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Health Benefits

CIP| Medicare | TRAIL | Questions

College Insurance Program (CIP)

CIP Benefits

College Insurance Program (CIP)

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CIP Frequently Asked Questions (FAQ)

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Medicare

Medicare is divided into 4 parts, and most people new to Medicare find this very confusing. Medicare itself has different parts (not plans), so let’s start with those 4 parts of Medicare explained.

4 Parts of Medicare

Medicare Pension Costs

If you’re retired and have Medicare and group health plan (retiree) coverage from a former employer, generally Medicare pays first for your health care bills, and your group health plan coverage pays second. For further information, “Read 4 things you need to know about how retiree insurance works with Medicare.“

Your Medicare Coverage

When you first enroll in Medicare and during certain times of the year, you can choose how you get your Medicare coverage. There are 2 main ways to get your Medicare coverage—Original Medicare (Part A and Part B) or a Medicare Advantage Plan (called Part C, it includes Part A & B). Drug coverage may be included in yout Plan C, but if not you may need additional coverage, like Medicare drug coverage (Part D) or Medicare Supplement Insurance (Medigap).

Medicare Costs at a Glance

https://www.medicare.gov/your-medicare-costs/medicare-costs-at-a-glance

Part A Hospital Insurance Costs

Part A of Medicare is your hospital insurance. This helps you cover common hospital expenses for things such as the cost of a semi-private room for stays, hospice, and home health care.

You usually don’t pay a monthly premium for Medicare Part A (Hospital Insurance) coverage if you or your spouse paid Medicare taxes for a certain amount of time while working. This is sometimes called “premium-free Part A.”

Medicare Part A covers in-patient hospital costs.

Part B Medical Insurance Costs

Part B Medicare is your outpatient medical expenses such as doctor visits. Most people pay the standard premium amount each month for Part B. Your Part B premium may be automatically deducted if you also receive Social Security. If you aren’t receiving Social Security, you will receive a bill.

If you don’t sign up for Part B when you’re first eligible, you may have to pay a late enrollment penalty.

Medicare Part B covers outpatient medical services.
Income Related Monthly Adjustment Amount (IRMAA)

If your modified adjusted gross income is above a certain amount, you may pay an Income Related Monthly Adjustment Amount (IRMAA) to Part B. See income table. Medicare uses the modified adjusted gross income reported on your IRS tax return from 2 years ago. This is the most recent tax return information provided to Social Security by the IRS. We highly recommend that you consult the Medicare.gov site and your Financial advisor for more information regarding IRMAA.

For Example:

In 2020, Medicare Part B can cost considerably more than the standard $144.60/month most seniors pay, if one’s “modified adjusted gross income” TWO YEARS PRIOR was higher than $87K individual or $174K joint.  This extra charge is called Income Related Monthly Adjustment Amount (IRMAA), and it is added to the standard premium.  And it can be a very significant increase in cost! 

TIP:  If you are going to have a significantly higher taxable income from an financial event that you can control, it is wise to do that before age 63, which is before Medicare’s “look back.”  For example, these events could include withdrawing $$ from one’s IRA; transferring IRA $$ into a Roth IRA; earning income as an estate’s executor; or similar.  The amount of income above $87K is crucial, because Medicare’s IRMAA categories vary by almost $100/mo.  See income table.

Part C Medicare Advantage Plans Cost

Part C of Medicare, that are actually Medicare Advantage Plans is a type of health insurance plan in the United States that provides Medicare benefits through a private-sector health insurer. In a Medicare Advantage plan, a Medicare beneficiary pays a monthly premium to a private insurance company and receives coverage for inpatient hospital (“Part A”) and outpatient (“Part B”) services. Typically, the plan also includes prescription drug (“Part D”) coverage. Many plans also offer additional benefits, such as dental coverage or gym memberships. 

Medicare Advantage provides Part A, Part B and usually Part D of Original Medicare insurance.

By contrast, under so-called “Original Medicare“, a Medicare beneficiary pays a monthly premium to the federal government and receives coverage for Part A and Part B services, but must purchase other coverage (e.g., for prescription drugs) separately. Medicare Advantage plans usually have a network of providers for your region from which you seek your care.

  • Medicare Advantage is an “all in one” alternative to Original Medicare. These “bundled” plans include Part A, Part B, and usually Part D.
  • Plans may have lower out-of-pocket costs than Original Medicare.
  • In many cases, you’ll need to use doctors and other providers who are in the plan’s network and service area for the lowest costs.
  • Most plans offer extra benefits that Original Medicare doesn’t cover—like vision, hearing, dental, and more.

Before enrolling in this part of Medicare, read a layman’s post on Medicare Advantage vs Medicare Supplement. You’ll be choosing one type of coverage or the other, so you’ll want a good understanding of how each type of coverage works.

An explanation for Part C from Medicare. Learn more about how Medicare Advantage Plans work.

Part D Prescription Drug Plans Costs

Part D of Medicare, requires that you sign up for Part D (drug coverage) if you have Original Medicare. If you have Medicare Advantage (including TRAIL), it is included in the plan. For more information about Part D go to the Medicare.gov site.

Medicare Part D provides coverage for prescriptions.

TRAIL

CIP Total Retiree Advantage Illinois (TRAIL) Member TRAIL 

The State of Illinois offers members under the College Insurance Program (CIP), a healthcare program called Total Retiree Advantage Illinois (TRAIL). This program provides eligible members and their covered dependents, comprehensive medical and prescription drug coverage through Medicare Advantage Prescription Drug plans commonly referred to as “MAPD” plans. The CIP program also includes vision coverage through EyeMed, and dental coverage through Delta Dental.

Aetna Medicare Advantage Plan is the only health insurance option for roughly 140,000 retired state workers for the next five or more years. 

Eligibility Highlights for CIP TRAIL Program

  • Retirees and survivors of the State, CIP and TRIP group insurance programs.
  • Retiree and all covered dependents must be enrolled in Medicare Parts A and B. See Eligibility Criteria for more details.
  • Non-Medicare households must seek benefits under the non-Medicare programs offered by the State, which are described on the Benefits website at www.benefitschoice.il.gov.