Medicare Supplemental Plan Coverage

Medicare and Your Plan Coverage

When will you become entitled to Medicare Benefits

You will become entitled to Medicare Benefits when you reach age sixty-five (65).  Should you be found Totally and Permanently Disabled through the Social Security Administration, you may become entitled to Medicare Benefits twenty-four (24) months from the date you were found disabled.

You or your eligible dependents may also become entitled to Medicare Benefits after the first eighteen (18) months of end-stage renal disease.

Medicare consists of two types of coverage:

  • Medicare Part A        hospital insurance for hospital in-patient stays, skilled nursing facilities, home health and hospice care
  • Medicare Part B        medical insurance for doctors, outpatient hospital care and other medical services

Medicare Part A benefits are automatically provided to you when you reach age sixty-five (65) and for disabled participants under age sixty-five (65) if:

  • You are already receiving retirement benefits from Social Security;
  • You are eligible to receive Social Security benefits but have not yet filed for them; or
  • You or your spouse had Medicare covered employment.

Medicare Part B benefits must be elected and require you to pay a monthly premium.  Any entitled to Medicare Part A benefits can enroll for Medicare Part B coverage.

You may be entitled to Medicare benefits even though you may still be an active participant still working.  If you are eligible for coverage through the Health and Welfare Fund by hours worked or even by self-paying for a deficit or shortage of hours, the Fund will be your primary insurance carrier.  If you have enrolled for Medicare benefits, Medicare would be your secondary insurance carrier.  In this case, you would need to submit all claims to the Health and Welfare Fund, and after the Fund processes your claims, you can then submit your claims to Medicare.

After becoming entitled to Medicare benefits, when you have retired or stop working and you are no longer eligible for coverage by hours worked and are making a monthly self-pay premium to the Fund, Medicare will become your primary insurance carrier.

You will then need to submit all claims to Medicare first.  Once Medicare has processed your benefits, they will then need to be sent to the Health and Welfare Fund to be processed.  The Fund will consider all charges which Medicare allows but does not pay, such as deductibles and co-payments.

The total benefits paid under Medicare and the Health and Welfare Fund cannot exceed the expenses incurred.

Should you be entitled to Medicare benefits and not enroll for coverage, the Health and Welfare Fund will not pay any claims submitted to the Fund as the primary insurance carrier.  When you become entitled to Medicare benefits, you must enroll for both Medicare Part A and Medicare Part B coverage.

If you did not enroll for Medicare benefits when you were initially entitled, you may sign up during the general enrollment period, which runs from January 1st through March 31st each year.

Should you have any questions concerning Medicare enrollment and coverage benefits, you should contact a Social Security Administration office or you may contact Medicare at 1-800-772-1213 or online at www.Medicare.gov.

International Union of Operating Engineers Local 132 retirees, under the condition they continued their Health and Welfare coverage at the time of retirement, are permitted to continue their coverage when they become entitled to Medicare benefits.  Each participant must realize when they begin Medicare coverage, they must enroll in both Part A (Hospital Benefits) and Part B (Medical Benefits) in order for the Health and Welfare Fund to continue their coverage.  In converting to the Medicare Supplemental Plan, the retirees will receive the same prescription coverage they had through the Fund while they were active employees or making the required self-contributions for full coverage.

Life Insurance Conversion Privilege

Upon becoming entitled to Medicare Benefits, the retirees eligible for coverage and were covered for the Life Insurance benefits under the group plan must convert this policy to an Individual Policy.  The Fund Office will provide you with the proper forms to convert your life insurance and the instructions for completing.  Please note, once you convert your life insurance to an individual policy, the Fund Office will no longer be able to provide information regarding coverage and your premiums, you will need to contact the Life Insurance carrier directly.

Eligibility Requirements for the Medicare Supplemental Plan

In order for you to participate in the Medicare Supplemental Plan you must:

  • Be eligible for benefits on the date you retire, been covered under the Fund for at least sixty (60) benefit quarters over your working lifetime, and be eligible for Medicare benefits on that date; or
  • Maintain your eligibility with the Fund by self-contribution from the date of your retirement until the date you become entitled to Medicare benefits and been eligible for at least sixty (60) benefit quarters over your working lifetime; and
  • Complete an application for the Medicare Supplemental Plan; and
  • Pay the required self-contribution each month.

In order for your spouse to participate in the Medicare Supplemental Benefit Plan you must:

  • Have maintained eligibility for your spouse under the Fund on a continuous basis from the date of your retirement until your spouse becomes eligible for Medicare, if not eligible for Medicare benefits on the date of your retirement; and
  • Complete an application for Family Medicare Supplemental Benefits; and
  • Pay the required self-contribution amount each month.

Spouses of deceased employees or retirees will be permitted to continue the Medicare Supplemental Plan if benefit eligibility was maintained from the date of the spouse’s death until eligible for Medicare or if eligible for Medicare at the spouse’s death.

You will not be permitted to reinstate your eligibility under the Fund in order to purchase the Medicare Supplemental Plan.

