason I would want to KEEP the Group is because of those expensive cancer oral drugs. They are presently covered by her Group plan at 100%. (There is a max out of pocket for her IN-network Group plan of $6500. That max OOP includes A,B, and D). This is why I am considering keeping the Group. (IF I were to DROP the Group, the oral drugs would be covered under medicare/SilverScript BUT..... and this is a BIG BUT....she would have to pay 5% of any drug cost once in the catastrophic phase. This could be as high as $1500 per MONTH or more ($30,000 x .5%).. So this is why I am thinking she might want to keep the Group.... ie. in order to avoid these VERY high catastrophic 5% payments.

4. On the other hand, the reason I am thinking about dropping the Group is because of the $12,000 out of network deductible which would immediately be due if she goes to MD Anderson..... but again, doing that would mean she would have to deal with those 5% catastrophic payments. IF the drug OOP cost would be lower than usual (say less than $12,000 per year) than maybe she should roll the dice and drop the Group and just keep the Medicare and Supp plan as most people would do that do not have these super expensive drugs to pay for in the catastrophic phase.

SO MY CHOICES ARE
1. To drop Group as my primary, and allow my medicare/supp to be primary. or
2. To drop Medicare/Supp, and allow my Group to be primary or
3. Keep both, as it is now, with Group as primary and medicare/Supp as 2nd and 3rd payers.

SUMMARY OF EACH CHOICE
1. Dropping Group and keeping Medicare/Supp..... She would then have to pay for the 5% catastrophic drug cost (since I would NOT have the 100% drug payment coverage that Group offers)I Without Group I would also have to pay the $6,350 for OOP cost that precedes reaching the catastrophic 5% phase while having medicare D as my primary

2. Dropping Medicare/Supp and keeping Group..... She would have to pay the Group's $12k ded AND the 50% out of network cost up to $19,000 OOP for out of network claims.

3.. Keeping both Group as primary AND Medicare/Supp as secondary payers as it is now..... She would only have to deal with the $12K out of network ded. (and $3,000 IN-network ded) Everything else should be covered with no OPP since the secondary medicare/supp are picking up those OOP'S that take place in the Group plan.

I think I can safely say that option 2 is NOT a good idea. So that leaves options 1 and 3.

My sister pays $250/mo for her employee Group plan. I think that when u are dealing with a very serious condition, like stage 4 cancer, the premium amounts are not as relevant. I think it is the coverage and protection of your assets that you have to think more about.

Please let me know where I might be driving off the cliff! Any comments appreciated..

 

[somarco]

Medicare as a secondary payer RARELY pays anything. In fact, I was surprised when they paid something on my wife's hospital bill. My guess is this is what happened.

Her group deductible (all cause) was $3500 in 2019. Had not been met when the claim was incurred.

Medicare Part A deductible in 2019 was $1364. The difference in the deductible (3500 - 1364) was $2136 which is approximately what Medicare paid.

When MSP claims are involved Medicare first looks at the claim AS IF they were the primary payer. If the primary carrier pays more than Medicare pays MORE than Medicare would have, Medicare pays nothing as the secondary.

Medicare has no networks. All providers are "in network"

My GUESS is, Medicare would look at the MDA claim as if they were primary and pay for the hospital INPATIENT portion.

Oral meds generally not covered by A or B unless. Meds administered in a clinical setting usually are covered, especially if inpatient.

If her oral meds are taken as an outpatient they would normally fall under Part D.

So it MAY be possible that the lions share of her INPATIENT stay at MDA would be covered by Medicare Part A. And her oral meds covered by the GHP.

Caveat.

I NEVER advise clients on specific claims. Too much liability if things don't work out.

My comments above are not to be considered specific advice but merely speculation on what COULD happen.

UPDATE
Reading this again I noticed this comment.

Everything else should be covered with no OPP since the secondary medicare/supp are picking up those OOP'S that take place in the Group plan.

Not how MSP works. See explanation above.

Claim adjudicated by Mcare AS IF they were primary, then they subtract out what carrier pays. Then they pay accordingly which means there may be some OOP.

 

[OHenry]

Thanks for the comments!

1. i think i may have misspoke or given the wrong impression. RIGHT NOW my sister only has EGHP and Medicare A & B (NOT D silverscript). I would only get the SilverScript IF i end up dropping the EGHP.

