Medicare Basics and Coverage Options
Discover Medicare Basics: Essential information on healthcare coverage for seniors. Find out about plans, eligibility, and costs.
Medicare is a federally funded healthcare program that assists in providing coverage to people over the age of 65, people with certain disabilities, and people with End-Stage Renal Disease (ESRD). Medicare is broken down into different components, each with its own set of coverage and benefits.
What is Medicare?
Original Medicare is a health insurance program that provides coverage for Americans who are 65 years of age or older, and certain disabled individuals. It is administered by the Centers for Medicare & Medicaid Services (CMS) and consists of two separate parts: Part A (Hospital Insurance) and Part B (Medical Insurance).
Medicare Part A
Medicare Part A covers inpatient hospital care, skilled nursing facility care, hospice care, home health care, and some related services. Part B covers medically necessary services such as physician visits, lab tests, medical equipment, and supplies, and preventive care services like vaccines, screenings, and more. Together they cover most areas of healthcare not covered by other forms of insurance.
Medicare Part A is also referred to as Hospital Insurance because it helps pay for inpatient hospital stays and related care.
The costs associated with inpatient hospitalization can be expensive so this type of coverage helps reduce those costs.
Medicare Part A includes coverage for such things as room charges; meals; nursing; drugs administered during your stay; operating room charges; physical therapy; ambulance transportation; medical social services; durable medical equipment used during your in-hospital stay; blood transfusions; and mental health services.
When you enroll in Original Medicare you are automatically enrolled in both Parts A and B. There are no monthly premiums for Part A if you’ve been paying into the system through payroll taxes while working but there is a deductible that must be met before benefits begin.
Medicare Part B
For Medicare Part B there is a monthly premium based on income so the amount you may have to pay will vary from person to person. With both Parts, there are co-payments for certain types of services such as doctor visits or hospital stays that must be paid out-of-pocket at the time of service.
Original Medicare offers comprehensive coverage but out-of-pocket expenses can still add up quickly when faced with expensive treatments or procedures not covered by Part A or Part B.
To help limit these costs many people choose to purchase a Medigap policy which supplements their Original Medicare coverage by covering some out-of-pocket costs not included in Parts A or B including deductibles, coinsurance amounts, and copayments.
In addition to Medigap policies, other options exist such as employer group plans or Medicare Advantage Plans which allow individuals to purchase additional coverage beyond what Original Medicare provides.
All in all Original Medicare is an important component of health insurance coverage for seniors 65 years or older and certain disabled individuals in the United States providing a level of security against high healthcare costs due to unexpected illness or injury.
While out-of-pocket expenses can still occur it remains an invaluable resource offering access to quality healthcare when needed most making it an essential part of any retirement plan.
What are the Parts of Medicare?
Medicare is a government-funded health insurance program that provides coverage to seniors and eligible individuals with disabilities in the United States. It is composed of four parts – Medicare Part A, Part B, Part C, and Part D – each providing different coverage depending on the individual’s needs.
Medicare Part A
Medicare Part A covers expenses related to inpatient hospital stays, hospice care, skilled nursing care, and some home health services. It does not include physician’s services or most drugs. Those are covered by Parts B, C, and D.
Medicare Part A is a vital component of Medicare coverage, providing hospital insurance for those who are 65 and older. This coverage includes inpatient hospital stays, care in skilled nursing facilities, hospice care, and some home health services.
The cost of Medicare Part A depends on the individual’s work history and whether they have paid into Social Security and/or Railroad Retirement Board. If a person or their spouse has worked for ten or more years, then they qualify for premium-free Medicare Part A. Those who do not qualify for premium-free must pay a monthly premium for their coverage which ranges from $252 – $458 depending on their work history.
Part A covers the cost of inpatient hospital stays, including the cost of meals and a semi-private room as well as any medically necessary treatments, lab tests, diagnostic services, or devices that are prescribed by doctors. It also covers care obtained at skilled nursing facilities including physical therapy or rehabilitation services if medically necessary.