Eligibility under the Medicare Supplemental Plan will continue for you and your spouse, if applicable, until the earliest of the following dates:

  • The date the required self-contribution premium is due and unpaid;
  • The date on which a self-contribution payment is rejected by a bank for insufficient funds;
  • The date the Medicare Retirees Benefit Plan is terminated; or
  • The date the IUOE Local 132 Health and Welfare Fund terminates.

Payment of Claim

Payment of benefits will be made at regular intervals occurring at least once every thirty (30) days.  When payment is made, you will receive an Explanation of Benefits (also known as an EOB) which will explain how the claim was processed.  Included on this EOB is the provider’s original charge, the allowable amount, any deductible amount and Plan payment.  This EOB will also show your member liability, or the amount which you are required to pay directly to the provider.  Should there be no member liability, you will still receive an EOB showing the allowable amount was paid in full.  You should always retain all EOBs and notices from the Plan for your records.

How Your Claim is Processed

After you have met your calendar year deductible with the Fund, the Medicare Supplemental Plan will process all covered charges at 80% of the Medicare deductibles or the co-insurance amounts.

Shown below are two simple examples of how a claim would be processed, assuming you have already met your calendar year deductible with the Plan:

Physician Charges
Medicare Allows
Medicare Pays
Balance
$100
$100
$80
$20
Hospital Inpatient Stay
Medicare Allows
Medicare Pays
Inpatient Deductible
$22,329
$8,359
$5,714
$1,216
Fund Pays
You Pay
$16
$4
Fund Pays
You Pay
$973
$243

 

Your Prescription Drug Coverage and Medicare

Medicare prescription drug coverage became available in 2006 to everyone with Medicare, and was provided through Medicare prescription drug plans and Medicare Advantage Plans that offer prescription drug coverage.  All Medicare prescription drug plans provide at least a standard level of coverage set by Medicare.  Some plans may also offer more coverage for a higher monthly premium.

The IUOE Local 132 Health and Welfare Fund has determined that the prescription drug coverage offered by the Health and Welfare Fund is, on average for all plan participants, expected to pay out as much as the standard Medicare prescription drug coverage and is considered Creditable Coverage.

Because your existing coverage is on average at least as good as standard Medicare prescription drug coverage, you can keep this coverage and not pay extra if you later decide to enroll in Medicare prescription drug coverage.

Individual’s can enroll in a Medicare prescription drug plan when they first become eligible for Medicare and each year from November 15th through December 31st.  Beneficiary’s leaving employer/union coverage may be eligible for a Special Enrollment Period to sign up for a Medicare prescription drug plan.

You should compare your current coverage, including which drugs are covered, with the coverage and cost of the plans offering Medicare prescription drug coverage in your area.

If you do decide to enroll in a Medicare prescription drug plan and drop your IUOE Local 132 Health and Welfare coverage, be aware that you and your dependents cannot get this coverage back.  Please contact the Fund Office for more information about what happens to your coverage if you enroll in a Medicare prescription drug plan.

The Medicare Supplemental Plan pays for other health expenses in addition to prescription drugs.  If you enroll in a Medicare prescription drug plan, you and your eligible dependents will not be eligible to receive all of your current health and prescription drug benefits.

You should also know that if you drop or lose your coverage through the IUOE Local 132 Health and Welfare Fund and do not enroll in Medicare prescription drug coverage after your current coverage ends, you may pay more (a penalty) to enroll in Medicare prescription drug coverage later.

If you go sixty-three (63) days or longer without prescription drug coverage that’s at least as good as Medicare’s prescription drug coverage, your monthly premium will go up at least 1% per month for every month that you did not have that coverage.  For example, if you go nineteen (19) months without coverage, your premium will always be at least 19% higher than what many other people pay.  You’ll have to pay this higher premium as long as you have Medicare prescription drug coverage.  In addition, you may have to wait until the following November to enroll.

You will receive a Notice annually from the Fund Office regarding Medicare prescription drug coverage, as well as other times in the future, such as before the next period you can enroll in Medicare prescription drug coverage.  You can also contact the Fund Office and request that a copy of the most recent notice be sent to you.

If you enroll in one of the plans approved by Medicare which offers prescription drug coverage, you may be required to provide a notice, verifying your coverage through the Health and Welfare Fund, when you join to show that you are not required to pay a higher premium amount.

More detailed information about Medicare plans that offer prescription drug coverage are in the “Medicare & You” handbook.  You’ll get a copy of the handbook in the mail every year from Medicare.  You may also be contacted directly by Medicare prescription drug plans.  For more information about Medicare prescription drug plans:

  • Visit www.medicare.gov
  • Call your State Health Insurance Assistance Program (see your copy of the “Medicare & You” handbook for their telephone number) for personalized help
  • Call 1-800-MEDICARE (1-800-633-4227).  TTY users should call 1-877-486-2048.

For people with limited income and resources, extra help paying for Medicare prescription drug coverage is available.  Information about this extra help is available from the Social Security Administration (SSA) online at www.socialsecurity.gov, or you can call them at 1-800-772-1213 (TTY 1-800-325-0778).