With this in mind, the EGHP as primary should do as it has always done regardless if I keep medicare/Supp or not. That is, the EGHP will pay 100% of all prescriptions after the all-inclusive max OOP of $6,750 is reached. So basically she WOULD have to pay $6750 to reach the max OOP for her expensive oral drugs, and then pay ZERO dollars after that. This is the ONLY reason I am considering keeping the EGHP. I do not want to keep repeating myself, but if she were to drop the EGHP, and only have Medicare A, B/Supp/D Silverscript, She would quickly reach Medicare's 5% Catastrophic stage 4. . This could cost her as much as $20k or $30k per year! Now IF she does NOT take these expensive target drugs in 2020 and beyond (and that is a possibility) then it would be a no-brainier. In that case, I would drop the EGHP., and only have Medicare A, B and D. and Supp. (Yes i would be able to get D SilverScript if she were to drop EGHP.)

2. I was on the phone with the main COB office twice about a week ago. I talked to 2 different COB workers. After repeating to them basically what i am saying here, I was told by each of them that my understanding of this was correct. One of the reps seemed experienced, and the 2nd one not.so much. There is a lot riding on this, so i am thinking of making a 3rd call.

3. I specifically asked them both if Medicare/Supp, as 2nd and 3rd payers, would pick up the $12,000 deductible that would be incurred by the EGHP for the visit to MDAnderson. They both said it would NOT! (So I am not sure if, or how, Medicare picked up the deductible in the case of Somarco's wife's claim.) . I will ask COB about that again. I REALLY hope that Somarco's speculation turns out to be right! That would save her $12k if I had to keep EGHP.

Now the reason that i am here is because I understand that that my sister's circumstances are more complex than most. She still has the opportunity to keep her EGHP, or keep both EGHB and Medicare/Supp. or drop one or the other. That does not always happen when you knee-jerk drop one policy or the other to soon and maybe do not have the opportunity to get it back

I think her decision will depend on if it is likely or not that she will have to take the expensive oral drugs in 2020. If I drop the EGHP, and she ends up having to take those expensive drugs for 2020, and maybe beyond, then I would have made a mistake by dropping her EGHP

So I am thinking that my sister will have to have a talk with her doc this Wednesday. IF the doc feels that continuing to take these super expensive oral drugs for more that a few months a year is NOT likely, then I can think about dropping EGHP and simplify things a LOT by having ONLY the Medicare A,B/Supp plans.....and add the D SilverScript. The only problem with that is that if the doc guesses wrong, my sister could end up paying $20 or $30K a year more by having to face Medicare's catastrophic drug stage once you go past the $6350 cost of the prior 3 stages. (She would no longer have the protection of her primary EGHP)

4. FYI I also asked COB if the Medicare/Supp would pick up the 50% that the EGHP would NOT cover for her Out of Network anticipated visit to MDAnderson. Both of them said that it WOULD pick up that 50% out of network cost, AND would also pick up any other covered OOP that her EGHP failed to pay regardless if in or out of network.. (So, hopefully you are understanding why I think it is important to have her Medicare/Supp as secondary if she does in fact keep the EGHP as primary.)

-
As a side note... Usually the catastrophic 5% stage is great for most folks. For example if you are taking $1000 per mo drugs you pay only $50 while in stage 4. BUT if you are taking a $30K per mo drug, as my sister is, you pay $1,500 EVERY MONTH. That is something i wish medicare could fix. Maybe put a $8K cap on all of medicare D. Afterall, my sister's EGHP has a max all-inclusive OOP cap OF $6750 for drugs and everything else.

Thanks again for your continued comments! I will let you know more once I find out more.

 

[somarco]

EGHP will pay 100% of all prescriptions after the all-inclusive max OOP of $6,750 is reached.

That makes sense.

One good thing about Obamacare is that health and Rx claims are combined in the max OOP. Wouldn't give 2 cents for most of the rest of that law.

Regarding #3 above, there is not much in the way of clear documentation (at least not much I could find) on MSP for someone working past age 65. You may recall an earlier link I posted stated it was possible neither would pay.

It was only after digging into my wife's claim that I had an epiphany. Assuming Mcare paid my wife's hospital claim correctly there is reason to believe they would likewise pay for MDA inpatient bills . . . as long as MDA first submits to the EGHP and then to Mcare.

Who is this COB office? Someone for the group plan or Medicare?