Medicare and STRS members: explained by one of our own, in language WE can understand -- but some of the news is dire!

A 'huge world of hurt' just waiting to happen to older retirees on meager pensions?

Medicare, STRS and you!
By Shirlee Zerkel
April 3, 2007

If you have 40 credits in Social Security or in Medicare taxes, it will make a big difference when you are 65. You would then be eligible for Medicare A at no cost and so will your spouse. Do you receive a yearly summary notice every fall from Social Security? It should state on the left side of the information that you are eligible for Medicare A and also if you might be eligible for Social Security as well.

If you are over 65, please look at your Medicare Card at the bottom left. If you have both A and B, it will be stated. All of you who on STRS insurance have to purchase Medicare B. So all retirees will have Medicare B which is for medical (doctor, surgeons, and some tests and other services). Medicare A is for hospitalization.

By having 'real' Medicare A, you will be covered for hospitalization 100% after the deductible of $992 (for 2007). That deductible amount is sent to STRS insurance. Then if you have the Plus Plan, You must pay the first $500 a year STRS deductible, so then you will pay a total of $598.40 for that hospital stay.

If you have the STRS comprehensive hospital coverage, first a $500 deductible will be paid by you and then you will have to pay 20% of the entire hospital bill until you hit the Maximum out-of-pocket cost to you of $1,500. So with STRS comprehensive hospital coverage you will pay $2,000 for the same hospital stay. You will also have to use in network hospitals for their hospital coverage.

If you want to stay in the STRS health care system for prescription drugs and the supplemental, you will also have to sign up and pay for Medicare Part B which is $93.50 a month for 2007. This you pay quarterly to Medicare unless you are eligible for a small Social Security pension and then the cost of Part B will be taken out of the SS check. As it stands at the present time, the Basic Plan with STRS is not a good one to have with Medicare A and B because after Medicare pays their part, you would never have enough expenses, unless real tragedy hit, to go over the $1,500 deductible that STRS has.

If you were 65 this year and on Medicare A and B and STRS Plus with a $500 deductible, your premiums would total $160 a month -- $93.50 for Part B and $67 for STRS. Medicare usually pays 80% of what is reasonable and customary. The Medicare determination is all that the provider can expect to receive and then STRS is supposed to pay 80% of what is left after Medicare pays. You see then that STRS is paying very little of the health care for the 65 and over retiree who has both Medicare A and B.

A retiree, age 65 and over, who receives their Part A coverage from STRS, will pay the same premiums to STRS and will also pay the $93.50 for Part B. Same monthly premium costs as those on Medicare A and B but with less coverage! One problem is that you have to use in-network providers and that can be a real headache sometimes because a patient can not control that all medical persons on his case are in the network. When STRS covers the bills for those not on Medicare Part A, STRS is paying almost all of a retiree's hospital stay. Large outgo of health care funds! But I do not recommend taking it away from the retirees!

Now for the really bad news if STRS were to stop health care coverage. We on Medicare A and B would still have something. But Mr. Russell at STRS feels being on Medicare is not good in the future either. Mr. Russell stated: "I should point out that Medicare is currently predicting insolvency before STRS Ohio."

But the many retirees who never paid into Medicare will be a 'huge world of hurt'. They will have nothing! If STRS had ended health coverage this year, retirees on STRS insurance would have had to pay $410 per month for Part A and at minimum $29 for Part D. That total would be $532 for Part A, B, and D for each member alone. That does include the spouse. That cost also does not cover a supplemental to help with what Medicare does not cover. This would include all who retired before 1986 or '87 and many who retired after that date as well and some who are still teaching. Many of the thousands of retirees that this could happen to probably do not even receive $800 in pension benefits, as they retired years ago. This should not happen to them! They will have no way to cover this huge increase in cost. They are dependent on STRS for this coverage; STRS should not leave them uncovered.