Gary Russell responds to Shirlee Zerkel re: Medicare B reimbursement

From Shirlee Zerkel, June 21, 2006
Subject: Fwd: Medicare Part B reimbursement

Thought that you may be interested in the following information about survivor benefits concerning Medicare B subsidy. I asked Dennis about it yesterday and Gary's answer is in response to Dennis phone call to him. I had called STRS on Monday and again on Tuesday with questions about this issue and received totally different answers from the staff person answering the phone.

Dennis asked me if I knew of anyone to whom this already applied and if that eligible surviving spouse was receiving a subsidy for Medicare B from STRS. Do any of you know anyone?

Shirlee
________ From Gary Russell, June 21, 2006
Good morning Ms. Zerkel,

It has been a while since we e-mailed, I hope you’re doing well. Dr. Leone called yesterday in regards to your questions to our call center about the current and future policies on Medicare Part B reimbursement. I reviewed the audio of the phone calls and apologize for the incorrect information you received. The current policy for the reimbursement of Medicare Part B in regards to spouses is that there is no reimbursement to a spouse based on the relationship as a spouse. However, if the spouse is named the beneficiary on a joint and survivor annuity (which is typically the case), then upon the death of the member the spouse as the beneficiary receiving an STRS Ohio benefit would be eligible for reimbursement. Once the beneficiary became eligible for Medicare and provided proof to STRS Ohio, he or she receives reimbursement based on the member’s years of service credit. The reimbursement is in the same amount the member would have received. The beneficiary is eligible to receive this for life.

At the June Retirement Board meeting, staff recommended that the Medicare reimbursement to recipients receiving beneficiary benefits be limited to only the first five years of being a beneficiary. This would bring the reimbursement in line with the health care premium subsidy which is only provided for the first five years of receiving beneficiary benefits. The change to the Administrative Code which was recommended was not approved by the Board. Instead, Dr. Leone and Mr. Billirakis proposed a grandfather modification and direction was given to staff to draft a rule for the Administrative Code for presentation for the Board to vote on in August. The proposed rule is this:

1. Beneficiaries who are receiving a Medicare Part B reimbursement before Jan. 1, 2008 will continue to receive the reimbursement for life provided funds are available.


2. Any named beneficiary who is eligible for Medicare Part B as of Jan. 1, 2008 will receive the same reimbursement as the retiree upon the death of the retiree. A “named beneficiary” is the beneficiary who is due to receive a continuing benefit upon the death of the retiree.


3. Any named beneficiary who is not eligible for Medicare Part B as of Jan. 1, 2008 and all named beneficiaries of members who retire Jan. 1, 2008 or later will only be eligible to receive the Medicare reimbursement during the first five years of being a benefit recipient.

Since your husband who is also your beneficiary is already 65 and eligible for Medicare, he is eligible to receive Medicare reimbursement for life if you should die before he does. If he didn’t turn 65 until Jan. 2008, he would have only been eligible to receive the reimbursement for the first five years of being a benefit recipient.

As noted above, the Board is expected to vote on this proposed rule at the August meeting.

I hope this helps and apologize again for the incorrect information you received.

Sincerely,

Gary Russell
Director, Member Services
STRS Ohio