Every winter, Medicare is the first domino to fall in the maze of senior health-care costs. The monthly charge, taken out of most seniors' Social Security checks, goes up a few dollars every January.
The deductibles also go up about $30 or more every January. And because the deductibles go up, insurers raise their rates for the supplements that pay some of what Medicare doesn't cover.
So the annual cost-of-living increase in a senior's Social Security check is no comfort, said Phyllis Byers, 68, a resident of Locust House in Westminster.
"Everything else goes up," Byers said. "You have to have clothing, too, and food. That all adds up."
Increases in Medicare and in Blue Cross Blue Shield rates for Medicare supplemental insurance take effect Jan. 1 and vary from slight to large, depending on the type of plan.
"It doesn't look that bad, but for the people I'm dealing with, everywhere they turn, things are being cut," said Susan G. Cronin, coordinator of the Senior Health Insurance Counseling and Advocacy program at the Carroll County Department of Aging.
Cronin and her 14 volunteers help seniors with the complexities of choosing among supplemental plans offered by Blue Cross and other insurers, and also help seniors who have trouble getting through the paper work and red tape of insurance and Medicare.
Starting Jan. 1, Medicare will raise its monthly charge 4.5 percent, from $28.60 to $29.90. The increase will be deducted from Social Security checks.
The big chunk of money, though, is the increased deductibles. The deductible for doctor bills went up 33 percent to $100, from the $75 it has been since 1979. After the annual deductible is met, seniors pay 20 percent and Medicare pays 80 percent of the doctor's bill, as long as the doctor participates in Medicare assignment, as most in Carroll County do, Cronin said.
For hospital visits, the deductible will go up 6 percent -- from $592 to $628. Unlike the medical bill deductible, the hospital deductible could have to be paid more than once a year. A senior readmitted to the hospital more than 60 days after last being released would pay the deductible again.
Also, patients staying in the hospital more than 60 days, a rare occurrence, pay increasing daily charges.
The increase in the hospital deductible is the highest since 1986, when it jumped by 23 percent after a 12 percent increase the year before.
Cronin said the deductible increases this year are tied to federal budget cuts last fall under the Gramm-Rudman-Hollings deficit-reduction act.
Because the deductible increases mean Blue Cross will have to pay more in benefits, the agency asked for increases ranging from 10.3 percent to 20.9 percent. However, State Insurance Commissioner John A. Donahoe last week approved smaller increases ranging from 2.4 percent to 21 percent for the Medicare supplements sold by Blue Cross of Maryland.
Rates go up as a senior gets older and can cost less if the senior is in some kind of group plan. But effective Jan. 1, for a person 65, an individual plan's annual cost will be:
* $188.18 for Basic, the company's least-expensive, least-comprehensive and least-popular plan, with only 1,800 subscribers statewide out of a total 105,000 Blue Cross members. The increase is up 21 percent over last year's rate of $155.52.
* $351.31 for Standard, up 2.4 percent over last year's rate of $343.08.
* $652.84 for Choice, up 2.9 percent over last year's rate of $634.44.
* $2,129 for Premium, up 11.9 percent over last year's rate of $1,903.20. The Premium plan -- the only one that includes prescription benefits -- has been closed to new subscribers for about four years, but still has about 9,000 of Blue Cross' total 105,000 subscribers.
Choice and Standard cover 90 percent of Blue Cross' Medicare customers.
"For nearly 90 percent of our Medicare supplemental policy holders, the rate adjustments translate into an increase of less than $2 per month," said Linda Benedict, a vice president with Blue Cross Blue Shield.
She said the insurer not only will have to pick up the increase in deductibles, but also absorb rising medical costs and increased use by patients.
"Two (percent) to 3 percent is very skinny to be able to do that," she said of the increase this year in Choice and Standard plans.
Last year, Donahoe approved for Blue Cross an average 7 percent increase, instead of the 15 percent increase the company requested.
Because of Medicare's high deductibles, the range of things not covered and the high cost of medication, seniors who can afford it buy supplemental insurance policies that pay all or part of what Medicare doesn't, said Cronin of the Department of Aging.
Single seniors making $525 or less a month and couples making up to $702 a month qualify for state medical assistance -- also called Medicaid -- to cover all those deductibles Medicare doesn't.