Summer is almost upon us and so is travel season. Travel is one of the great rewards people look forward to in retirement. That fabulous trip to a new destination or a familiar one is a long-term goal for many.
One of the questions I am asked frequently is, "How does my Medicare work when I travel?" The first thing folks need to know in order to answer that question is what type or "flavor" of Medicare they have. Generally speaking, there are two types of Medicare. They either have:
* "Original" Medicare, which includes Medicare Part A for hospital care, Part B for outpatient services and Part D for prescriptions. Many times they also have a Medigap plan for supplemental coverage.
* Medicare Part C, which I call the "combo" plan because it combines Medicare Parts A, B, usually D and some supplemental coverage into one package.
Medicare health care benefits while traveling vary between the flavors. The benefits also differ depending on if the travel is domestic or foreign.
Original Medicare allows for very flexible travel in the case of a medical emergency, as well as routine health care services all over the 50 U.S. states and in Washington, D.C., Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa and the Northern Mariana Islands. Given that there are no health provider networks involved in original Medicare, beneficiaries can use their Medicare to pay for care at any facility that accepts Medicare nationwide.
If you also have a Medigap plan, that can also be used in conjunction with original Medicare anywhere in the U.S. Medigap is not network dependent. Therefore, a beneficiary can use Medigap to reimburse standard Medicare copayments and coinsurance from any provider that accepts Medicare.
Medigap has 11 different levels of coverage. Medigap Plans C, D, F, G, M and N pay 80% of medically necessary emergency care outside the U.S. after meeting a $250 annual deductible. While several types of Medigap plans offer foreign emergency benefits, Medigap Plan F includes the most extensive payment for various types of Medicare copayments. A foreign travel emergency is covered if it begins during the first 60 days of the trip and if Medicare doesn't otherwise cover the care. Medigap foreign travel medical emergency benefits have a $50,000 lifetime limit.
Combo Medicare can be used anywhere in the United States and its territories for a true medical emergency. Beyond that, most combo plans offer maximum benefits for in-network care. With combo plans, beneficiaries can use any emergency room for a true medical emergency, but if you need urgent care you will get the best bang for their buck by going to an in-network center. You can easily determine what providers are in network by either calling the customer service number on the back of your insurance card or by looking at the plan website for in-network health care services. Very few combo Medicare plans offer any foreign travel medical emergency coverage. For those that do, the dollar amounts are very limited.
Medicare may pay for health care services in a foreign hospital if a person is:
* In the U.S. experiencing a medical emergency and the foreign hospital is closer than the nearest U.S. hospital.
* Traveling through Canada by the most direct route between Alaska and another U.S. state when a medical emergency occurs, and the Canadian hospital is closer than the nearest U.S. hospital.
* Living in the U.S. and the foreign hospital is closer to your home than the nearest U.S. hospital that can treat your medical condition, regardless of whether it's an emergency.
By the way, under certain limited conditions, Medicare will even pay for services on a cruise ship.
Medicare's prescription drug coverage, whether as part of a combo plan or original Medicare, is fairly flexible when traveling through the U.S. and the territories. All Medicare prescription drug plans involve networks. The best cost for any medication will be at a preferred or in-network pharmacy. As I mentioned earlier, you can call customer service or check out the plan website for covered pharmacies.
A word to the wise is to consider purchasing medical evacuation insurance, particularly if you are traveling to exotic locations or have complex medical conditions. Neither Medicare nor Medigap pay for medical evacuation, which can run in excess of $100,000. Travel services are a good source of that type of insurance.
Help your clients prepare for that bon voyage by giving them the gift of knowledge about how to travel well and use Medicare.
(Want to get more out of Medicare? Download my e-book here.)
Katy Votava, Ph.D., RN, is president of Goodcare.com, a consulting service that works with financial advisers and consumers concerning health care coverage.