In addition to these scenarios, it also covers care provided at home by a qualified home health professional such as a nurse or therapist; but only if certain conditions are met such as requiring periodic visits from a medical professional, being unable to leave the house without assistance due to an illness or injury and needing part-time help with medical equipment like an oxygen tank.
Hospice care is covered under Part A too; this includes drugs to alleviate pain and other symptoms related to terminal illnesses as well as counseling services for both patient and family members when applicable.
It’s important that you review your Medicare coverage options carefully so that you can be sure you select the best plan for your needs; this is especially true when evaluating Medicare Part A given its complexity associated with costs, co-pays, and coverage details outlined above.
Medicare Part B
Medicare Part B covers physician’s services such as visits to the doctor’s office or outpatient treatments. It also covers preventive services such as screenings and tests as well as durable medical equipment (DME) like wheelchairs and walkers.
Part B pays for physician and other healthcare professional services, as well as outpatient care, home health care, and durable medical equipment.
Medicare Part B is a supplemental health insurance program that helps cover medical costs for eligible individuals in the United States. It is designed to provide financial assistance with doctor visits, lab work, durable medical equipment, and other medically necessary services. Medicare Part B also provides coverage for certain preventive services like vaccines and screenings.
Individuals who are 65 or older, as well as those with certain disabilities, may be eligible for Medicare Part B coverage. In order to qualify, individuals must be enrolled in either Original Medicare or a Medicare Advantage plan. Additionally, they must meet certain income and residency requirements established by the government.
The cost of Medicare Part B depends on a variety of factors including the individual’s income level and where they live. Generally speaking, most people pay a monthly premium of $148.50 for their Part B coverage. This amount can go up depending on an individual’s income level or if they have to pay late enrollment penalties. There may also be an annual deductible that needs to be paid before any coverage kicks in. Once these costs are covered, then Medicare Part B will typically cover 80% of approved medical expenses up to an annual limit set by the government.
Medicare Part B covers a wide range of medically necessary services and supplies such as doctor’s visits and preventive care like vaccines and screenings; inpatient hospital care; ambulance services; home health care; mental health care; physical therapy; durable medical equipment; laboratory tests and x-rays; preventive services like cancer screenings and flu shots; some prescription drugs; and many more approved services. However, it is important to note that there are some procedures and treatments that are not covered by Part B such as cosmetic surgery or routine foot care (with few exceptions).
In summary, Medicare Part B is an important supplemental health insurance program designed to help cover medical costs for qualified individuals in the United States. It requires payment of premiums each month along with possible late enrollment fees plus an annual deductible before coverage applies. Once these costs are met, then it will generally cover 80% of approved medical expenses up to an annual limit set by the government while providing coverage for a wide range of approved medically necessary procedures and treatments (though there are some exclusions).
Medicare Part C
Medicare Part C also referred to as “Medicare Advantage”, is an option for those who want to receive their Medicare benefits through a private company rather than directly from the government. These plans may offer additional benefits beyond Original Medicare such as vision or dental coverage at an additional cost.
Medicare Advantage plans are a type of health insurance coverage option for Medicare beneficiaries in the United States. These plans offer an alternative to Original Medicare, providing coverage for hospital care, doctor’s visits, preventive services, prescription drugs, and more.
Beneficiaries typically pay a monthly premium in addition to their regular Part B premiums for the coverage provided by the plan. The cost of a Medicare Advantage plan depends upon several factors including the county you live in, your age, and medical needs. In many cases, premiums may be lower than those associated with Original Medicare.
In general, Medicare Advantage plans to provide similar coverage to that offered by Original Medicare but there are some key differences. For example, many Advantage plans offer additional benefits such as vision and dental care or fitness memberships. In addition, many plans have limits on how much you will be required to pay out-of-pocket for your healthcare costs each year.
When considering a Medicare Advantage plan, it’s important to understand all of the costs associated with the plan including any copayment or coinsurance amounts due at the time of service. It’s also important to review whether any of your preferred doctors or hospitals accept the plan before enrolling.
Overall, Medicare Advantage plans provide an alternative way for those eligible for Medicare to get healthcare coverage at potentially lower costs than Original Medicare while still using providers they trust and like. By taking time to compare different options available in their area, beneficiaries can choose a plan that best fits their needs and budget while still offering the quality care they deserve.
Medicare Part D
Finally, Part D of Medicare provides coverage for prescription drugs at participating pharmacies across the country. It is administered by private companies that contract with the Centers for Medicare & Medicaid Services (CMS). The plan may include a deductible and coinsurance depending on which drug plan you choose.
Medicare Part D is a prescription drug coverage plan offered to individuals enrolled in Medicare. It helps cover the cost of prescription drugs and can lower out-of-pocket spending on medications. This coverage is available through private insurers who contract with Medicare, giving enrollees a variety of plans and options to choose from.
When evaluating different plans, it’s important to look at the costs associated with each option. These costs vary based on factors such as the type of drugs covered, premiums, deductibles, copayments, and coinsurance amounts. There are also varying levels of coverage for different types of drugs; some plans have higher coverage limits for brand-name drugs than generic drugs. Enrollees should consider what medications they will be taking to determine which plan is best for them.
The cost for Part D coverage varies each year and depends on the type of plan chosen by the enrollee. Most plans require an annual deductible that needs to be paid before any reimbursement can be made. After this deductible is met, most plans offer coinsurance or copayment costs that must be paid when filling prescriptions. The amount of each expense can vary depending on the drug being purchased and whether it is generic or brand name.
In addition to costs associated with prescriptions, there may also be additional charges applied during certain times throughout the year known as “Late Penalty Fees.” If an enrollee fails to join a Part D plan during their Initial Enrollment Period (IEP) they could incur these penalties when they do eventually join a plan later in life.
Medicare Part D provides substantial coverage for prescription medication expenses but it’s important for enrollees to research their options carefully before enrolling in a plan so that they get the most value out of their prescription drug coverage. By doing this evaluation each year, enrollees can ensure that their costs remain low and that their prescriptions are being handled by an insurer that offers quality service.
Medicare Plans and options
Overall, these four parts of Medicare provide individuals with different levels of coverage depending on their unique health needs. Understanding each part can help ensure you get the specific type of coverage you need in order to stay healthy throughout your life. including deductibles, coinsurance amounts, and copayments.
In addition to Medicare, there is coverage you may add to help pay medical expenses. These include:
- Medicare Supplement Insurance (Medigap)
- Medicare Advantage plans
Medicare Supplement Plans
Many people choose to enroll in a Medicare Supplement plan to help pay for the gaps in Original Medicare Part A and B. These plans are lettered A-N and are offered by private insurance companies.
One of the most popular plans for people new to Medicare is Medicare Part G (also called Plan G). This covers 100% of the gaps in Medicare Part A and B, except for one small deductible.
All in all Original Medicare is an important component of health insurance coverage for seniors 65 years or older and certain disabled individuals in the United States providing a level of security against high healthcare costs due to unexpected illness or injury.
While out-of-pocket expenses can still occur it remains an invaluable resource offering access to quality healthcare when needed most making it an essential part of any retirement plan.
Medicare Enrollment
If you already get Social Security (or Railroad Retirement Board) benefits, you will be enrolled in Medicare right away.
If you are still working and do not have health insurance, enroll in both Part A (Hospital Insurance) and Part B (Medical Insurance) as soon as you are eligible (usually when you turn 65).
There are several disadvantages to joining later, such as having to pay a penalty. Otherwise, you must register.
When you sign up for Part A (Hospital Insurance) and Part B, you may choose to add a Medigap plan and prescription Part D coverage, or opt out of Medicare to join a Medicare Advantage plan.
Medicare Open Enrollment
Medicare open enrollment is an important time of year for those who are eligible for Medicare benefits. During open enrollment, those enrolled in Medicare can make changes to their coverage, compare plans, and review their options. Open enrollment typically begins in October each year and runs through the end of December.
It’s essential during open enrollment to review your current plan to see if it meets your needs. Medicare offers a variety of plans that vary in cost and cover different types of services. It is important to consider cost when choosing the best plan for you. The premium for Original Medicare (Parts A and B) is typically deducted from Social Security benefits each month.
Other Medicare plans may have additional premiums or co-pays associated with them, so it’s important to weigh all costs when making your decision.
In addition to considering costs, it’s also important to compare coverage levels between different plans during open enrollment. Most Medicare Advantage plans offer additional benefits such as dental, vision, or hearing coverage not included in Original Medicare.
Depending on your individual situation, these extra benefits may make a particular plan more appealing than another one without them.
Finally, those eligible for Medicare should also consider whether any changes need to be made to their prescription drug coverage during open enrollment. These changes can include signing up for a Part D drug plan or switching drug plans if they are already enrolled in one.
Different Part D drug plans have varying copayments and premiums depending on the drugs covered by the plan, so it’s important to research what drugs are covered before selecting a plan that is right for you.
Open enrollment is an exciting time for those already enrolled in Medicare as well as those just becoming eligible due to age or disability status. This annual period gives individuals the opportunity to review their current coverage and compare other options available so they can select the best plan suited for their individual needs and budget constraints.
Medicare FAQs
How Does Medicare Works Together with Other Insurers?
If you have additional health insurance, such as through your job, in addition to Medicare, one plan will be the primary payer and the other will be the secondary payer.
The monthly cost of this insurance varies depending on the plan you choose, your location, and other factors. You must have both Part A and Part B to enroll in Medigap insurance, and you cannot have a Medigap policy if you are enrolled in a Medicare Advantage plan.
The primary payer will pay first, followed by the secondary payer for any remaining costs up to the limits of its coverage. If you are still working at the age of 65 and have employer-provided health insurance, you may be able to postpone Part B enrollment without penalty.
When Should You Enroll in Medicare if You Have Other Insurance?
If you or your spouse are still working at the age of 65 and have job-based health insurance, you may postpone enrolling in Medicare Part B until you lose that coverage. If your firm has fewer than 20 employees, Medicare will be your primary coverage once you enroll; however, you may defer Part B participation until you lose employment coverage, which you may do without penalty.
If your company employs 20 or more employees, you may choose to enroll in Part A but defer Part B until you retire, as long as your employer’s coverage is considered “creditable.” If you have alternative insurance, such as Medicaid or Marketplace coverage, you may be subject to additional restrictions.
How Does Other Insurance Affect Medicare?
If you have other insurance, who pays first is determined by a variety of factors, including whether you are still working, the kind of insurance you have, and if you have a specific situation, such as End-Stage Renal Disease (ESRD).
If you cannot afford insurance, there are financial help alternatives available. You (or your spouse) continue to work and get a stipend from your employer to cover the cost of your own health insurance. Check with your health insurance carrier when you reach the age of 65 to determine whether you need to enroll in Parts A and B.
Some private insurance companies have rules that restrict (or refuse to pay for) therapies if you are eligible for alternative coverage, such as Medicare. In general, Medicare does not work with your insurance company. When you enroll with Medicare, Medicare pays first.
How to Sign Up for Medicare?
If you already get Social Security (or Railroad Retirement Board) benefits, you will be enrolled in Medicare right away.
If you are still working and do not have health insurance, enroll in both Part A (Hospital Insurance) and Part B (Medical Insurance) as soon as you are eligible (usually when you turn 65). There are several disadvantages to joining later, such as having to pay a penalty. Otherwise, you must register.
When you sign up for Part A (Hospital Insurance) and Part B, you may choose how you want to get your coverage (Medical Insurance).
When and how should you enroll in Medicare Supplement Insurance?
If you are enrolled in Original Medicare, you may apply for Medicare supplement insurance at any time. Keep in mind, you are guaranteed coverage if you are within 6 months of enrolling in Medicare Part B. Outside of these six months, you will have to answer questions and get medically approved for a Medigap policy.
When may I enroll in Medicare Advantage and prescription drug plans?
If your job-based insurance expires, you have two months to enroll in a Medicare Advantage plan or a Medicare prescription plan. If you want your plan’s coverage to begin when your job-based insurance ends, sign up for Medicare and join a plan before it does.
To learn more about Medicare and Medicare plans, call us today at 1-888-891-0229.
We’ll answer all of your questions and help you find the right Medicare plan.
Updated December 4th, 2022